Legalectric

Can you see the red and yellow lines going south on this site plan? That’s planned routes for infrastructure, one of them is for the huge natural gas pipeline that will go south to connect to the gas line in Blackberry. Recently, Trout Lake Township residents learned that yes, indeed, a route from Blackberry to Mesaba will go through the township, and that it will take land from local landowners. It’s one of those ugly scenarios where the legislatively granted power of eminent domain is available to Excelsior:

Regulatory Incentives

(3) has the power of eminent domain, which shall be limited
to the sites and routes approved by the environmental quality
board for the project facilities. The project shall be
considered a utility as defined in section
116C.52, subdivision 10, for the limited purpose of section 116C.63.
The project shall report any intent
to exercise eminent domain authority to the board;

Thankfully, township residents are paying attention:

Property will be sacrificed for jobs

Editor:

In regards to the coal gasification plant proposed for our area:

There are many more considerations involved than are pointed out to us at this time. We are discussing the impact of the plant and its processes on the environment and on the immediate area around the plant, but I am not hearing any mention about the impact of fuel supply or power line output.

I have heard through an alert township representative that Excelsior Energy wants to have a natural gas line run from the Blackberry Township area to Taconite via Trout Lake Township (up the west side of North Road, then up the east side of Birch Drive and then cross country to Taconite).

If you have never had a gas line run across your land, you are lucky. Once the line is allowed, you no longer have control of your land. You can’t build on their right-of-way and you can’t put any permanent structure on their easement. In the case of this proposed pipeline (natural gas) you would be a fool to put your home nearby. In the case of small lots, your land becomes worthless.

Excelsior Energy is also considering a power tie-in with the Blackberry sub-station. Guess where the power line would go!

Check it all out, folks. My guess is that you won’t have a darned thing to say about it, but our local politicians want those jobs and will sacrifice more than 60 parcels of private property to get these jobs for their re-election. Heads up, folks!

Bob Norgord
Bovey

Questions about the gas line

Editor:

In regards to the Excelsior Energy wanting to run a natural gas line from Blackberry to Taconite, I am a concerned resident of Trout Lake Township. If this gas line goes through, what kind of impact will it have on the environment, or the people who own the land where this gas line will be placed? Does it mean that they will have no control over their land where this gas line will reside? And, if so, do we have anything to say about it?

Heather Kossow
Bovey

This is way too much fun! Another great letter in the Grand Rapids Herald Review, from someone I’ve never heard of, and an article about the choices facing the county — a binary moment approaches.

County should drive hard bargain to get its due

Editor:

Thanks to the Itasca County Commissioners for working for the interests of local citizens in the matter of Excelsior/Micheletti’s plans to put a coal gasification plant in close proximity to many private landowners and renters. Some legislators are putting Excelsior/Micheletti’s interests above their constituents, exempting a power plant from millions in personal property tax at a time when local governments are suffering due to revenue loss. Local governments are already doing a lot for this private for-profit corporation.

Isn’t it a legislatorâ??s job to help stabilize the community, not destabilize — to promote economic development, not detriment?

I hope we can drive a hard and fair bargain with this corporation in return for what they are getting from us.

Bob Beech
Iron Range Township

And about the latest county meeting with the MSI and Mesaba consultant from SEH:

County faced with commitment decisions on Minnesota Steel, Excelsior Energy projects

Itasca County will face a number of decisions in the coming two months about just how far it wants to go in financially supporting the proposed Minnesota Steel and Excelsior projects.

The Minnesota Steel project proposal has the ambition of developing an iron ore processing and steel production facility near Nashwauk. The Excelsior Energy Project proposes a coal gasification plant near Taconite. Minnesota Steel officials have estimated that the project brings to the table 700 permanent jobs. Excelsior Energy officials have previously stated that its project will bring 100 permanent jobs to the area.

Several infrastructure elements needed for the proposed developments to move forward will be discussed with county commissioners in the weeks ahead. On Tuesday at a special meeting of the board, commissioners listened to an update from Short, Elliott and Hendrickson officials, with which the county has contracted to oversee the infrastructure for the proposed projects, on where the challenges are and what decisions will likely lie ahead.
According to Chuck Michael of SEH, major infrastructure elements required for the economic development projects to move forward include railroad, roadway, gas pipeline, fresh water supply and wastewater treatment.
Roads and railways will be the main county elements of involvement – gas pipeline, water and wastewater treatment will largely be under the jurisdiction of the cites of Nashwauk and Taconite.

Already, however, the county faces potential financial outlay for the projects in the form of required aerial photography, which must be completed before infrastructure planning can begin. The current estimated pricetag for that service is about $210,000 for both projects and there is some question about if the county footed the bill if reimbursement would be possible.

While the governor has included $7 million in his bonding proposal for infrastructure for both sites, a number which falls far short of the $92.4 million requested by the county, bonding money may not be a source of reimbursement for aerial photography – unless expressly written into legislation.

County Attorney Jack Muhar noted that reimbursement for upfront costs was an issue with the bonding money allocated for the MIS project.

The difficulties with determining just how far the county wants to risk its own financial resources was put into focus by Michael who noted that financial contingencies could delay development.

“If the bonding bill passes contingent on financial close, it puts the (construction) schedule six months behind,” he said.

Financial close of the Minnesota Steel project is expected to take place in December of this year and hinges on completion of environmental review and the permitting process, according to Howard Hilshorst of Minnesota Steel.
It is unlikely that the timetable can be moved up, but infrastructure construction needs to begin this summer to keep the project on schedule. The question then for the county, said Michael, becomes how far the county wants to go in its financial commitment.

“How much does the county want to jump the gun to help meet the timeline?” Michael asked commissioners.
Michael suggested that going back to aerial photography vendors for potential reduction in price was one option which would potentially pose less risk to the county. The aerial photography would likely need to be completed by the end of April to keep the Minnesota Steel project on schedule for production to begin at the outset of 2009.
Commissioner Catherine McLynn also suggested that perhaps the county could look at aerial photography for the Minnesota Steel project only, which has a tighter timeline than Excelsior Energy. That move could bring the potential cost down to just more than $60,000.

Commissioner Rusty Eichorn questioned whether the county should be responsible for the aerial photography bill.
â??Are we assuming the county is going to be responsible for the aerial photography and how is it going to be paid for?â? questioned Eichorn.

The discussion ended with more questions than answers, however, SEH officials and commissioners did map out some actions.

County officials verbally agreed that local legislators would be contacted to determine if reimbursement costs could be written into the bonding bill once finalized. SEH will go back to the vendors to determine if some cost savings can be gained in the aerial photography bill.

In other business at the special meeting, the board:

â?¢ Listened to a report from SEH railroad expert Dave McKenzie, who updated the board on rail needs the two projects would have as well as a general outline of county options for that service. Railroad infrastructure carries a potential pricetag of $30 to $40 million. While McKenzie noted that state bonding was the countyâ??s best bet for funding, other sources are available including federal loans, county revenue bonds and shipper funds.

â?¢ Listened to an update on potential other funding sources for water, wastewater treatment and gas pipeline infrastructure for the projects from Dick Grabko of SEH. Funding for these elements is available from Iron Range Resources, the Minnesota Department of Employment and Economic Development, federal Rural Development loans and the federal Economic Development Authority.

â?¢ Reviewed the timetable and discussion topics for subsequent meetings, which will take place the first and third Tuesdays of each month through May. Upcoming topics include: wetland permitting, gas pipeline, roadways and shortline railroad.

Last night was the meeting of the Progressive DFL Caucus in Grand Rapids, and Tom Micheletti, of Excelsior Energy, presented on the Mesaba project. For more details on the project, see www.mncoalgasplant.com. Micheletti was introduced by Sen. Tom Saxhaug, who, for the record, noted that coal plants are poisoning our atmosphere.

Sen. Tom Saxhaug

Micheletti started out with five primary DEBATABLE points:

1) Mesaba IGCC (integrated gasification combined cycle) is the least cost resource baseload — that we have to consider the life cycle basis, the long term, when we make this determination.

2) Mesaba IGCC provides long term economic benefits

3) Mesaba IGCC provides future flexibility

4) Mesaba IGCC provides significant economic impacts — it’s unique nature lends to promotion of other developments in IGCC

5) Mesaba IGCC is the only coal based technology that affords us opportunities to deal with greenhouse gasses

6) Mesaba IGCC offers consumers the biggest bang for their buck due to emissions reductions and other capabilities

Of course Mesaba’s $2 billion dollar price tag was not addressed; nor the cost/benefit analysis taking into account the extreme costs of this project; flexibility was touted when there is no plan to capture and sequester CO2 or forge the hydrogen economy; there was no distinction between “potential” and “opportunity to realize” and actually doing something; or recognition that the “big bang for the buck” requires far beyond what this project offers.

After this six point introduction, Micheletti sprang into “Bush league” fearmongering straight out of the Karl Rove playbook, citing the Iraq war, our oil crisis, and that four major oil fields are nearing the end of production. “I don’t mean to scare you, but we have to pay attention!” We have an addiction to oil.

Sure, but will someone please explain exactly what an oil addiction has to do with producing electricity using coal gasification? This is a demonstration project for production of electricity, not synfuels for burning, and Micheletti’s equity in this project is based on a Power Purchase Agreement for electricity, not any promise of intervention or treatment of our oil addiction. Utter conflatulance…

He noted that no new electric infrastructure had been built for decades, but he neglected to address the big line in the MISO queue of 16,712MW of generation in the MISO queue waiting for interconnection. Once more with feeling, we “need” 6,300MW of new generation by 2020 in the REGION and have 16,712MW of new generation waiting for interconnection in the MISO queue. That’s 10,000 to spare, and though some projects are dropping off, new ones are added daily. That’s nearly three times what we need. Micheletti says that there is a “significant need for generation, an increase by 20%” but did not address all the new generation in line. Again, here’s that great map found in the CapX2020 study, p. 7:

Look at the new additions at the bottom of the MISO queue, 38740-01 and 38740-02, the two GRE 800MW coal plants in St. Louis County, and remember the words of a former GRE exec who said, “If you let us have transmission, we’ll build coal, if not, we’ll build distributed generation.” Suprise, suprise, they’re building coal.

Micheletti noted that mercury is causing health problems and even worse, particulate matter — he cited a recent article about deaths directly attributable to particulate matter in the atmosphere.

There’s no argument from me on the reductions of emissions that can be achieved with coal gasification, it is significant and it is real. But the noxious toxins show up elsewhere (in coal gasification, it’s in the water).

His comments about sequestration were odd, saying that “We’re looking at piping into North Dakota” and that “lots of money is being spent on this,” but a reading of all submissions note that this Mesaba project only has “capability” of capture, and no where does it plant to capture carbon dioxide, much less do anything with it.

Micheletti kept referring to other things to do with syngas, such as powering engines, or making plastics, but nowhere in any of the Excelsior submissions is there any plan to do anything other than generate electricity.

About transmission, he said that Mesaba is designed to have as little impact as possible, and that for the most part, at least 50% and maybe 80% of the transmission necessary would utilize existing rights of way. He said that Mesaba would connect at Blackberry, and then go to Riverton, and NOT Forbes as previously stated. Riverton? That’s news. And of course there was not mention that in the G-477 MISO interconnection study, only 90MW of the 1,200MW modeled was deliverable to load. THE MISO REPORT HAS BEEN DISAPPEARED. Good thing I saved it, eh? To verify that it’s missing, go to the MISO queue and search for “Itasca” and “St Louis” for the 531MW listings , when you find them, go all the way to right for “X2 Report” and click and…. NADA!!! (This disappearing act is happening all too often on this project).

When asked Mesaba’s cost per MW hour, Micheletti said, “I can’t tell.” I believe he meant that he cannot disclose what it is, as opposed to not being able to ascertain the cost. He said that “with the federal benefits” it’s close if not equal to least cost generation. Well, considering the federal benefits… instead, let’s compare apples to apples.

There was a very odd and difficult to follow/pinpoint discussion about water drainage and usage from Canisteo, and I couldn’t tell if he was saying that they were going to pump it out and then pump it back in, or if it was to be pumped in somewhere else — and of course he wouldn’t take questions from little ol’ moi!

Rep. Loren Solberg

Rep. Loren Solberg had some interesting comments, because for some reason he’d just been out to Big Stone, and said that we have to go forward with Mesaba, because otherwise we’re going to have coal plants going up, but DUH, Big Stone II is happening and is expected to be licensed in South Dakota next summer. This is not binary, build Mesaba or build something else, because the something else will be permitted long before Mesaba gets off the ground. Then what??? And he also said that “We can’t fight Big Stone.” HUH? He can indeed fight Big Stone, we can indeed fight Big Stone — the proceeding is open to Intervention until 3/16/06.

There were other great questions about the market for Mesaba power since it was exempt from Certificate of Need and a Power Purchase Agreement was an “entitlement,” and someone else asked about use of other resources and why this is not paired with renewables and why there is not a push for renewable distributed generation in the area. That was when Solberg said that there wasn’t sufficient wind in the area. HUH? Here’s the state’s wind map == compare Grand Rapids and various sites on the range with Northfield, where St. Olaf is putting up a turbine, and where Carleton’s is spinning as we speak! That’s just as goofy as the people who say we have to generate wind energy and ship it over long transmission lines to Illiniois where they don’t have wind!

Yesterday’s meeting up here in Grand Rapids at the DFL Progressive Caucus got off to an auspicious start — Tom Micheletti couldn’t get his Power Point and computer cooperating, so Linda Castagneri gladly offered her techinical assistance, demonstrating the importance of our electrical mantra, “It’s all connected.” After Micheletti gave a preliminary survey of his presentation, he opened it up to questions as he went, and several instantly raised their hands, including me with a grin! He stared at me and stated that “I’m not taking any questions from Carol!” Really, he said that in public! The Duluth KBJR Ch.11 news crew was there, and I hope they captured it for posterity! His objections? He said:

1) He said that I was an attorney representing people on this. Ummmm, he’s an attorney representing his firm on this? Ja, your point? (CLICK HERE and type in “Micheletti” and “Thomas”).

2) He said that I was from (gasp!) RED WING! Hey, isn’t he from Long Lake? Ja, your point? (CLICK HERE and type in “519 Ferndale”).

He said he’d take questions from anyone from the area, but not from me! Hey, Tom, I represent people from the area, people right next to the proposed Mesaba site! OK, fine… whatever… but of course I got my two cents in anyway.

And as if his saying that once wasn’t enough, he said it a second time, again addressing me by name and prohibiting me from asking questions! What a hoot! He should well know the impact of statements like that! Not long after, Rep. Loren Solberg got up from his seat near one of the organizers and sat right behind me! And it wasn’t because he wanted to discuss anything, he tried to shush me! Too funny! I wonder if that’s because they’d warned beforehand that Micheletti was NOT to get any “difficult questions.” How absurd. Is it that Tom’s not able to handle anything but easy questions, or that there are questions that are too challenging to the project to have the public hear, much less consider? What are they afraid of?

Someone who was present called a friend this morning and said it was “obvious he was afraid of me” and that “he was rude.” A couple of people came up to me afterward offering support, distressed by his behavior, and were concerned that I might be offended. Nope, not at all. I thought it was hilarious!

This was one of the best meetings I’ve been to in a long time. The folks there did a great job asking questions, logical and important questions that were probably “difficult” and I’ll detail that after I get home to RED WING (gasp!), but in the meantime, ponder, WHAT IS MICHELETTI AFRAID OF?

And also in the meantime, check out the coal gasification market penetration scheme, it’s BRILLIANT!

Volume 1

Volume 2

Note the scenarios that they recommend, not a greenfield site from scratch like Mesaba, but coal gasification in conjunction with chemical production or in conjunction with conversion of “distressed” natural gas assets or traditional coal as was done at Wabash River. Huh, you’d think after all of Julie Jorgensen’s NRG experience with natural gas “distressed assets” they could find a good deal on a few!

Procedural Comments on Excelsior Energy’s “mandated” PPA for the Mesaba Project are due today. By “procedural comments” the PUC means that you should tell them whether this matter should be set as a contested case (DUH) and what the scope of the hearing should be.

To look at the Docket thus far, go to www.puc.state.mn.us
Then go to “eDockets” and under “Docket Number” type in “05” and “1993” and you’ll get links to documents filed.

Here’s my Comment: Download file

Send Comments, TODAY (by January 30) @ 4:30 p.m., to:

Burl Haar
Executive Secretary
PUC
121 – 7th Place East, Suite 350
St. Paul, MN 55101-2147

SEND BY FAX BECAUSE TODAY IS THE DEADLINE: (651) 297-7073
and then mail today to address above.