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From the decision:


1. The Minnesota Public Utilities Commission and the Administrative Law Judges have jurisdiction over this matter pursuant to Minn. Stat. §§ 216B.08, 216B.1693, 216B.1694, and 14.50, Minn. R. 1400.5100-.8400, and to the extent not superseded by those rules, Minn. R. 7829.0100-.3200.

2. The Commission gave proper notice of the hearing in this matter, has fulfilled all relevant substantive and procedural requirements of law or rule, and has the authority to take the action proposed.

3. The IEP Statute permits the Commission to amend or modify the initial PPA to raise or lower the amount of the Project’s statutory power sale entitlement.

4. The Project does not satisfy the first prong of the definition of an Innovative Energy Project under Minn. Stat. § 216B.1694, subd. 1(1), because the Final PPA does not assure that coal will be used as the primary fuel and because it has not been established that the Project significantly reduces all of the statutorily identified emissions in comparison to traditional technologies.

5. The Project satisfies the second prong of definition of an Innovative Energy Project under Minn. Stat. § 216B.1694, subd. 1(2), because it is capable of offering a long-term supply contract at a hedged, predictable cost.

6. Since the Project fails to meet the requirements of Minn. Stat. § 216B.1694, subd. 1(1), it is not an “Innovative Energy Project” for purposes of Minn. Stat. § 216B.1694.

7. Since the Project is not an Innovative Energy Project, it does not qualify under Minn. Stat. § 216B.1694, subd. 2(a)(4), as a “Clean Energy Technology” as defined in section 216B.1693.

8. The Final PPA is not in the public interest as required by Minn. Stat. § 216B.1694, subd. 2(a)(7).

9. The Final PPA should not be approved, primarily because of its unreasonable cost to Xcel Energy and its ratepayers, the likelihood that its cost will increase, not decrease over time, and because of the other deficiencies identified in the Findings. While Excelsior Energy and its witnesses have claimed that the PPA cost will become more reasonable in the future, particularly in light of the Project’s environmental benefits, there is not sufficient evidence of that value to overcome the very significant cost difference that exists today.

10. The Project and its technology do not meet the definition of a Clean Energy Technology under Minn. Stat. §216B.1693(c) because they do not significantly reduce all the statutorily identified emissions in comparison to traditional technologies.

11. The Project and its technology do not satisfy the requirements of Minn. Stat. § 216B.1693(a) because the Final PPA is not, and is not likely to be, a least cost resource including the costs of ancillary services and other necessary generation and transmission upgrades.

12. It would be contrary to the public interest for the Project to supply at least two percent of Xcel Energy’s retail load starting in 2012.

Based on the foregoing Conclusions, and for reasons set forth in the following Memorandum, the Administrative Law Judges make the following:


IT IS HEREBY RESPECTFULLY RECOMMENDED that the Public Utilities Commission order:

1. That Excelsior Energy’s Petition asking the Commission to approve, amend, or modify the terms and conditions of the Final PPA under Minn. Stat. § 216B.1694 be DENIED and that the Final PPA be DISAPPROVED.

2. That if the Commission approves the Final PPA, that it first be amended through negotiations among Excelsior Energy, Xcel Energy, and the Department to address the deficiencies identified in this Report, then returned to the Commission for final approval.

3. That Excelsior Energy’s Petition asking the Commission to determine under Minn. Stat. § 216B.1693 that the Project and its IGCC technology is, or is likely to be, a least-cost resource, thus obligating Xcel Energy to use the plant’s generation for at least two percent of the energy supplied to its retail customers, be DENIED.

4. That Excelsior Energy’s Petition asking the Commission to determine that, under the terms of Minn. Stat. § 216B.1693, at least 13 percent of the energy supplied to Xcel Energy’s retail customers should come from the Units I and II of the Mesaba Energy Project by 2013 be considered in Phase 2 of this matter.

Dated: April 12, 2007

/s/ Steve M. Mihalchick
Administrative Law Judge

/s/ Bruce H. Johnson
Administrative Law Judge


  1. Alan Muller Says:

    Congratulations! An incredible effort by many people but above all: Carol Overland.

  2. Sumner Crosby Says:

    Way To GO! My hope is that this decision will help many other decision-makers, in other states all over the country, that “Clean” coal is nothing but a misnomer. Thank you to Carol and all of you who helped the ALJ and PUC see the light!

  3. Stephanie Henriksen Says:

    Congratulations to Carol and all who worked on this! The words “denied” and “disapproved” sort of stand out, don’t they.

  4. S. Earl Jarosh Says:

    Having known Carol since her sax playing rose colored glasses days, I too applaud Carol’s efforts but for different reasons. I have no problem with the concept of exploring experimental technologies like IGCC but to create a business plan that relies on a PPA for forced sale of its product for success is inappropiate. It is experimental and possibly cleaner on the surface but not for what is required to produce the end product. It is certainly not innovative having been developed in the 1800’s. Straight coal fired plants are still more efficient, cleaner, and far cheaper. If the IGCC business wants to invest in itself to stand on its own and power companies on the grid across the country wish to buy its product Then that would be smart business.

    This is why our law makers should not legislate percentages of required renewable and clean energy. There will be more innovative energy technologies in the coming years re-classifing themselves to make money off the regulated portion of the energy infrastructure.

  5. Carol A. Overland Says:

    So does that mean I no longer have rose-colored delusions?

    But you see how we get at the same result coming around different ways?

    I really LOVE doing the “let the market decide” because the rabid capitalists squeal so loudly when their get rich quick scheme doesn’t cash flow.

    And you’re on the big problem here, a mandate is establishing a market where there is none, be it legislating IGCC or a Renewable Energy Standard. They blew their legitimate means of getting wind on when they agreed to transmission that facilitates massive coal construction, for a teeny bit of wind on those lines. The enviros sold us all out on that, and are only now starting to see. With that NRDC and ED deal in Texas with TXU, oh barf…

    But the Mesaba project is going down, the Delaware NRG coal gasification is going down too.

    Speaking of deader than dead, we are winning on the “tank farm” the tank course and machine gun and bazooka shooting range. Seems EQB thinks they need a little environmental review, and we’ll see how that pans out.

    Oh yes, we are sure having fun now!

  6. Terrie Gent Says:

    Can folks around the country provide me with information about proposed IGCC plants. My e-mail is TerrieGent@aol.com. A company wants to build an IGCC plant in our rural southeastern Arizona county and I’d like to know how IGCC is being received around the country. Thank you in advance for providing information.

  7. Legalectric » Blog Archive » Like Pawlenty, Minner is toady for IGCC Says:

    […] Gov. Minner puts her credibility on the line for NRG? Why? IGCC (coal gasification) is the biggest boondoggle to come down the pike. The people of Delaware are not aware of the details of the NRG proposal because it has been kept shrouded in secrecy. But it’s all public information in Minnesota’s Excelsior Energy docket about the PPA for the Mesaba Project. ALJs’ Decision Here […]

  8. Legalectric » Blog Archive » Mesaba spinnin’ it against gravity Says:

    […] Once more with feeling: IGCC is TOO EXPENSIVE! […]

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