Legalectric

How to work up excitement about the Certificate of Need rulemaking???  On its own, it’s dry, detailed, wonkish stuff, thrilling only to those of us who live and breathe need decisions and utility infrastructure siting and routing… but may there’s some pizazz in the machinations surrounding input, like lack of public representation on the Advisory Committee such that even my tremendous bulk doesn’t even it out.  Does Xcel deserve THREE representatives? ITC two?  “Participating Utilities” two, “Wind Coalition” one and none for Goodhue Wind Truth?  Here’s the list:

Advisory Committee Contact List

Plus they’re not posting the drafts on the rulemaking site, so the public has no idea what’s being proposed:

7849 June 5 DRAFT New

And minutes from the first meeting:

Synopsis – May 29 meeting

To get to the docket, go to www.puc.state.mn.us and then “search eDockets” and search for 12-1246.

We’ll be talking about the Certificate of Need criteria next, and here’s what’s proposed:

7849.0120 CRITERIA CERTIFICATE OF NEED REQUIREMENTS.

   A certificate of need must be granted to the applicant on determining that:

  Subpart 1. Need Demonstration. An applicant for a certificate of need must demonstrate that the demand for electricity cannot be met more cost effectively through energy conservation and load-management measures.

Subpart 2. Renewable Resource Preferred. An applicant proposing an LEGF that uses a nonrenewable energy source must demonstrate that it has considered the use of renewable energy sources, as required under Minnesota Statutes section 216B.243, subd. 3a.

Subpart 3. Assessment of Need Criteria. In evaluating a certificate of need application, the

commission shall consider the criteria contained in Minnesota Statutes, section 216B.243, subd. 3, as well as the following:

     A.  whether the probable result of denial would be an adverse effect upon the future adequacy, reliability, or efficiency of energy supply to the applicant, to the applicant’s customers, or to the people of Minnesota and neighboring states, considering: the region;

                (1)  the accuracy of the applicant’s forecast of demand for the type of energy that would be supplied by the proposed facility;

                  (2) the effects of the applicant’s existing or expected conservation programs and state and federal conservation programs;

      (3)  the effects of promotional practices of the applicant that may have given rise to the

increase in the energy demand, particularly promotional practices which have occurred since 1974;

      (4) B. the ability of current facilities and planned facilities not requiring certificates of need to meet the future demand; and

      (5)  the effect of the proposed facility, or a suitable modification thereof, in making efficient use of resources;

             B C.  whether a more reasonable and prudent alternative to the proposed facility has not been demonstrated by a preponderance of the evidence on the record, considering:;

                (1)  D. the appropriateness of the size, the type, and the timing of the proposed facility compared to those of reasonable alternatives;

      (2) E. the cost of the proposed facility and the cost of energy to be supplied by the proposed facility compared to the costs of reasonable alternatives and the cost of energy that would be supplied by reasonable alternatives;

              (3) F. the effects of the proposed facility upon the natural and socioeconomic environments compared to the effects of reasonable alternatives; and

                (4) G.  the expected reliability of the proposed facility compared to the expected reliability of reasonable alternatives;

             C.   by a preponderance of the evidence on the record, the proposed facility, or a suitable modification of the facility, will provide benefits to society in a manner compatible with protecting the natural and socioeconomic environments, including human health, considering:

                (1) the relationship of the proposed facility, or a suitable modification thereof, to overall state energy needs;

      (2) H. the effects of the proposed facility, or a suitable modification thereof, upon the natural and socioeconomic environments compared to the effects of not building the facility;

                (3) I.  the effects of the proposed facility, or a suitable modification thereof, in inducing future development; and

                (4) J. the socially beneficial uses of the output of the proposed facility, or a suitable modification thereof, including its uses to protect or enhance environmental quality; and.

             D.   the record does not demonstrate that the design, construction, or operation of the proposed facility, or a suitable modification of the facility, will fail to comply with relevant policies, rules, and regulations of other state and federal agencies and local governments.

Otter Tail Power has withdrawn from Big Stone II.  Odd way to put it because Big Stone II IS Otter Tail Power.  OTP was the big one left in the game and now they’re gone.

Otter Tail Power has withdrawn from the Big Stone II coal plant.  Really?!?!?

Pinch me, I must be dreaming…

Here’s their post about it on their BSII site – love the euphemisims:

Big Stone II announces participant changes

Otter Tail Power Company withdraws; Project pursues new participants

(Fargo, ND – September 11, 2009)—The participating utilities announced today the withdrawal of Otter Tail Power Company from the Big Stone II Project, a planned 500-to-600-megawatt coal-fired power plant located near Milbank, South Dakota, and its associated transmission. The remaining participants emphasized that Big Stone II will go forward if sufficient participants can be found to join the project.

Tom Heller, CEO of Missouri River Energy Services, which has the project’s largest share, stated that Big Stone II is still the least-cost, environmentally sound baseload power plant for the remaining project participants. “Big Stone II is a fully permitted project that will provide participants’ customers with least-cost generation for decades. It will improve the emissions profile of the existing Big Stone Plant, and the transmission facilities will be sized to serve the region’s burgeoning wind energy development,” he said.

While Heller conveyed the project’s regret that Otter Tail had to withdraw, he said other potential new participants have expressed interest in joining the project and exploratory discussions are underway.

The current Big Stone II Project participants are Central Minnesota Municipal Power Agency, Heartland Consumers Power District, Missouri River Energy Services and Montana-Dakota Utilities Co.

In the first blurb to come over the wire, below, there’s one phrase that stands out:

have resulted in challenging credit
and equity markets that make proceeding with Big Stone II at this time
untenable for Otter Tail’s customers and shareholders.

I knew that financing was not happening and dependent on a big cash infusion from Bill Gates. Financing anything now is pert near impossible, hence the big cost allocation dust up for CapX lately, and Big Stone II was no exception.  Who on earth, who in their right mind, would invest in a coal plant today?  That falls squarely in the “HOW STUPID CAN WE BE” category, no doubt about it.

I‘ll post more as it turns up.  From Marketwatch:

Otter Tail Power Company Announces Withdrawal From Big Stone II

FERGUS
FALLS, Minn., Sep 11, 2009 (GlobeNewswire via COMTEX) — Otter Tail
Power Company today announced its withdrawal — both as a participating
utility and as the project’s lead developer — from Big Stone II, a
500-to-600-megawatt coal-fired power plant proposed for near Milbank,
South Dakota, with related transmission upgrades in South Dakota and
Minnesota.

According
to Otter Tail Power Company President and CEO Chuck MacFarlane, the
broad economic downturn coupled with a high level of uncertainty
associated with proposed federal climate legislation and existing
federal environmental regulation have resulted in challenging credit
and equity markets that make proceeding with Big Stone II at this time
untenable for Otter Tail’s customers and shareholders.

MacFarlane
explained that Big Stone II contractual agreements require a commitment
to proceed after the project receives all major permits, creating a
financial obligation on each party that agrees to go forward. “Each Big
Stone II participant is in a different position in terms of means and
impact of raising capital and mechanisms for recovering those costs
from customers,” he said. “Given the legislative and regulatory
uncertainties and current economic conditions, Otter Tail Power Company
is unwilling to create a binding financial obligation of approximately
$400 million for its share of the project at this time.”

Big
Stone II had been scheduled to be on line in 2011, and now the plant
would not begin operating until late 2015 at the earliest. MacFarlane
said that the company no longer could delay the project to obtain
greater clarity on — and to mitigate — risks unique to Otter Tail.
Accordingly, Otter Tail chose to withdraw and allow the others to
proceed. “We believe the project is important for the region, both in
terms of adding baseload power and enhancing regional reliability,”
MacFarlane said.

While
Otter Tail Power Company has invested more than $300 million in wind
energy generation during the last three years, MacFarlane added that
dispatchable generation remains an important need for Otter Tail Power
Company’s customers. As a result, over the next three to six months,
Otter Tail Power Company will continue to evaluate other options to
meet its customers’ need for reliable electricity.

MacFarlane
also expressed his company’s gratitude for the backing shown for the
project. “Our company appreciates the support that customers,
regulators, labor, business leaders, and political leadership have
shown the project. We especially thank South Dakota elected officials
and communities within the plant’s vicinity for their commitment,” he
said.

Yeah, he’s got pie on his face, all right… or is it egg…

Alan would put the headline as “PUC HELPS BILL GATES BUILD COAL PLANTS!”

Anyway, the meeting is Tuesday, TOMORROW… and, well, not Bill Gates directly, but his Cascade Investments.   They’re on the PUC agenda tomorrow.   Cascade Investments is providing the $$$ to Otter Tail Power build the Big Stone II coal plant, and without Cascade Investments, the Big Stone II coal plant doesn’t get built.

Here’s the Comment that I just sent in:

Overland Comment on Standstill Agmt – 09-656

Otter Tail Power and Cascade Investments are on the agenda at the PUC, item #5, where they’re asking for approval of a “Standstill Agreement” that would allow them to operate in a way prohibited by state law:

TOMORROW’S PUC AGENDA

PUC Staff Briefing Papers – 8/25/09

Cascade Investments (Bill Gates) is a major investor in Otter Tail Power.  You’d think he’d get that building coal plants is not a good investment these days, but nooooooo, there he goes!  Over 10% of Otter Tail Power and wanting more, apparently!  But wait, Minnesota law limits how investors with over 10% interest and corporations can act:

Minn. Stat. 302A.673

And here’s where it gets interesting.  OES Staff asked what they’re contemplating that would not be possible under Minn. Stat. 302A.673, and they say “business loans.”  But as staff noted, business loans are fine, that’s not an issue, it’s more stock that is an issue!  Yet despite this non-responsive response, Staff recommends the PUC approve OTP’s and Cascade’s agreement.  SAY WHAT??

Otter Tail Power Filing & Standstill Agreement

OES Comment 1

Otter Tail Power Reply

OES Comment 2

PUC Meeting Notice

So tell me, why should OTP get special treatment?  This was an issue that the OES Staff noted was not common, had not even been reviewed before!!!

1)NOTICE SUCKED – look at the service list for OTP’s filing, and PUC Notice

2) OTP is asking for special treatment

3) OES asked questions about why and OTP did not answer them satisfactorily

4)What’s the impact on ratepayers?  On shareholders? (not that PUC can, or should, have any concern about that!)

5) OTP has burden

6) OTP  hasn’t met it

7) Petition should be denied

Makes sense to me…

EEEEEEE-HAAAAAAAA!  A big stake in its slimy little heart…

Hot off the press from Sierra Club and Clean Water Action, who have been working tirelessly against Otter Tail Power’s Big Stone II coal plant, the Big Stone II air permit is upende

Big Stone II – EPA Objection to Air Permit

Here’s their press release in toto:

FOR IMMEDIATE RELEASE:

CONTACT:

Virginia Cramer, Sierra Club 804-519-8449
Darrell Gerber, Clean Water Action 612-802-5372

Date: January 23, 2009

Big Stone II Sent Back to the Drawing Board
U.S. Environmental Protection Agency Concerned About Pollution, Global Warming

Washington, DC – Less than three days after the Bush Administration left office, the Environmental Protection Agency (EPA) has overturned the State of South Dakota’s approval of the massive Big Stone II coal-fired power plant.  The EPA’s decision comes after the state failed to require state-of-the-art pollution controls for the coal plant that would address concerns about harmful soot, smog and global warming pollution.

“This is a great day not only for clean energy and people’s health, it’s a victory for the rule of law,” said Bruce Nilles, Director of the Sierra Club’s Move Beyond Coal Campaign. “EPA is signaling that it is back to enforcing longstanding legal requirements fairly and consistently nationwide,” added Nilles.

As the first major coal plant decision by the EPA since President Obama took office, this decision signals that the dozens of other coal plant proposals currently in permitting processes nationwide will face a new level of federal scrutiny. Sierra Club and Clean Water Action have been working to stop the Big Stone II project and ramp up clean energy investments in for more than three years.

“Today EPA took the first step toward restoring science and integrity to its work and recognizing the very real need to reduce air pollution from coal-fired power plants,” said Darrell Gerber, Clean Water Action Program Coordinator.  “Downwind residents and the region’s natural resources will be better protected.”

This decision likely spells the end of Otter Tail Power’s Big Stone II coal plant.  While for the past eight years the Bush Administration has refused to regulate global warming pollution, even after being ordered to do so by the US Supreme Court, President Obama has pledged that the US will cut global warming pollution and do its part to avoid the worst consequences of climate change. With coal-fired power plants accounting for almost 30% of our nation’s carbon dioxide emissions, burning less coal and investing in clean energy such as wind and solar instead is a common sense approach to helping meet global warming pollution reduction goals. The proposed Big Stone II 500-megawatt coal plant would have emitted more than 4 million tons of global pollution annually.

At a minimum, Otter Tail Power will have to go back to the drawing board and redesign the project to incorporate the best and maximum available control technology for pollution like soot and smog.  Sierra Club and Clean Water Action will be pushing for EPA to set limits also for carbon dioxide, the main contributor to global warming.

“Otter Tail Power will now have to be responsible for the cost of its pollution,” said Nilles. “We hope that this increasing cost of coal will encourage Otter Tail Power, along with Governors Pawlenty and Rounds, to harness the clean and affordable wind resources available in the region. Minnesota and South Dakota should be leaders on the path to renewable energy independence, not laggards proposing 19th century coal plants.”

###

Now, can we get them to end Excelsior Energy’s Mesaba Project?