Inside Clean Energy: With Planned Closing of North Dakota Coal Plant, Energy Transition Comes Home to Rural America

The move may signal a turning point for rural cooperatives, which have been slow to embrace renewable energy.

May 14, 2020
The Coal Creek electric power plant in North Dakota will soon close. Credit: Karen Bleier/AFP via Getty Images

The Coal Creek electric power plant in North Dakota will soon close. Credit: Karen Bleier/AFP via Getty Images

Inside Clean Energy

Great River Energy has announced it will close the largest coal-fired power plant in North Dakota and replace it with renewable sources, an almost complete overhaul of the way the utility provides electricity to the smaller rural electric cooperatives it serves.

The plan made me sit up and take notice because rural electric cooperatives have been slow to move away from coal and embrace renewables. These cooperatives serve only about 12 percent of the nation's customers, but they operate a disproportionately large share of coal-fired power plants across the country.

Great River says it is taking these actions because the coal plant has become too expensive and customers increasingly want renewable energy. Headquartered in the suburbs of Minneapolis, the nonprofit produces electricity and delivers it to 28 rural electric cooperative utilities that have a total of about 700,000 customers.

Great River's announcement comes about a month after another company that serves rural electric cooperatives, Tri-State in Colorado, announced a plan to allow its members to generate more renewable energy.

 

I'm not going to call this a trend quite yet, but we may look back on this year as a turning point for rural electric cooperatives in embracing the transition to clean energy.

"It's one of these cool win-win-wins that you don't often get to see in working on energy issues," said John Farrell, a co-director of the Institute for Local Self-Reliance in Minneapolis, an advocate for giving communities and consumers more control over their energy production.

Farrell's organization has criticized rural electric cooperatives for not listening enough to their members and being hostile to renewable energy.

Map: Closing Coal Creek Station

Great River said on May 7 that it will close Coal Creek Station, located in central North Dakota, in 2022, marking the end of the only coal-fired power plant in the United States with the word "coal" in its name. The 1,151-megawatt plant went online in 1979 and has been the workhorse for a company that has depended on coal to produce the majority of its electricity.

In just a few years, the company's use of fossil fuels will flip almost completely, going from about 60 percent coal to zero, and from about 25 percent wind to about 60 percent. 

"We are building a power supply portfolio that will serve our member-owner cooperatives for decades," said David Saggau, Great River's president and CEO, in a statement.

The plan also includes the conversion of a 99-megawatt coal plant to run on natural gas, and a pilot project for a battery system capable of running for 150 hours on a single charge. (More on the battery in a moment.)

Since wind is an intermittent resource, the output from the new wind farms won't completely replace what Great River is losing from the coal plant, so the company is planning to increase its purchases from the regional wholesale market to fill any gaps.

Great River had previously said that the costs of operating Coal Creek Station were becoming too high. This was even though the plant is located next to a coal mine, which virtually eliminates the cost of transporting the fuel. The main economic challenge for the plant is that competing sources of electricity—mainly natural gas and renewables—have gotten much less expensive.

But this is a painful decision, costing about 260 jobs and taking away a major part of the property tax base in a North Dakota county that has about 10,000 residents.

Some of North Dakota's elected officials, all Republicans, responded to the news by vowing to look for ways to keep the plant open, which may include trying to find a buyer.

The most important part of Great River's announcement might be its effect on other companies that generate power for rural electric cooperatives and might also be considering what to do with aging coal plants.

Farrell said that these companies tend to look to each other for guidance, so there is a good chance that a big move by one or two of them will be imitated by others. As this happens, I'll let you know.

A New Utility-Scale Battery Will Be Able to Run for Days

While there are many interesting elements in Great River's announcement, the most meaningful for the global energy transition may be something that was mentioned by the company almost as an afterthought: the battery storage system that is capable of running for 150 hours on one charge.

This is a potentially huge step in developing a battery that can help maintain a reliable grid at times of extreme weather or when wind or solar are underperforming. But the key word is "potentially," because all we have now is a news release and a plan to have something built by 2023.

The battery would be 1 megawatt, enough to power a very small town, which is tiny compared to some of the super-size lithium-ion battery projects being carried out across the country. But it would be capable of running for days, as opposed to a quick burst of a few hours that is typical of existing battery systems.

The key player here is Form Energy, a start-up in the Boston area co-founded by a former Tesla executive, Mateo Jaramillo. It will manufacture the battery, which will be located in Cambridge, Minnesota, a small city north of Minneapolis-St. Paul.

I asked George Crabtree, director of the Joint Center for Energy Storage Research at Argonne National Laboratory, what to make of all this.

He said the battery technology is likely to be inexpensive, based on Form Energy's description of the system as an "aqueous air battery." "Aqueous" is a way of saying that the battery uses water as one of the main components, as opposed to the costly and complex liquid used in lithium-ion batteries.

"Lithium-ion gets prohibitively expensive if you try to make a battery that lasts longer than four hours," Crabtree said. In contrast, the Form Energy project seems to be able "to make the battery cheap enough that it can discharge for 150 hours without costing you an arm and a leg."

Battery storage is a vital part of building a grid that is capable of phasing out fossil fuels, because wind and solar are intermittent energy sources. Crabtree sees this project as an intriguing step that is "totally different from everything else" on the market today.

I asked Form Energy for some details about the physical size, cost and chemical makeup of the project. A spokeswoman answered the first question—the battery system will cover about one acre—but said the company isn't ready to disclose any more specifics.

Amid Covid-19 Delays, Wind and Solar Projects to Get Extra Time to Qualify for Tax Credits

It looks like the federal government is going to add some wiggle room to deadlines for renewable energy tax credits that otherwise were going to be phased out or reduced at the end of this year, in a response to delays caused by the coronavirus pandemic. 

This follows a request by senators from both political parties asking for the U.S. Treasury Department to take the action. While the changes are not yet official, a department official said in a letter last week that the office "plans to modify the relevant rules in the near future."

Credit: Scott Olson/Getty Images

The solar investment tax credit began a three-year phaseout this year, with the value of the credit set to decrease for projects started after Dec. 31. Also, the country's leading wind energy tax credit is set to expire at the end of this year.

"Projects that have been waylaid by the economic disruptions of this pandemic can now proceed with more certainty," said Sen. Charles Grassley (R-Iowa), one of the people who had urged this action.

Clean energy advocates have been pressing Congress for multi-year extensions of the tax credits, an effort that has run up against opposition from the Trump administration. This action by the Treasury Department would fall far short what advocates want, but it's better than nothing at a difficult time.

Inside Clean Energy is ICN's weekly bulletin of news and analysis about the energy transition. Send news tips and questions to dan.gearino@insideclimatenews.org.

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