Xcel officials explain how planned closing of biomass plant to proceed

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District 17 State Sen. Andrew Lang, red shirt, and District 17A Rep. Tim Miller, center, met with the Benson City Council Monday night discussing their role in helping the city get compensation from the Legislature and Xcel Energy for the planned purchase and demolition of Benson Power, LLC. The city is scheduled to get $20 million for economic development over four years between 2018 and 2021.

By Reed Anfinson
Publisher
Swift County Monitor-News

With Xcel Energy’s filing with the Minnesota Public Utilities Commission June 30 for approval to purchase the Benson Power, LLC, biomass power plant the next phase that could lead to its shutdown and demolition is underway.

The request also asks that the Power Purchase Agreement obligating Xcel to buy Benson Power’s electricity for the next 10 years be terminated. In addition, Xcel made four other filings with the PUC related to ending the state’s biomass mandate requiring it to buy power produced from wood chips, turkey litter and other biomass.

“The overall goal of all of these filings is the same: to lower customer costs while continuing to provide safe, reliable service,” it states in its PUC filing. “If approved by the Commission, these initiatives together will achieve over $531 million in total cost savings (nominally) for our customers over the next 10 years.”

The PUC’s decision isn’t expected to come until the end of this year as it reviews Xcel’s Energy’s 266-page public filing as well as a private filing dealing with confidential business data. Because it also does business in North Dakota, Xcel Energy has filed for approval of the agreement with its PUC as well.

During the 2017 Minnesota Legislative session that ended in late May, Xcel Energy and the City of Benson worked to get language passed into law that would allow the power company to move ahead with closing Benson Power, but at the same time compensate the city for its loss.

Benson power employs 45 people directly with another 50 to 60 people employed by companies who drive trucks that bring turkey litter and wood chips to the plant. Additional employees work at the companies that supply Benson Power with biomass fuel.

At the time the plant was built in 2005, the Minnesota Department of Employment and Economic Development estimated that its operation would have an $8 to $10 million annual impact on the local economy. It pays $758,157 in local real estate taxes annually - $404,058 to the city alone.

Their joint effort, spearheaded locally by Benson City Manager Rob Wolfington along with the help of District 17 Sen. Andrew Lang and District 17A Rep. Tim Miller, ended with legislation passing that compensates Benson for the loss of the plant with $20 million. The city is to receive four cash payments starting with $4 million June 1, 2018. That $4 million payment is to be followed by two $6.5 million payments in each 2019 and 2020, and then a final $3 million payment in 2021.

The city will receive another $3 million in compensation for infrastructure investments it made to facilitate the plant’s operation. Xcel will also continue to pay the full real estate taxes for two years after the plant is torn down. Xcel will pay for the demolition and offer to sell back to the city a bare lot for economic development....

 

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Pictured: District 17 State Sen. Andrew Lang, red shirt, and District 17A Rep. Tim Miller, center, met with the Benson City Council Monday night discussing their role in helping the city get compensation from the Legislature and Xcel Energy for the planned purchase and demolition of Benson Power, LLC. The city is scheduled to get $20 million for economic development over four years between 2018 and 2021.

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