Plan saves $2.2 billion and cuts more carbon emissions
Minnesotans across the state are ready for clean, affordable and reliable energy. Xcel’s IRP won’t deliver this -- but our proposed “Clean Energy for All” plan will.
On February 11, 2021, Sierra Club submitted its comments on Xcel Energy’s Integrated Resource Plan (IRP) to the Minnesota Public Utilities Commission (PUC). We were disappointed in Xcel’s continued reliance on dirty, fossil gas and lack of access to community solar. (For a full review of Xcel’s IRP, check out our 2020 Report Card on Xcel).
Meanwhile, Sierra Club’s alternative “Clean Energy for All” plan would both save ratepayers $2.2 billion dollars and cut carbon when compared to Xcel’s IRP. As we’ve heard from the thousands of Minnesotans who have submitted comments on Xcel’s IRP, Minnesotans want clean, affordable, reliable energy that will support a resilient economy while reducing carbon emissions. We have the opportunity to do just that, and reach 100% carbon-free electricity by 2040, if not sooner. All while expanding community and rooftop solar and addressing inequities in our energy system.
Sierra Club’s “Clean Energy for All” plan keeps Xcel’s plans to retire its coal plants by 2030. It maximizes energy efficiency and builds even more wind and solar to meet new energy needs, instead of proposing to build a new fossil gas plant or extending the life of the Monticello nuclear plant. It also includes dramatically higher levels of distributed solar and community solar, solar paired with storage, and standalone battery storage. Our experts found that our plan will save customers more than $2.2 billion over the planning period (2020-2034) compared to Xcel’s plan and would set the utility on a trajectory to reduce its carbon emissions to 100% by 2040 or sooner.
Here’s an overview of how our Clean Energy for All plan compares to Xcel’s IRP:
Some of our largest concerns with Xcel’s IRP center around the utility’s plans for expanded fossil gas and limited community and rooftop solar, and a lack of focus on racial justice.
Fossil Gas Plant and Pipeline in Becker
Xcel’s Proposal: Build a huge (800 MW) fossil gas plant and pipeline in Becker, MN; Also consider adding significantly more fossil gas (1700 MW) beginning in 2031
Sierra Club’s Clean Energy for All Plan: NO NEW GAS
Xcel’s proposed fossil gas plant is bad for the climate and bad for customers. The plant and accompanying gas pipeline would cost customers, not shareholders, over $1 billion to build. Given that Minnesota is considering a 100% carbon-free energy by 2040 policy and the Biden administration included a goal of 100% carbon-free energy by 2035 in one of his climate executive orders, Xcel customers could be stuck paying off hundreds of millions of debt if the gas plant needs to close early to meet carbon targets. These costs would disproportionately burden low-income customers.
As for climate, Sierra Club analysis shows that the proposed plant would emit 3.6 million metric tons of carbon annually (including emissions from gas extraction and transportation). That’s as much as putting 777,757 cars on the road, or as much as building almost another full sized coal plant. We cannot be building new fossil fuel infrastructure in a climate crisis, especially when Minnesota is already not on track to meet its greenhouse gas reduction goals.
Sierra Club analysis of Xcel’s IRP, using the same modeling methodology as Xcel, shows that building the Sherco gas plant and pipeline leads to a resource plan that is $200 million more expensive for customers. Our expert also found that Xcel’s claims that the gas plant was needed for reliability of the power system are unfounded.
Sierra Club’s Clean Energy for All Plan includes no new fossil gas, which is better for both our climate and for customers.
Community & Distributed Solar
Xcel’s Proposal: Includes only minimal additional rooftop and community solar by 2035
Sierra Club’s Clean Energy for All Plan: Projects 2,050 MW of community solar and adds 1,851 MW distributed solar.
Solar on people’s homes and businesses and in their local communities provides electricity where it is needed, cuts electricity costs for customers, and reduces the need to burn fossil fuels. Minnesota’s community solar program gives Xcel customers the opportunity to see these benefits without the upfront costs or roof space needed for rooftop solar. Community and rooftop solar are important for making solar accessible for renters and Black, Indigenous, and Latinx communities.
Many energy experts say an electricity grid with large amounts of distributed generation is more efficient, more resilient, and more reliable, given energy is produced close to where it’s used. And the more community and rooftop solar we build, the less need we’ll have for big centralized power plants and long distance transmission lines.
A recent study by Vibrant Clean Energy found that high levels of distributed generation can deliver significant cost savings while creating 2 million more jobs nationally. That would mean more than 30,000 jobs for Minnesota.
But because Xcel Energy does not own these projects, they cut into Xcel’s profits. Xcel has lobbied to shrink or end the community solar program at the legislature. And in its resource plan, it vastly underestimates the amount of community and consumer owned solar that can economically be built over the next 15 years. To give a sense of how much, Xcel’s current forecast assumes a community solar growth rate that is two-thirds lower than the historical average.
Sierra Club’s Clean Energy for All Plan forecasts more than twice the level of community solar investment as Xcel’s, and seven times more distributed solar generation. This element alone is critical to maximizing socioeconomic benefits for Minnesotans by creating jobs and expanding access to clean energy.
Xcel would still need additional programs, proposed outside of this IRP, to ensure that the customers who currently have the least access to the benefits of clean energy – BIPOC and low-income Minnesotans, and renters – can participate in community solar, distributed generation, and energy efficiency programs.
Racial Justice
Xcel’s Proposal: The resource plan mentions that Xcel will look for fair access to clean energy programs, jobs and economic development opportunities as it invests in clean energy. However, there are not enough firm commitments and details on how Xcel will ensure this is prioritized.
Sierra Club’s Comments: Sierra Club’s Clean Energy For All Plan would deliver greater, more equitable socioeconomic benefits that will help Minnesota communities recover from the COVID crisis.
Xcel acknowledges in its plan the need to address racial inequities in our energy system, yet the plan continues to exacerbate those inequities.
Building a new gas plant will contribute to the climate crisis, which we know will disproportionately impact Black, Indigenous, and Latinx communities more than white communities. It will also cost customers over $200 million over clean energy, with increased burden falling on low-income and Black, Indigenous and Latinx communities.
Efforts to stifle community and rooftop solar generation reduces opportunities to solar access to those who would benefit most - renters, low-income ratepayers and people of color.
And while Xcel’s proposals to expand low-income energy efficiency, access to solar, and diversify their workforce are steps in the right direction, they are not sufficient. Currently, Xcel’s workforce is 93% white, which means they need concrete goals and benchmarks to ensure they diversify.
Sierra Club’s plan is lower cost and less polluting, avoiding the gas plant and investing heavily in clean energy. But we know that to ensure the benefits go to communities most impacted by environmental injustice and communities facing loss of a power plant, Xcel will need to develop more targeted programs.
In our comments, we called for Xcel to work with community stakeholders (and pay for their time) to expand and develop programs to increase access to solar and energy efficiency, set diversity metrics for their hiring, and commit to not renewing its contract with the HERC incinerator in Minneapolis.
You can read our full comments online.
How To Get Involved
We need your voice and your support to make the Clean Energy For All plan a reality. Click here to tell the Minnesota Public Utilities Commission to say NO to Xcel’s proposed fracked gas plant and YES to 100% clean, renewable energy. By keeping up the public pressure, we can show the Minnesota Public Utilities Commission and Xcel Energy that Minnesotans are ready to move beyond fossil fuels and transition to 100% clean, renewable energy.