Rochester-based power provider pledges to be 80 percent carbon-free in 10 years

A Rochester-based nonprofit power provider plans to produce 80 percent of its electricity from carbon-free sources by 2030.

The Southern Minnesota Municipal Power Agency provides electricity to 18 city-owned utilities, mostly in the southern and central parts of the state, including Rochester, Austin, Owatonna and Mora.

Currently the agency gets much of its power from the coal-fired Sherco 3 power plant in Becker, Minn. SMMPA owns a 41 percent stake in the generating unit. But Sherco 3’s majority owner, Xcel Energy, announced last year it intends to retire the plant in 2030.

SMMPA expects all its outstanding debt on the unit will be paid off in 2027.

With the declining costs of wind and solar, SMMPA spokesperson Chris Schoenherr said it makes sense to replace most of that coal-fired electricity with renewables.

"It will probably be an equal mix of wind and solar. We may have to add a little gas generation, but primarily wind and solar,” he said.

The plan would result in a 90 percent reduction in CO2 emissions from 2005 levels.

SMMPA currently obtains a little over 20 percent of its power from renewable sources, Schoenherr said. It also gets carbon-free electricity from hydropower projects.

The power agency won't have to replace all the electricity it will lose from Sherco in 10 years. Two of its biggest member utilities, Rochester and Austin, plan to go out on their own a decade from now. Rochester has set a goal to get 100 percent of its electricity from carbon-free sources by 2030.

Xcel has pledged to generate 100 percent of its electricity from carbon-free sources by 2050. But SMMPA isn’t yet ready to make that commitment, Schoenherr said.

“While we are optimistic that technological breakthroughs are on the horizon, (but) the cost of achieving the last 10-20 percent reduction in carbon emissions in the power sector is currently projected to be prohibitively high with today’s technology,” said Dave Geschwind, executive director and CEO, in a statement.

“We believe society will need to evaluate whether further reductions beyond 80 percent in this sector are the most economical and practical path to deep carbon reductions economy-wide.”

In November 2019, SMMPA announced plans to build an electric vehicle charging network to connect its member communities. The agency sees “range anxiety,” where drivers are unwilling to drive long distances for fear of not having a place to charge their vehicle, as being one of the biggest barriers to more widespread adoption of EVs.

SMMPA is in the process of identifying sites to locate the fast chargers, Schoenherr said.