Minnesota Power plans to retire Cohasset coal plant, go carbon-free by 2050

Updated: 5:09 p.m.

Just 15 years ago, Minnesota Power was producing 95 percent of its electricity from coal.

But after investing heavily in wind and large hydropower projects in Canada, last month the utility became the first in the state to reach the milestone of producing half its energy from renewable sources.

And now, the company has announced a goal of delivering 100 percent carbon-free electricity to its customers by 2050.

The state’s second-largest utility, which serves about 145,000 homes and businesses in northeastern Minnesota, intends to submit its strategy for the next 15 years to the Minnesota Public Utilities Commission on Feb. 1 as part of its integrated resource plan.

Minnesota Power said it plans to reach 70 percent renewables by 2030 by adding 400 megawatts of new wind and solar generation. It also plans to stop burning coal at its last remaining coal-fired power plant in Cohasset, Minn., by 2035.

“It's really fulfilling our commitment to the climate, our customers and our communities,” said President and CEO Bethany Owen, who called the announcement a “continuation of the journey we've been on for many years to provide increasingly cleaner energy.”

Minnesota Power is not the first utility in the state to pledge that it will reach 100 percent carbon-free electric generation by 2050. Xcel, the state’s largest utility, first made that commitment in December 2018, when it became the first utility in the country to do so.

Since then, many major utilities nationwide have followed suit, as the price of renewable energy technology like wind and solar has plummeted, often leaving coal as the most expensive option.

Currently, Minnesota Power generates about 30 percent of its electricity from its two remaining coal-fired generators at the Boswell Energy Center in Cohasset.

The utility plans to retire the smaller of those units in 2030, and to transform the other unit to become “coal-free” 2035.

"We think overall, and directionally, this is absolutely fantastic news,” said Allen Gleckner with the Twin Cities-based nonprofit Fresh Energy, which works to speed the transition to clean energy. "With this announcement, we have announced retirement dates for all major coal plants in Minnesota."

Xcel Energy, the state's largest utility, has committed to closing its coal-fired power plants in Bayport and Becker within the next decade.

In Cohasset, Minn., Mayor Greg Hagy said Itasca County and his city are hugely reliant on Minnesota Power's Boswell power plant, which employs 165 people in a town of only about 2,700.

"It's approximately 20 percent of the tax base for the county,” Hagy said. “It's bumping over 50 percent of the tax base for our city. And so yeah, we're gonna have to make some drastic changes to compensate."

Cohasset has known this announcement was coming, at some point. Hagy said he's glad they have nine years to try to prepare for what comes next.

While Minnesota Power didn’t specify to what power source it would convert the last generator at Boswell, Gleckner said he was confident it would be a carbon-free source, potentially solar combined with energy storage.

While environmental groups largely celebrated Minnesota Power's announcement, they're continuing to push back on one part of the utility's overall plan.

Minnesota Power has proposed building a $700 million natural gas power plant in Superior, Wis. Natural gas burns cleaner than coal, but it's still a fossil fuel and a major contributor to climate change.

Minnesota and Wisconsin utility regulators have approved the project, but the Minnesota Court of Appeals ruled that the state should have conducted a review of the power plant’s environmental impacts. The state Supreme Court is weighing whether to uphold or overturn that ruling.

"Natural gas will play a modest but important role to ensure reliable and affordable transition to 100 percent carbon-free energy,” said Owen with Minnesota Power.

Environmental groups argue that renewable technologies are a better fit to replace the electricity from coal that Minnesota Power is losing.

The Sierra Club says wind and solar are better options for Minnesota Power.

"We know that clean energy can meet the same needs that utilities are looking for in fossil gas,” said Jessica Tritsch with the Sierra Club. “Wind, solar energy efficiency, these all are cost effective solutions. And now, the cost of energy storage is going down as well."

One of the unique challenges Minnesota Power faces is its heavy industrial load.

About 64 percent of the electricity the company generates feeds the region’s six taconite mines and processing plants, as well as other large industrial customers like paper mills, that require huge amounts of electricity, 24 hours a day, seven days a week.

Owen said she hopes the Minnesota Public Utilities Commission will sign off on the utility’s plans by the end of the year.

"To ensure that we're meeting our responsibility to our customers, and our communities and our employees, this plan lays out a thoughtful timeframe,” Owen said.

Minnesota Power will submit its plan to Minnesota utility regulators on February 1st. The utility hopes for approval by the end of the year.

The plan should move the state closer to its goal of reducing greenhouse gas emissions from 2005 levels by 80 percent by 2050.

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