End times for Excelsior’s Mesaba project?

The state PUC almost killed the Mesaba Energy Project yesterday. Readers of this blog know I’ve been wailing away at this boondoggle for a long time. It’s encouraging that the commissioners are starting to realize the risks and trends involved in this “clean coal” debacle.

The only thing that caused the PUC to hold off on completely killing the project was one commissioner’s statement that the legislature and governor “want” this project and that it’s not the PUC’s place to kill it. That tells me that the last stand for this risky, overpriced project will occur during the upcoming legislative session. Excelsior will expend every remaining dollar in their coffers to flood the field with lobbyists.

Now for the reckoning.

PUC cools to idea of ‘clean coal’ plant on Iron Range
Commissioners sounded pessimistic on the proposed Iron Range facility but didn’t ax it.
By H.J. Cummins, Star Tribune
Last update: November 01, 2007 – 9:57 PM

Minnesota regulators Thursday came close to scrapping a plan to compel the state’s energy companies to buy from a proposed $2 billion “clean coal” plant.

Citing growing disillusionment with coal, and assurances from several utilities that they have their energy needs covered, the Minnesota Public Utilities Commission nearly rescinded its Aug. 30 directive to the state’s utility companies: that they try to buy from the proposed coal gasification plant when they go shopping for new power sources for the next 10 to 20 years.

The commission stopped short — for now — but only after a series of pessimistic prognoses for the Excelsior Energy plant proposed for Minnesota’s Iron Range.

“We have a whole paradigm shift now,” said commission Chairman Leroy Koppendrayer, pointing to news accounts that coal gasification plants have been delayed or canceled in Colorado, Florida and Arizona.

“We don’t ever want to foreclose on the future,” Commissioner Phyllis Reha said, “but I think we’re all in agreement that what we have in front of us isn’t going to fly.”
It was the latest setback in a two-year process for Excelsior, including an administrative law judges’ advisory ruling in April that the project is “not in the public interest.”

Still, Excelsior is not without some victories. It received a $36 million clean-energy grant last spring, and it heard last month that it’s on a short list for possible loan guarantees from the U.S. Department of Energy.


  1. Aaron, Like you, I have to say this project is the one I find most worrisome. I just don’t trust it. If it’s so darn clean, why do that have to haul coal all the way here to process it? I just don’t buy it. If it’s so darned “clean” then why don’t they process it where it’s being mined, and save the additional transportation costs? Could it be that people where it’s being mined understand the coal industry better, and would be too wise to the dangers?

  2. Steve,

    The reason is it is a power plant with gasification. The processing takes place just prior to the electricity generation, the only alternative would be to have a pipeline from the coal fields that would transport the hydrogen that the plant uses after it has been converted or to have the plant be near the coal fields and then have transmission lines to Minnesota.

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