Coal gas boondoggle circling the drain

There hasn’t been much coverage about the Minnesota Public Utilities Commission meeting from this past Thursday. Two decisions regarding my least favorite Iron Range economic development project emerged from that meeting. As you may know, Excelsior Energy is proposing the Mesaba Energy Project, a coal-gas power plant for the Iron Range. The project enjoys a good deal of support from the elected officials on the Iron Range but has also attracted well-organized citizen opposition. I continue to repeat and repeat and repeat that this project is a boondoggle that will never produce jobs or electricity.

Anyway, here’s the dispatch from a fellow Itasca County resident and MinnesotaBrown reader who was at the meeting:

1) The PUC ruled that transmission infrastructure for the Mesaba Energy Project IS exempt from a Certificate of Need as is stated in Minn. Stat. § 216B.1694, but Excelsior Energy still has to have routing and environmental permitting reviews completed on the route(s). This allows EE to move forward with preliminary design, but no construction. (If they have the money to do so, which is a big question mark.)It is possible that Minnesota Power will take this to the courts.

2) The PUC denied Excelsior Energy’s petition for an unlimited stay on the (Power Purchase Agreement) for Phase II. This means that the PUC will address the PPA for Phase II and hopefully soon!

For the uninitiated, the “power purchase agreement” has to do with a 2003 state law in which several local legislators tried to mandate that Xcel Energy buy power from Excelsior, which was then (and remains) essentially a collection of lobbyists and consultants raising money off the government. The cost of this unique kind of “clean coal” plant is enormous and Excelsior would be unable to gain financing without a guaranteed customer.

Anyway, Thursday’s meeting means that the PUC will decide relatively soon on this power purchase agreement. Anti-Mesaba comments from several members of the PUC indicate that the jig is up. If the current PUC is to vote on this issue they are likely to deny the PPA and effectively kill this lousy excuse for a “jobs” project.

UPDATE: Sunday’s Grand Rapids Herald-Review reports on the PUC meeting. Relying solely on an interview with Excelsior’s co-CEO Tom Micheletti and a confounded Minnesota Power PR rep, the story misses the point. Micheletti and Excelsior have thrived up here because so few local media types understand the energy business or the nature of this project. Anyway, here is Micheletti’s desperate spin on Thursday:

“It went very well,” said Excelsior Energy CEO Tom Micheletti by phone about the hearing in St. Paul after it was completed.

Micheletti felt the transmission issue was the more important of the two petitions before the MPUC. He also did not have any qualms about expressing his disdain for Minnesota Power, which asked the MPUC to delay a decision on transmission infrastructure until final action on the power purchase agreement has been taken.

“They (Minnesota Power) are taking frivolous and unwarranted positions on state law,” Micheletti said. “I have a new name for them. ARP. Anti Range Power. And you can quote me on that.”

Ha Ha! They DID quote him! Of course, Minnesota Power has been making power on the Iron Range for almost 100 damn years. Excelsior never will. So, you know. I have a new name for them. BSF. The first word is “Bull” and the last one is “Factory.” I’ll let you figure out that middle word.

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Comments

Carol Overland says

April 13, 2008 at 11:40 am

Aaron – thanks for keeping this in the public eye. The vote on the transmission issue was important, and there were three for it, and two against. Boyd and Chair Koppendrayer voted NO, and Reha, O’Brien and Pugh voted yes. Pugh’s statements were odd, initiating the motion to approve it, and stating that the Dept. of Commerce’s position on it was “moving.” HUH? When they were discussing it, Commerce wasn’t even at the table, and they got Marya White to come up to speak to it. Where were the Asst. AGs who represent Commerce? Very strange. I have six pages of notes but they’re so rough, I’ll probably have them posted some time tomorrow. http://www.legalectric.org

Thanks for keeping on them. BSF indeed!

Aaron J. Brown says

April 13, 2008 at 3:17 pm

Thanks Carol — yeah, that 3-2 vote is puzzling, but maybe Pugh didn’t want to take a stand on that particular vote. I suspect there will be some last minute gamesmenship up here on the Range before the final PUC vote. I was surprised that there were no symbolic votes put up at the legislature this year (I guess it’s not over yet.)

Thanks for your update … I’ll look forward to your post.
AB