MINNEAPOLIS (May 8, 2023) – Xcel Energy is proposing to add an additional 250-megawatt solar project near the existing Sherco plant site in Becker, Minnesota, which will soon be home to the Upper Midwest’s largest solar development and represents an important piece of the company’s clean energy future.
Today, Xcel Energy is asking the Minnesota Public Utilities Commission to add a third solar array adjacent to the 460-megawatt Sherco Solar project already under construction. The three solar projects are expected to be complete by the end of 2025 and will replace the capacity of the Sherco plant’s first coal unit that is scheduled to retire later this year. As part of its expansion of solar energy it delivers to customers, Xcel Energy is also proposing to purchase power from the 100-megawatt Apple River solar project being developed in northwest Wisconsin.
Sherco Solar is among the largest solar developments in the U.S. and is key to Xcel Energy’s plans to nearly triple the amount of solar on its Upper Midwest system by 2028. The combined projects’ 710-megawatt capacity will generate enough electricity to power more than 150,000 homes each year on average. Solar energy does not have any fuel costs and contributes to a diversified energy mix, which helps protect against rising fuel prices. Xcel Energy expects to qualify for federal tax credits that make construction more affordable, helping customers save money.
“These projects will be the lowest-cost solar on our Upper Midwest system and demonstrate our focus on clean energy without compromising affordability,” said Chris Clark, president, Xcel Energy – Minnesota, South Dakota, and North Dakota. “We are committed to moving the Sherco Solar project forward to deliver significant new clean energy to our customers and communities.”
“These solar projects continue our leadership in providing carbon-free energy to customers in the states we serve,” said Karl Hoesly, president, Xcel Energy – Wisconsin and Michigan. “Through their development, these projects also help our communities by creating jobs and supporting local businesses.”
Xcel Energy would develop, own, and operate the third Sherco Solar array. Last fall, the PUC approved the first two solar projects at the Sherco plant site. Construction began on the first project in late April.
Sherco is key to clean, affordable energy
Xcel Energy and its partners will build the solar projects adjacent to the Sherco plant, allowing the company to reuse the facility’s existing grid connections. That will provide customers with power in the most efficient and cost-effective way.
The projects will help meet Xcel Energy customers’ energy needs as the company transitions from coal. Xcel Energy is on track to reduce carbon emissions 85% from customers’ electricity in the Upper Midwest by 2030. The company plans to retire all of its coal units by the end of 2030.
The Sherco site plays an important role in the company’s vision to deliver 100% clean energy in Minnesota by 2040, meeting the state’s new benchmark. Xcel Energy’s proposed Minnesota Energy Connection transmission line will link at least 2,000 megawatts of new renewable energy to the grid at Sherco. The company is also seeking state approval on a long-duration battery storage pilot project at the facility.
Commitment to local economy
The projects will provide economic benefits in Becker and the surrounding area. If approved, the third Sherco Solar array will create an estimated 95 union construction jobs in addition to the 300 construction jobs created by the first two solar projects, plus 18 ongoing operations and maintenance jobs. Sherco Solar will use Xcel Energy’s Power Up workforce and development program, designed to integrate women and people of color who are underrepresented in the utility industry and building trades.
“Construction of Sherco Solar will create hundreds of family-supporting jobs and economic opportunities for LIUNA members, whose hard work keeps the lights on today, and open new doors to underrepresented workers through the Building Strong Communities apprenticeship readiness program,” said Joel Smith, president and business manager, Laborers’ International Union of North America—Minnesota and North Dakota. “Expanding the project is a smart way to create even more jobs while putting existing transmission infrastructure to work delivering clean energy to meet our state’s 100% goal.”
Xcel Energy is committed to a smooth transition for its employees at the Sherco plant, who have played a vital role in powering the region for decades. The company has transitioned other Minnesota coal plants without layoffs, and the company expects to accomplish this again at the Sherco facility.
If approved, the third Sherco Solar array will create an estimated $110 million in payments to landowners and local taxes, in addition to the estimated $240 million in local economic benefits from the first two solar projects. The company is also working with the state and local communities to bring new jobs and investments to areas affected by the coal plant retirements.
Meanwhile, the company is proposing a 20-year agreement to purchase power from the Apple River solar project being developed by National Grid Renewables in Polk County, Wisconsin. It will be the largest solar project in northwest Wisconsin and one of the largest in the state.
The Apple River project will create an estimated 150 union construction jobs, plus $19 million in payments to landowners and $4 million in payments to local governments over the 20 years of the agreement.