Topic sections
Project
- Why is this project necessary?
- What have the individual utilities' integrated resource plans shown?
- How many customers do the participants serve?
- What would this plant cost to build?
- What's the estimated service life of the plant?
- How would this plant fit in to Minnesota Renewable Energy Objective strategies, given that the state wants 10% renewables by 2015?
- What major regulatory approvals are necessary?
- What fuel source are you proposing for this project?
- Will the route to bring fuel to the plant have adequate rail?
- How would constructing this plant benefit Minnesota customers and Minnesota energy policy?
- How would building this plant improve reliability?
- Will downsizing the plant mean a change in the need for transmission?
- Why has the project changed its scheduled on-line date?
- Why did Great River Energy and Southern Minnesota Municipal Power Agency exit the Big Stone II Project?
Environment
- What air emissions controls would this plant use?
- What would be done to control mercury?
- Are you using any externality values in your evaluation process?
- What impact would this project have on Big Stone Lake?
- Will the use of groundwater impact the rights of other users?
- Will this project require an environmental impact study?
- Does this project have potential to back down less efficient plants so there would be fewer emissions overall?
- What are you doing to minimize environmental controversy?
Alternatives
- What alternative generation possibilities are you considering?
- What about IGCC (integrated gas combined cycle)?
Economics
- What's the cost of electricity from this plant?
- How would the cost of this plant per kwh compare with alternatives?
- How would Big Stone II impact rates?
South Dakota
Why is this project necessary? Conservative estimates by the Mid-Continent Area Power Pool indicate that electricity consumption in our region will increase by as much as 15% over the next decade. Resource Data International estimates that meeting the increased consumption will require adding more than 9,300 megawatts of capacity in the MAPP region by 2012.
For many years, MAPP has been one of the nation's most reliable systems. However, according to RDI, MAPP had less than 2,700 megawatts scheduled to come on line within the next several years. That's 6,300 megawatts less than the region will require. Because it takes four to six years to plan, site, and build a baseload generating plant, we need to act soon to prevent a supply problem.
The Federal Energy Regulatory Commission has been working for a number of years to develop a competitive wholesale market by opening up access on the bulk transmission system. MAPP historically has been a low-cost region in the country. The competitive wholesale market has allowed higher cost areas outside of MAPP to access the generating facilities within MAPP. This has driven up prices and reduced the available supply. If we do not build, we can expect that relying on purchases from others will become increasingly more expensive.
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What have the individual utilities' integrated resource plans shown? Each of the five co-owners of the Big Stone II project has recently analyzed the growing demand for electricity among their customers and members, and developed forecasts of the resources required to serve those needs. Based on these forecasts, the co-owners have modeled and tested various resource alternatives, and have independently concluded that construction of Big Stone II and its associated transmission facilities, along with a combination of renewable energy, natural gas generation and energy conservation, is the best, least-cost plan for their customers and members. In addition to the 500-580-megawatt Big Stone II plant, the co-owners plans call for the addition of over 850-megawatts of wind plus 100 megawatts of other renewable energy by 2015.
Two of the co-owners are required to file Integrated Resource Plans on a regular basis with the Minnesota Public Utilities commission. Links to those IRPs are below:• Otter Tail Power Company - View Otter Tail Power Comapny's resource plan.
• Missouri River Energy Services (MRES) - View the MRES Resource Plan.
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How many people do the participants serve?
The participants serve more than a million people.
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What would this plant cost to build? Based on the most recent design refinements, the project, including transmission, is expected to cost $1.6 billion. Efforts continue to maximize efficiencies and minimize costs.
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What's the estimated service life of the plant? 40 years or longer.
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How would this plant fit in to Minnesota Renewable Energy Objective strategies, given that the state wants 10 % renewables by 2015? Otter Tail Power Company expects to comply with the Minnesota REO across its entire system but still will need some baseload resources to serve its load. Other participants who are subject to the Minnesota REO also expect to comply.
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What major regulatory approvals are necessary? Application for the following permits began in the first half of 2005.
• Federal Environmental Impact Statement (EIS)
South Dakota
• Plant site
• Air permit
• Water appropriations
• Solid waste
• Transmission line route permit
Minnesota
• IRP approval
• Certificate of Need for the transmission line
• Transmission line route permit
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What fuel source are you proposing for this project? The primary fuel source would be Powder River Basin coal.
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Will the route to bring fuel to the plant have adequate rail? Yes.
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How would constructing this plant benefit Minnesota customers and Minnesota energy policy? This plant would provide an economical, increasingly clean, reliable source of power. And it's possible that the required transmission upgrades could provide opportunities for the development of renewables.
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How would building this plant improve reliability? The plant itself would provide another source of dispatchable baseload energy. In addition, the transmission system would be strengthened.
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Will downsizing the plant mean a change in the need for transmission? No. The regional transmission operator has indicated that the plant would have to be downsized to 150-200 megawatts before the transmission project would require reconsideration.
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Why has the project changed its scheduled on-line date? The project's original on-line date was mid-2011. That date was based on the timely receipt of needed permits. However, lengthy delays in the permitting process have required the participants to revise the on-line date to mid-2013.
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Why did Great River Energy and Southern Minnesota Municipal Power Agency exit the Big Stone II Project? GRE exited the project primarily because its load forecast changed due to changes in the way some of its member cooperatives will buy future power and capacity. SMMPA left the project due to an unresolved internal lawsuit involving its largest member utility. SMMPA felt it could not commit large financial resources to Big Stone II.
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Environment
What air emissions controls would this plant use? Big Stone II air emissions would be controlled with highly effective control technologies. As a general comparison, Big Stone II would emit less of the following than existing coal-fired resources that meet current permitting levels:
• Particulate (PM 10) - Bag house technology would control fine particles.
• Sulfur dioxide (SO2) - 4% to 5% that of existing plants (one-seventh of the current levels from just Big Stone I)
• Nitrogen oxides (NOx) - 5% to 10% that of existing plants (equal to or less than levels from just Big Stone I)
• Carbon dioxide (CO2) -
20% less than the existing regional fleet of power plants
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What would be done to control mercury? The Big Stone II participants are committed to removing 90 percent of mercury emissions from the Big Stone site. The commitment mirrors the 2006 Minnesota Mercury Reduction Act, one of the nation's most stringent mercury-reduction statutes.
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Are you using any externality values in your evaluation process? Yes. We are using the most current environmental externality values prescribed in Minnesota.
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What impact would this project have on Big Stone Lake? Big Stone II should have a minimal impact on Big Stone Lake because it would use water from the lake only if the lake level were above normal standards. If the lake level were below normal standards, the plant would use stored water. Neither city nor rural water systems would be used as back up.
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Will the use of groundwater impact the rights of other users? Engineering and hydrological modeling shows that using groundwater from the Veblen aquifer will not impact the rights of other water users. Using groundwater will, however, allow the Big Stone II participants to avoid having to construct an additional storage pond on the plant site.
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Will this project require an environmental impact study? Yes.
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Does this project have potential to back down less efficient plants so there would be fewer emissions overall? The potential exists because the plant's highly efficient design would make it a low-cost generating station. This means that the electricity it would generate would be dispatched before that from older, less environmentally friendly plants.
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What are you doing to minimize environmental controversy? Because the environment is a primary concern, we involved stakeholders as early as possible in the study effort. We intend to ensure that, if built, the plant would be equipped with state-of-the-art mercury, sulfur dioxide, nitrogen oxides, and particulate emissions controls. From a transmission site perspective, once the studies are complete we'll make efforts to minimize the impact to the environment by optimizing the use of existing corridors.
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Alternatives
What alternative generation possibilities are you considering? Remember, this is a project that may be part of five utilities' plans. You may have to ask each utility about its plans. Here is a brief review of Otter Tail Power Company's and Missouri River Energy Services' plans:
Otter Tail Power Company personnel considered the following in the most recent integrated resource plan:
• Pulverized coal - sub critical and super critical
• Atmospheric circulating fluidized bed coal
• Natural gas combined cycle
• Long term capacity and energy purchases
• Simple cycle combustion turbines - aeroderivative and heavy-duty
• Integrated gasification combined cycle
• Wind
• Conservation
• Solar photovoltaic
• Hydroelectric
• Pumped storage hydroelectric
• Phosphoric acid fuel cell
• Landfill gas
• Microturbines
• Biomass
• Anaerobic digestion
Missouri River Energy Services. In its continuing efforts toward economical, reliable and responsible resource planning, MRES is considering additional power supply options, including:
• Construction of additional fossil-based resources, including participation in a separate coal-fired plant, as well as construction of natural gas-fired peaking units
• Construction of additional renewable energy, including wind, biomass, and compressed air storage
• Short-term or long-term purchases from neighboring utilities
• Upgrades to existing coal unit (LRS)
• Additional efforts to encourage consumer conservation
• Additional efforts to encourage load management
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What about IGCC (integrated gas combined cycle)? We have investigated integrated gas combined cycle generation for this project and determined that it is not a commercially viable option. IGCC plants that have been built have been much smaller than this Big Stone II proposal and have required government funding. None of the plants use sub-bituminous coal. For more information on IGCC technology go to the U.S. Department of Energy web site.
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Economics
What's the cost of electricity from this plant? The output cost depends on financing costs, which are different for each participating company. Nevertheless, this plant should result in the most cost-effective baseload resource.
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How would the cost of this plant per kwh compare with alternatives? A cost per kwh comparison doesn't tell the whole story. Various generating alternatives provide different services beyond just kilowatt-hours. The question should be: How well does the resource fit in with your other resources and what is the total cost to the customer. Only our pending integrated resource plans can answer that.
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How would Big Stone II impact rates?
• For Otter Tail Power Company the impact on rates would be determined as part of the resource planning process. Big Stone II would be more expensive than Otter Tail Power Company's other plants because the company hasn't built a base load plant since 1981. Construction costs have gone up in the last 25 years. And new environmental standards will require expensive controls.
• Missouri River Energy Services. It is premature to make any cost projections with any level of confidence until the project details are more defined. MRES has long held the belief that owning our own resources has a much greater stabilizing impact on our rates than if we were dependent on the volatile fluctuations of the market. Having a new, state-of-the-art generating resource, should provide greater efficiencies to the MRES generating mix and support our projected load growth.
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South Dakota
• To take advantage of this brown field (existing) site that has existing infrastructure for a second unit. This keeps the cost down and minimizes the environmental disruption. Building on this site also will result in cost decreases to the existing facility through the sharing of resources.
• The location is closer to the loads of the current potential co-owners than other sites in North Dakota. This minimizes the transmission line requirements.
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How will project sponsors get local government and landowners involved? The personnel and companies connected with the existing Big Stone Plant have a long history of working with local communities through economic development (helping to develop Northern Lights Ethanol, for example) and working with Big Stone restoration groups on lake quality and lake level issues. They have discussed the concept of a Big Stone II with local community members in the past and the idea was well received.
Because our experience has shown that the more we communicate with others the more successful we will be, we will begin working with the Big Stone City and Milbank school district, city commissioners, county commissioners, and other local public officials and community members as soon as possible. Regarding transmission, Minnesota has a defined public meeting process that we will follow in addition to our other outreach efforts.
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