Great River Energy suspends its Lignite Vision 21 study
Elk River, MN (December 31, 2002) Today, Great River Energy informed the North Dakota Industrial Commission (NDIC) that it has suspended its Lignite Vision 21 feasibility study to build a new coal-based power plant in North Dakota. Great River Energy will return $500,000 in grant money for the study to the North Dakota Industrial Commission (NDIC), as specified in the grant contract.
“We are not proceeding with the Lignite Vision 21 study primarily because our latest load projections indicate an intermediate, or combined cycle, power plant in Minnesota would better serve the needs of our customers,” said Tim Seck, leader of Great River Energy’s baseload study team. “Whether a baseload plant in North Dakota remains a future option for Great River Energy may hinge on the cost and regulatory risk associated with the necessary transmission upgrades.”
The life cycle cost (the present value of capital and operating costs over the life of the project) for transmission to carry the energy to Great River Energy’s customers in Minnesota is significantly greater than other options GRE is considering. Furthermore, transmission policy is in an unprecedented state of flux adding additional regulatory risk.
“We began the feasibility study of a new plant in North Dakota because of the state’s excellent lignite resource, quality workforce and favorable business climate,” said Seck. “However, despite all the benefits those factors bring to a project, they could not offset the regulatory risk and high cost of transmission.”
The Lignite Vision 21 Project included a grant/loan of up to $10 million from the North Dakota Industrial Commission (NDIC) to perform feasibility studies. However, the contract stipulated that Great River Energy repay the NDIC for the state’s cost share in the study, $500,000.
Great River Energy’s decision to suspend the feasibility study does not foreclose building a plant in North Dakota in the future. When the transmission and environmental polices are firmed up, GRE will re-evaluate building a plant in North Dakota if a new plant is needed.
Great River Energy currently owns and operates two power plants in North Dakota. Coal Creek Station, a 1081MW facility located near Underwood, is North Dakota’s largest power plant, employing more than 200 people. Stanton Station, a 186MW facility located near Stanton, employs nearly 75 people.
Great River Energy is a generation and transmission cooperative owned by 29 distribution cooperatives in Minnesota and Wisconsin. It provides energy and related services to those cooperative members.
###
