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Appeals court strikes approval of Superior gas plant, cites need for environmental study

Appeals court strikes approval of Superior gas plant, cites need for environmental study

Nemadji Trail Energy Center

The Wisconsin Public Service Commission voted Thursday to approve construction of the Nemadji Trail Energy Center, a $700 million natural gas generating facility to be built in Superior by Dairyland Power Cooperative and Minnesota Power. 

Plans to build a natural-gas-fired power plant in Superior suffered a setback Monday when a Minnesota court overturned approval of the project.

The state’s Court of Appeals said the Minnesota Public Utilities Commission must consider environmental consequences before approving contracts for the 525-megawatt Nemadji Trail Energy Center, proposed by Minnesota Power and Dairyland Power Cooperative. Minnesota regulators previously denied a request to conduct an environmental assessment, saying that would be up to Wisconsin.

The appeals court said construction and operation of the plant would affect the surrounding environment, “most notably through the large quantities of carbon dioxide that the plant will emit.” The court ruled that nothing in Minnesota’s environmental review law limits jurisdiction to projects physically within the state.

Environmental groups opposed to the project, including the Sierra Club and the Minnesota Center for Environmental Advocacy, hailed the ruling as a win for the environment and customers alike. They urged Minnesota Power, a subsidiary of ALLETE, to pursue clean energy instead.

“This ruling sends the strong message that Minnesota utilities can’t ignore or sidestep the environmental and public health risks of burning fossil fuels,” said Jessica Tritsch, senior campaign representative with the Beyond Coal to Clean Energy Campaign in Minnesota.

The Wisconsin Public Service Commission is now considering Dairyland’s application to build the plant, which would provide electricity to the wholesale market. It is expected to issue its decision in January.

Because costs of the plant will not be passed directly to ratepayers, the Wisconsin PSC declined to consider the impacts of the plant’s greenhouse gas emissions.

Minnesota Power issued a statement expressing disappointment in the appeals court’s “unprecedented decision” and saying environmental review has never been applied to a project beyond the state’s borders. The company said it is “considering all our options.”

“We feel the rigorous and thorough review by Wisconsin regulators that is currently underway will adequately address any environmental concerns and the steps we are taking to mitigate any environmental impact,” the statement said.

It’s not clear how Monday’s ruling could affect plans for the plant, which is scheduled to begin operations in 2024. Dairyland Power referred questions to Minnesota Power, whose spokeswoman said they are still reviewing the ruling’s impact on the timeline.

The utilities have argued the plant is needed to allow them to move away from coal-fired generation and that it would support the addition of more clean energy sources like wind and solar.

The Sierra Club and Clean Wisconsin have opposed the project in Wisconsin.

The mayor of Superior and 20 state lawmakers, including Senate Minority Leader Jennifer Shilling, have filed letters of support for the project that largely mimic Dairyland’s talking points about the project’s benefits.

Last fall the Rocky Mountain Institute published a study that found 90 percent of 88 proposed natural gas plants — including Nemadji Trail — would end up costing more than if the utilities instead invested in wind, solar and energy efficiency.

Over the past two decades, Wisconsin utilities have built a dozen natural-gas-fired plants with a combined capacity of more than 3,800 megawatts, according to the U.S. Energy Information Administration. Alliant Energy’s 700-megawatt West Riverside Energy Center is scheduled to begin operation early next year. Together, those plants would account for about a quarter of the state’s generation capacity.

Last year more than three-quarters of Wisconsin’s electricity was produced with coal and natural gas, according to EIA data.

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