‘Coal holiday bill’ would make seasonal shutdowns possible

What would happen if coal-burning electricity plants shut down during the spring and fall, when demand is lower? That’s what Xcel Energy wanted to know, so, in December, it asked the Public Utilities Commission if it could find out.

But it’s unclear in state law whether such a pilot project is permissible.

It would be under HF3209.

Sponsored by Rep. Zack Stephenson (DFL-Coon Rapids), the bill would require utilities to analyze the economic and environmental costs and benefits of seasonal shutdowns of their nonrenewable energy sources.

At Tuesday’s meeting of the House Energy and Climate Finance and Policy Division, the bill was laid over for possible inclusion in an omnibus energy and climate bill. It has no Senate companion.

Rep. Zack Stephenson

Stephenson calls it the “Coal Holiday Bill,” and the impetus for it came from Xcel, which wanted to idle a pair of plants in the spring and fall. According to its filing with the Public Utilities Commission, that would save customers an estimated $55 million over a three-year period.

“The old model for these coal power plants is that they needed to essentially run all the time to be an economic proposition,” Stephenson said. “But there’s substantial evidence that ratepayers can save significant amounts of money if plants are idled, particularly in the spring and fall, when load is lower and there’s less demand. … This bill is about providing utilities with the option of being able to take advantage of those savings.”

Stephenson said the bill features what he called a “show your homework” section, in that utilities would be required to explain how seasonal shutdowns would make economic sense for them.

Isabel Ricker, senior policy associate for Fresh Energy, said, “Xcel’s analysis shows that this would save customers between $90 million and $130 million over nine years, and reduce carbon dioxide emissions by 65%.”

Rick Evans, director of regional government affairs for Xcel Energy, also spoke in support of the bill.

“You do your modeling, and you come out with an idea of how this might work,” he said. “But we really don’t know until we try it. This will give the PUC the authority to approve this kind of dispatch and provides enough safeguards.”

Two amendments offered by the division’s Republican lead, Rep. Chris Swedzinski (R-Ghent), were defeated. But they started a conversation that continued through two other bills, which propose requiring utilities report to customers on electric generation sources and renewable energy programs: That they could result in significant work and expense for small rural and municipal electrical cooperatives.