A state administrative law judge has found that a 100 MW solar power project by renewable energy developer Geronimo Energy is a more economical and environmentally sound way to meet future electricity demand than the construction of natural gas-fired power plants. Judge Eric Lipman of the Minnesota Office of Administrative Hearings told the state's largest electric utility, Xcel Energy (Xcel), that Geronimo Energy's $250 million Aurora Solar Project would provide "the greatest value to Minnesota's and Xcel's ratepayers" over several alternative proposals that called for the use of gas turbines. The state RPS program requires that 31.5% of Xcel's electricity sales come from renewable sources by 2020. A 1.5% carve-out for solar was adopted in 2013, as well as a 10% solar generation requirement for retail electricity sales by 2030. Xcel has told regulators that it will require anywhere from 25 to 500 MW of new generation capacity to meet anticipated demand by 2019.
Judge Lipman's recommendation includes the state requirement that all new energy generation projects be subject to competitive bidding, but it was the first time a U.S. solar power project has been declared cost-competitive against natural gas when evaluated head-to-head. The recommendation must still be adopted by Minnesota's Public Utilities Commission to become binding. As currently structured, the project would receive a 30% federal investment tax credit, but would not otherwise benefit from government subsidies. Xcel's proposal called for the construction of new gas-fired generation capacity at its 538 MW Black Dog Generation Station, which currently burns coal and gas. It also proposed adding 430 MW of gas-fired generation at a to-be constructed North Dakota site known as the Red River Valley Generating Station. In recommending solar, Judge Lipman expressed strong support for "scalable projects" that could be built in stages as Xcel works to meet near-term power shortfalls through 2017. Judge Lipman noted that while the specifics of Xcel's future generation requirements remain uncertain, the statutory requirement to add solar generation resources to its system was a clear and immediate need.
Below is the link to the opinion:
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