Xcel Energy announced an agreement today (Oct 3) with a wide array of key stakeholders that will advance the company's ambitious carbon reductions while ensuring customers continue to have the reliable, safe and affordable electric service they depend on.
The agreement clears the way for Xcel Energy's Upper Midwest Energy Plan, under which carbon emissions reductions from 2005 levels are expected to exceed 80% by 2030, potentially reaching up to 88%. It includes new investments in battery energy storage systems, wind and solar power, and a natural-gas fired power plant, while extending the lives of Xcel Energy's two carbon-free nuclear plants.
"This plan invests in innovation that maximizes value for customers, creates jobs, and supports the communities we serve," said Ryan Long, president of Xcel Energy Minnesota, South Dakota and North Dakota. "We're making great progress toward our vision for reliable, affordable, 100% carbon-free electricity, and we appreciate the support of our stakeholders on an agreement that allows us to keep building the clean energy economy of the future."
The agreement will keep costs low for customers by unlocking tax credit savings from the Inflation Reduction Act for renewable generation and energy storage. In addition, by continuing the operation of Xcel Energy's nuclear plants, customers will benefit from the affordable, always-available, carbon-free electricity the plants generate.
Xcel Energy, the Minnesota Department of Commerce, clean energy organizations, labor unions, and energy developers reached the agreement. The public will have an opportunity to provide comments through the Minnesota Public Utilities Commission process, and a final decision is expected in early 2025.
The agreement includes:
- Adding 3,200 megawatts of wind energy by 2030, connecting to the Upper Midwest grid at the Sherco plant site in Becker, Minnesota using the proposed Minnesota Energy Connection transmission line.
- Adding 400 megawatts of solar energy by 2030, connecting to the grid at the A.S. King plant site in Oak Park Heights, Minnesota.
- Adding 600 megawatts of battery energy storage by 2030, in addition to a 300-megawatt lithium-ion battery at the Sherco plant site, allowing the company to store low-cost wind and solar energy for when it's needed.
- Extending the use of Xcel Energy's two carbon-free nuclear plants at Prairie Island and Monticello through the early 2050s.
- Building a hydrogen-capable natural gas-fired power plant in Lyon County, Minnesota, to back up renewables and supply power during critical times while also providing grid stability for the proposed Minnesota Energy Connection transmission line from the Sherco site to Lyon County.
- A commitment to continue development of a thermal heat battery pilot and bring a proposal to the Commission in 2025.
These proposed resources are in addition to projects that have already received approval from regulators. Xcel Energy was the first electric provider in the U.S. to set a vision to deliver 100% carbon-free electricity and has committed to retiring all of its coal plants by 2030.
Xcel Energy's Upper Midwest electric system serves Minnesota, Wisconsin, North Dakota, South Dakota and Michigan. Electric use in the region is expected to grow more significantly in the coming years, and this plan meets the needs of customers into the future with a goal of keeping energy prices as low as possible.
Xcel Energy has closed or converted 24 coal units across the eight states it serves without layoffs and will work with employees, communities and stakeholders to ensure that anyone working at the retiring Sherco and King coal plants who wants a job with Xcel Energy will have one. The company is also committed to supporting union construction jobs and apprenticeship pathways for local workers to build the clean energy economy of the future.
About Xcel Energy
Xcel Energy (NASDAQ: XEL) provides the energy that powers millions of homes and businesses across eight Western and Midwestern states. Headquartered in Minneapolis, the company is an industry leader in responsibly reducing carbon emissions and producing and delivering clean energy solutions from a variety of renewable sources at competitive prices. For more information, visit xcelenergy.com or follow us on X and Facebook.
