Power plants emitting smoke

Xcel Energy to End Coal Use in the Upper Midwest

Integrated plan calls for more than 80% reduction in carbon emissions with more renewables, carbon-free nuclear energy and cleaner natural gas.

Xcel Energy recently announced plans to retire its last two coal plants in the Upper Midwest a decade earlier than scheduled. These plans are part of the proposed Upper Midwest Energy Plan, which the company will submit for approval to the Minnesota Public Utilities Commission (PUC) in July. If approved, the plan will lead to a more than 80% reduction in carbon emissions in the region by 2030, compared with 2005 — a key stepping stone toward the company achieving its vision to provide customers 100% carbon-free electricity by 2050.

The acceleration of the coal closures is another milestone in the company’s clean energy transition that includes expanding wind and solar, using cleaner natural gas and operating its carbon-free Monticello nuclear plant until at least 2040. The plan outlines a path to make the transition while ensuring reliability and keeping costs low for customers.

Key milestones in the company’s industry-leading clean energy transition include:

  • 2022 – Completion of the company’s largest-ever wind expansion, adding 1,850 MW of wind. At that point, more than 30% of customers’ energy in the Upper Midwest will come from wind.
  • 2030 – More than 50% of the company’s customers’ energy in the region will be from renewables, as the transition continues with:
    • Closure in 2030 of Xcel Energy’s final coal plant in the region — the Sherco 3 plant — following the closure of the Allen S. King coal plant in 2028.
    • A major expansion of solar energy, with more than 3000 MW of new universal solar added by 2030.

“This is a significant step forward as we are on track to reduce carbon emissions by more than 80% within 2030 and transform the way we deliver energy to our customers,” said Chris Clark, president, Xcel Energy – Minnesota, North Dakota, South Dakota. "Accelerating the closure of our coal plants and leading this clean energy transition would not be possible without the dedication and support of our key stakeholders. We thank them for their work to put us on a path to deliver 100% carbon-free electricity by 2050."

While the company prepared its long-term plan, it also worked closely with a coalition of groups, including environmental and labor organizations on an agreement to close its two remaining coal plants in the region. Additional elements of the agreement include increased commitment to solar energy, energy efficiency, consideration of local job impacts in connection with future renewable additions, and purchasing a natural gas plant, the Mankato Energy Center.

“Clean energy and economic vitality are critically important to our communities and we appreciate the leadership and collaboration from this coalition of groups in reaching this agreement,” said Clark. “We look forward to continued partnership as this agreement is reviewed by the Minnesota PUC.”

Commitment to Communities, Customers and Employees

Xcel Energy’s proposed plans come with a commitment to helping its employees, and the communities that host its plants, make a successful transition to cleaner energy. The company expects to manage the transition through attrition, retirements and retraining for employees who take other jobs within the company. It will also work closely with the Monticello community as it seeks to continue the use of the Monticello nuclear plant until at least 2040. That process requires approvals at state and federal levels.

“Our employees are the reason we are able to deliver reliable service to our customers,” said Clark. “Over the next decade, we will work closely with them and our plant-host communities to ensure a successful transition. We have been on our clean energy journey for more than a decade and have a track record of making the transition with a strong focus on our employees and communities.”

The company’s plan is also designed to ensure that customers’ bills stay low. As Xcel Energy moves forward on its clean energy vision, it believes it can reach its carbon-reduction goals outlined in the plan while keeping customer bills at or below the rate of inflation. Retiring coal, adding renewables, and extending the use of nuclear energy is the fastest way to deliver carbon reductions at the lowest cost.

Xcel Energy has worked collaboratively with stakeholders including business, community, and environmental groups to shape its Upper Midwest Energy Plan over the past 18 months. The plan will be formally submitted for consideration with the Minnesota PUC on July 1, 2019.

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