Clearing air may raise power costs in Minn., ND
BEMIDJI — A federal program to clear the air in natural areas including national parks may mean rate increases for electric customers in northwestern Minnesota and eastern North Dakota.
Customers there already saw double-digit rate increases this year after the Minnkota Power Cooperative raised wholesale rates by millions of dollars to pay for environmental upgrades, mostly to its coal-fired power plant in Center, N.D. The Environmental Protection Agency now seeks another big upgrade, Minnesota Public Radio reported Tuesday ( http://bit.ly/nTbwGq ).
Minnkota spent more than $425 million to meet existing standards set by the U.S. Environmental Protection Agency, and the resulting rate increase affected more than 100,000 customers.
The EPA will soon release a proposed plan to curb nitrogen oxide emissions in North Dakota as part of the federal Regional Haze Program, which aims to improve visibility in natural areas such as national parks. Regional haze regulations are being implemented across the country.
But the state of North Dakota is siding with Minnkota and is threatening to fight in court. Local officials argue that the EPA's proposed technology would cost a half-billion dollars and would not produce noticeably better visibility than cheaper, state-favored technology. Kristi Schlosser Carlson, an attorney for Minnkota, also said early tests show that the EPA's technology won't work with the type of coal burned in Minnkota's plant.
In Blackduck, just north of Bemidji, the Anderson Fabrics plant needs lots of electricity to run its sewing and quilting machines. It's one of the area's largest employers, and company President Steve Cochems said the rate hike of about 30 percent this spring is straining the company's finances,
"It adds to everything else that's going on," he said. "Electric rates are a key expense to a business like this."
Cochems said the hike means scaling back plans for growth.
"That doesn't allow you to invest that money in other places, whether it be employee increases or benefits, or bringing in additional equipment to take on new business, which would be additional employees," he said.
Schlosser Carlson said the cooperative wants cleaner air without additional large rate increases.
"We enjoy the clean air and the clean water here in North Dakota and Minnesota, and of course we see the benefits of protecting that," she said. "At some point, though, the scales tip."
EPA officials, who will make their plan public next week, say it's superior in terms of price and efficiency.
"We have technical experts on the other side of the issue saying that they do believe that this will work," said Carl Daly, an EPA program director in Denver. "We think that our proposal would offer technologies that are cost effective and give a good degree of improvement in visibility."
The public will have 60 days to comment on the EPA's plan, with a final decision due in February.
If the EPA doesn't ease off, a court challenge based on states' rights is likely, said Terry O'Clair, director of air quality for the North Dakota Department of Health.
"If they choose to go that route, we will be entering into court," O'Clair said. "We believe the Clean Air Act provides the states with the flexibility and the authority to control regional haze within our borders."
It would take several years to install the emissions technology no matter which proposal is chosen. The long-term goal of the Regional Haze Program is to return to so-called "natural" visibility conditions by 2064.