East Central Energy’s wholesale power provider, Great River Energy, is selling a coal power plant to Rainbow Energy. Advocates for the sale called it a “move toward a more sustainable future while balancing cost effectiveness” while others called the sale “an environmental and financial fiasco.”

Great River Energy held a system-wide vote on July 30 regarding its sale of Coal Creek Station, its coal fueled power plant in Underwood, North Dakota. The membership voted to approve the sale of the 1,151-megawatt (MW) power plant to Rainbow Energy Center, LLC. Great River Energy President and Chief Executive Officer David Saggau noted in October that the plant lost $170 million in 2019 on energy sales. 

The sale of Coal Creek Station averts the plant’s closure, which was scheduled for the second half of 2022 unless a buyer was found. 

With the approved sale, Rainbow Energy Center will continue to operate the power plant and plans to develop carbon capture and storage at Coal Creek Station to reduce carbon dioxide emissions. GRE will enter into a power purchase agreement with Rainbow Energy Center while also adding 900 MW of wind energy by 2023.

ECE President/CEO Justin Jahnz stated in a press release, “Electric markets are complex. GRE is making a decision that has the most positive outcome possible for a generation asset that was not running economically. At the same time, Coal Creek Station will continue to operate, which preserves the stability of the market as well as the local economy.”

The high voltage direct current (HVDC) transmission system that connects central North Dakota and Minnesota will be purchased by Nexus Line, LLC, though GRE will operate and maintain the HVDC system under a 10-year contract. Additionally, Rainbow Energy Center plans to add incremental generation from renewables to fully utilize the capacity of the HVDC transmission system.

There are additional regulatory approvals required before the sales transactions are finalized.

Jahnz further noted, “ECE members want to know if the sale of Coal Creek Station will impact their electric rates or power reliability. We want to assure our members that this will not adversely affect ECE’s rates. The sale of Coal Creek Station ensures reliable energy for ECE while reducing the risk of an asset that was losing money.”

He adds, “We’re glad to see our power supplier move toward a more sustainable future while balancing cost effectiveness and reliability. The sale of Coal Creek Station is in the best interests of ECE and our nearly 63,000 members.”

Financial Fiasco

Sierra Club and allies raised concerns about the financial harm this decision could have on Minnesota ratepayers. In a press release from the Sierra Club, Margaret Levin, Senior Chapter Director for the North Star Chapter in Minnesota stated, “The vote today sets the stage for an environmental and financial fiasco. 

“The sale subsidizes an unprofitable coal plant with ratepayer and taxpayer money. GRE customers will bear the cost of keeping the dirty coal plant polluting our air and water — while putting taxpayer dollars at risk to experiment with unproven carbon capture and sequestration. There is no reasonable scenario where this ends well for consumers and our shared environment. Instead we should be moving to clean, renewable energy development across the region.”  

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