Minnesota Power, an ALLETE company (NYSE:ALE), sped up plans to build a 105 MW, $157 million wind energy project in North Dakota, citing a competitive turbine market, federal production tax credits and regulatory support as factors for moving up its timeline.
The 35-turbine Bison 3 project will be constructed near the company’s Bison 1 and 2 wind projects. In approving Minnesota Power’s long-term resource plan, the Minnesota Public Utilities Commission in May ordered the company to consider adding more wind to its renewable portfolio, before federal production tax credits expire on Dec. 31, 2012.
The 82 MW Bison 1 is halfway complete with the second phase expected to be online at the end of 2011. Bison 2, a 105 MW wind development, will be constructed concurrently with Bison 3. Both projects are scheduled to be in service in 2012. Bison 2 and 3 will begin construction once necessary permits and approvals are received. The Bison 3 project will use 3.0 MW Siemens turbines like those being used for the second phase of Bison 1 and all of Bison 2.
Energy from all three projects will be delivered to Minnesota Power via a direct current transmission line, which stretches 465 miles from the Square Butte Substation in Center, N.D. to the company’s Arrowhead Substation near Duluth. The addition of Bison 3 will move the company within 5 percent of achieving the state’s mandate that it receive 25 percent of its electricity from renewable resources by 2025.
Over time, the addition of wind energy is expected to lower costs to customers by offsetting power purchases in the wholesale market. Minnesota Power will seek current cost recovery eligibility for Bison 3, which, if approved, will occur under the company’s Renewable Resources Rider.