Try 1 month for 99¢

Minnesota regulators heard arguments Thursday for a proposed $700 million natural gas plant in Superior but put off a decision on whether to allow Minnesota Power to build the plant with Dairyland Power Cooperative.

The Public Utilities Commission announced Wednesday that it would not rule on the Nemadji Trail Energy Center until it first decides whether to require an environmental review of the project.

Earlier this week Minnesota’s Environmental Quality Board referred to the commission a petition from Honor the Earth seeking an Environmental Assessment Worksheet. Even though the plant would be in Wisconsin, the environmental group argues NTEC would affect the people, land, air, water and climate of Minnesota.

The PUC is scheduled to hear arguments on the need for the review on Oct. 29.

While regulators could not legally approve the plant before ruling on the environmental review, a coalition of clean energy groups said the commission should have rejected Minnesota Power’s proposal Thursday.

Minnesota Power, which would split ownership and output of the plant with the La Crosse-based cooperative, says Nemadji Trail is needed to support intermittent renewable energy sources like wind and solar while replacing nearly 700 megawatts of coal-fired generation capacity.

Clean energy organizations, consumer advocates and large industry groups have pushed back, and consultants for both environmental and industry groups say Minnesota Power exaggerated its needs and that the plant would result in excess capacity.

The costs would be passed on to about 145,000 customers in northeastern Minnesota as well as rural and municipal utilities in Dairyland’s four-state territory.

“This is a risky deal for ratepayers. This is a risky deal for our climate,” said Leigh Currie, an attorney with the Minnesota Center for Environmental Advocacy.

Currie, representing a coalition of environmental groups, told the commission Thursday that risk to the climate alone is reason enough to deny the plant, which is expected to burn fossil fuels for at least 40 years. She said Minnesota Power could achieve its goals with carbon-free alternatives that are actually cheaper.

An administrative law judge in July recommended against authorizing the project, saying it was not in the public’s best interest and that Minnesota Power failed to show the plant is “needed and reasonable.”

Dairyland Power would also require permission from the Wisconsin Public Service Commission.

A subsidiary of the investor-owned ALLETE, Minnesota Power is based in Duluth. Dairyland, with $1.6 billion in generation assets, provides electricity for about 258,000 customers of 41 member cooperatives and municipal utilities in Wisconsin, Minnesota, Iowa and Illinois.