Lyon leaves Melrose improved over 42-year municipal utility career 763.551.1230 Plymouth, MN 55447 3025 Harbor Lane North MMUA by Steve Downer have been hard on his sleep pat- Dale Lyon didn’t learn about tern, at least initially, but he electricity by reading a book learned just about everything or at a computer, though there there was to know about plant was plenty of that along the operation. way—he learned by making and He worked seven years in distributing it, to friends and the plant. He soaked up every- neighbors. thing he could, but his goal was Lyon, the electrical supervi- to get outside on the line crew, sor for Melrose Public Utilities, which he joined in 1982. He was retires Aug. 11. That is 42 years, named line foreman in 1985, as to the day, that he went to work the city distribution system was for the municipal electric and being converted from delta to water utility. wye. It didn’t seem like a long time, As a lineman, it helped to he said. “It went fast.” understand generation and the Lyon was 23 when he an- different feeders that carried swered an ad in the local paper, electricity from the plant. He for a person to work at the Mel- continued to learn as he worked. rose power plant. He was hired. He isn’t shy to admit that the Dale Lyon retires August 11 after 42 years with Melrose Public Utilities. The plant, at the time, was experience he gained led to “a staffed 24 hours a day, seven very good understanding of the days a week. electrical system and how it and is responsible for substa- the Melrose distribution system “We ran a lot,” Lyon said. worked.” tions, lines and generation. is “completely new” from when He worked three different He was named electric super- Driving through the city in shifts, during a week. It might visor at the turn of the century, his pickup, he remarked that Lyon: see page 6 please The RRESOURCEESOURCE Cities, MN Twin at PAID Postage Periodicals Official Publication of the July/August Minnesota Municipal Utilities Association 2017 Volume 24, No. 18 Benson, Hibbing, Virginia compromise with Willmar to decommission Inside Xcel on removal of biomass energy mandate district heating system Stories by Steve Downer The Willmar City Council on June MPUC Looks at Three MMUA members— 19 unanimously approved a resolu- tion to shut down the Willmar Munici- Natural Gas Benson, Hibbing, and Vir- Competition ginia—this past legislative pal Utilities district heating system. page 2 session partnered with Xcel The vote followed a public hearing, at Energy in finding a compro- which nobody spoke. mise that benefited all three The Council vote followed a May 22 communities while saving action by the Willmar Municipal Utili- millions of dollars for rate- ties Commission, which approved a payers in the Xcel Energy resolution to decommission the district service territory. heating system. The Commission deci- In 1994, the Legislature sion followed years of research and de- granted Xcel Energy (then liberation. Northern States Power State law requires a two-year notice Company) expanded stor- The Benson Power plant burned turkey ‘litter’ and wood chips before shutting down a district heating Board, award age capacity for spent to produce electricity. The renewable technology worked, but system. Willmar policymakers decided nominations nuclear fuel at the Prai- also proved to be uneconomic. three years was more acceptable, and now open rie Island nuclear power set July 1, 2020, as the decommission- page 5 plant. As part of the deal- ed a number of stipulations and wood chips to produce ing date. making around that bill, the (funded from the RDF) to power since 2007. The decision to get out of the heating Legislature mandated Xcel ease the coming economic Benson Power paid ap- business was based on economics. purchase 125 megawatts of dislocation. proximately $929,000 in A study requested by the Commis- biomass-produced electric- The legislation provides property taxes to the state, sion in 2014 showed that significant ity, and also established a that an amended or ter- county, school and city in upgrades to the system would be need- Renewable Development minated power purchase 2016, and provides approxi- ed in the near term. Paying for those Fund (RDF). agreement must be present- mately a quarter of the city’s improvements would lead to a doubling Eventually, the biomass ed to the Minnesota Public levy. It was the city’s largest of rates. Even at current rates, heating power was supplied by a Utilities Commission and utility customer, purchas- customers were leaving the system, newly-developed, privately- be agreed to by all parties. ing nearly $200,000 in elec- and saving money by converting to a Our Willetts owned plant in Benson, by The legislation specifically tricity, water and sewer ser- natural gas-fired furnace or boiler. Honored With St. Paul District Energy, exempted the St. Paul Dis- vices annually. District heating customers and the trict Energy plant, which Xcel has agreed to com- public were well-informed of the pend- National Award and by municipal power page 9 plants owned by the Hib- will keep on producing dur- pensate the City of Benson ing shut-down. bing and Virginia municipal ing the remaining six years more than $20 million, pay- At an April 3 Commission-Council utilities. The municipal util- of its agreement. able over four to six years, work session, Utility General Manager ities created the Laurentian The Benson situation is for infrastructure and relat- John Harren reported that in 1990 the Energy Authority (LEA) to unique. Benson is home to ed costs. Xcel will pay prop- utility had 394 district heating custom- supply the biomass power. Benson Power (formerly Fi- erty taxes on the plant for ers, but that number had dwindled to The 2017 Legislature brominn), a privately-owned two years beyond its closing. 218 residential and commercial cus- ended the biomass-pur- company. The plant there tomers. (By the time of the Council chase mandate, and includ- has burned turkey ‘litter’ Biomass: see page 7 please Willmar: see page 4 please MPUC drops complaint over gas service to Vikings; opens look at competition by Steve Downer To get to the bottom of quarters. customer to provide a Contri- kings with a proposal to serve Xcel will serve natural gas that question, the MPUC will In March 2017, Xcel-Gas bution in Aid of Construction the area, that it believed to the new Minnesota Vikings open a generic docket to re- and the Vikings entered into for the necessary facilities to MERC also submitted a pro- corporate headquarters and view and investigate the pa- a Natural Gas Competitive provide service. posal, and that the Vikings practice facility in Eagan, rameters of inter-gas utility Agreement, whereby Xcel In its complaint, MERC selected Xcel as its gas pro- despite a complaint to the competition that involves the would provide natural gas argued the area was located vider. Minnesota Public Utilities duplication of existing facili- service to the entire 200-acre entirely within its natural MPUC staff said it ap- Commission (MPUC) from ties. That docket will also re- development site. In April (though not exclusive) service peared duplicate facilities Minnesota Energy Resources view and investigate the use 2017, the Vikings requested territory, which it has long would result from Xcel ser- Corp. (MERC) of promotional incentives and MERC remove its facilities. served. MERC alleged that vice to the customer. It said The MPUC on June 8 dis- other non-tariffed payments MERC did so. Xcel’s actions were inconsis- MERC’s estimates to serve missed the complaint, but provided by utilities to their MPUC staff said it ap- tent with Minn. Stat. 216B.01 the customer were substan- that isn’t the end of the story. existing customers and poten- peared both utilities were of- and existing Commission pol- tially less than Xcel’s estimat- Was the complaint an tial future customers. fering service in accordance icies. ed construction costs. Xcel’s anomaly with a high-profile The 200 acres in Eagan with their tariffs. However, The statute cited reads, “It proposed facilities would customer, or the tip of a com- purchased by the Vikings was it said Xcel-Gas was offering is hereby declared to be in the cross underneath Interstate petitive iceberg in an rate- formerly owned by Northwest a “stimulus package” consist- public interest . to avoid 494 and involve construction regulated industry with no Airlines. MERC provided gas ing of promotion incentives, unnecessary duplication of along various county high- defined service territories? service to the airline head- potential tax savings and facilities which increase the ways, whereas MERC’s con- conservation rebates. Essen- cost of service to the consum- struction would involve con- tially, said MPUC briefing pa- er and to minimize disputes structing service lines from SOLUTIONS FOR ELECTRIC GENERATION pers, “Xcel-Gas is paying the between public utilities which its pre-existing main. Vikings to take its service.” may result in inconvenice or Staff broached the sub- We’ll deliver reliable, competitively-priced Staff said it was “uncertain diminish efficiency in service ject of requiring Xcel-Gas to natural gas service for all your projects. of the legality of Xcel-Gas’s to the consumers . ” make payment to MERC for incentives” or if the incen- MERC also expressed con- remaining facilities costs and Contact Russ Wagner today. tives are in accordance with cern over safety and stranded revenue losses. It notes this 612-321-5003 the company’s tariff. cost issues.