March 27, 2017

Otter Tail Power Company advances plans to add electricity generation from natural gas in South Dakota and wind in North Dakota

 

Otter Tail Power Company today announces plans to seek regulatory approvals to build a new gas-fired electricity-generating station in Deuel County, South Dakota, as part of its commitment to low-cost, reliable, and increasingly clean energy. Northwest of Astoria, at the intersection of the Northern Border Pipeline and the Big Stone South-to-Brookings County 345-kilovolt electric transmission line, Astoria Station is positioned to minimize landowner impact and avoid significant costs for extending these existing facilities.

“Astoria Station is part of our company’s plan to reliably, economically, and environmentally responsibly meet our customers’ energy needs, replace expiring capacity purchase agreements, and prepare for the 2021 retirement of the 1950s-era 140-megawatt (MW) coal-fired Hoot Lake Plant in Fergus Falls, Minnesota. We ensure that the mix of resources we use to generate electricity includes enough capacity to reliably serve customers during periods of high demand for power and enough affordable energy to serve customers always.” -- Otter Tail Power Company President Tim Rogelstad.

Astoria Station will be a state-of-the-art, highly efficient simple-cycle natural gas combustion turbine with the capacity to provide approximately 250 MW of energy during periods of high energy use. According to Rogelstad, Astoria Station will complement the company’s wind generation by providing a reliable backstop when the wind isn’t blowing and will have flexible operating options and low CO2 emissions. Some of the natural gas on the Northern Border Pipeline is sourced from the Williston Basin in North Dakota and from Beulah, North Dakota-based Dakota Gasification Company. The company will invest approximately $165 million in the project, which includes approximately 70 construction jobs during the peak of the 13-month construction period. The company expects Astoria Station to be on line in 2021 with three to five full-time employees.

Plans for new wind in Merricourt, North Dakota
In November 2016 Otter Tail Power Company announced plans for a 150-MW wind farm near the small town of Merricourt, North Dakota, in McIntosh and Dickey Counties. Expected to be complete in 2019, the company estimates the project to cost more than $250 million, generate enough energy to power more than 65,000 homes, and add 10 permanent jobs to bolster local economy.

“Today wind energy supplies approximately 19 percent of the electricity we use to serve our customers,” said Rogelstad. “With this addition, customers will receive approximately 28 percent of their energy from wind, which is a low-cost resource. Astoria Station paired with the Merricourt project is a great example of our commitment to providing an optimal mix of energy resources,” said Rogelstad. The company is projecting more than 30 percent of its energy to come from renewables by 2021 as part of an all-of-the-above energy strategy that includes North Dakota lignite coal, Powder River Basin coal, natural gas, hydro, wind, and solar resources.

One mix of resources serves three-state service area
Otter Tail Power Company’s resource plan identifies the most affordable and reliable combination of energy resources for meeting its customers’ needs during the next 15 years. “In developing our resource plan, we engage interested parties from each of the three states we serve,” said Rogelstad. “We have some of the lowest electric rates in the region, even as we maintain excellent customer satisfaction and transition to a cleaner mix of energy resources. It’s important to us that we continue to be an electric utility that does the right thing. Balancing competing environmental, economic, and community concerns can be difficult, but we’ve been successful at finding a balanced approach to serving multi-state customers who benefit from system-wide planning. We credit that, in part, to collaboration among interested parties in our resource planning process.”

Before Astoria Station or Merricourt project construction can begin, generator interconnection agreements must be negotiated with the Midcontinent Independent System Operator and numerous regulatory approvals must be obtained. Visit otpco.com to learn more as each project progresses.