Minnesota Power will retire two small coal-fired generators at its Boswell Energy Center in Cohasset by the end of 2018, the Duluth-based utility said Wednesday.
Boswell Energy Center is Minnesota Power’s largest thermal generating facility and consists of four generating units. The company will retire Boswell Units 1 and 2, which are each capable of producing 65 megawatts (MW). It will continue to operate units 3 and 4, which are capable of generating nearly 1,000 megawatts for residential, commercial and large industrial users like mines and paper mills.
Company officials informed employees of the decision Wednesday morning. Thirty persons will be affected.
“The decision to retire units 1 and 2 at Boswell, though difficult for our employees and host communities, is consistent with Minnesota Power’s EnergyForward strategy of diversifying its energy mix, reducing its carbon footprint and evolving away from smaller, older coal generators,” ALLETE Chairman, President and CEO Alan Hodnik said in a news release. Minnesota Power is an operating division of ALLETE Inc. (NYSE: ALE).
“Multimillion-dollar investments in emissions reductions and new turbine rotors at Boswell Units 3 and 4 in recent years have made them among the cleanest-operating, most highly efficient electric generators in the nation. These large, state-of-the-art units, along with the company’s investments in renewable energy and access to low cost power markets, will ensure the continued availability of reliable and affordable electricity to meet the needs of all our customers, including those who compete in global markets,” he said.
The company is working to avoid layoffs through attrition and retirements, said Josh Skelton, vice president-Minnesota Power generation operations.
“We recognize this news comes during a difficult time for the West Range, which has experienced job losses, delays and closures related to our natural resource based industry in recent weeks,” Skelton said. They include the Magnetation shutdown and work stoppage at Essar Steel Minnesota. “Our employees have done an excellent job of maintaining and operating Boswell Units 1 and 2 and we thank them for their many years of dedicated service. We will assist them, as well as the Cohasset community, to help mitigate impacts during this transition.”
In its 2015 Integrated Resource Plan submitted to the Minnesota Public Utilities Commission, Minnesota Power had proposed making improvements to units 1 and 2 and keeping them operational through 2024. But following months of analysis of projected customer needs and industry trends, company officials determined that retiring the two small coal units in 2018 was in the economic best interest of its customers. Minnesota Power will be evaluating the need for replacement power as part of its ongoing system planning activities.
Boswell Units 1 and 2 are the last of Minnesota Power’s small coal-fired units to be retired, idled or converted to cleaner-burning natural gas. The company’s systematic fleet transition of small older coal facilities already has resulted in the removal of 335 megawatts of coal-fired capacity from its generation system. At Taconite Harbor Energy Center in Schroeder, one 75MW unit was retired in 2015 and the remaining two 75MW units were economically idled in September, leaving them available to be called back into service if needed to maintain power grid reliability until coal operations cease there in 2020. The 110MW Laskin Energy Center in Hoyt Lakes was converted to natural gas from coal in 2015.
Boswell Unit 3, at 355 megawatts, and Unit 4, at 585 megawatts, are the backbone of Minnesota Power’s system, the company said.. Investments in state-of-the-art technology have improved efficiencies and reduced emissions of mercury by 90 percent, and sulfur dioxide and nitrogen oxides by 80 percent at the two units while helping to preserve reliable and affordable power for customers.
Minnesota Power has achieved a 25 percent renewable energy mix ahead of Minnesota’s renewable energy goal of 25 percent by 2025. Plans call for the utility to reduce carbon emissions on its system by about 20 percent by 2020 and 30 percent by 2025 compared with 2005 levels.
Originally conceived as one 65-megawatt generator in 1956, plans for Boswell quickly turned into two 65-megawatt units as the demand for electricity by natural resource based companies in Minnesota Power’s service territory increased. Boswell 1 and 2 were dedicated in 1960. Plans to further expand the facility to meet the needs of a booming mining industry were announced in 1968, and Unit 3 was dedicated in 1973. The last and largest generator at Boswell, Unit 4, was dedicated in 1980.