MINOT, N.D. — Minnesota-based Great River Energy gave North Dakota's economy a firm kick in the teeth recently with its announced decision to close Coal Creek Station.
That's the state's largest coal-fired power plant, employing hundreds of people directly and driving commerce that employs thousands indirectly.
Publicly, Great River Energy officials have been making sorrowful noises about closing the plant, though, behind the scenes, the CEO was exchanging high-fives with cooperative customers over email .
The company has said they're open to finding a buyer for the facility, so it can keep operating, and North Dakota's political leadership seems to think that's possible.
I'll believe it when I see it.
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By way of justifying the decision to close Coal Creek Station -- which, by the way, is one of the most efficient facilities in the nation -- the communications team at Great River has suggested that it was an economic decision.
"We just couldn't overcome those headwinds, even after the great things that the plant operators and employees had done to try to control costs and improve efficiencies," GRE Vice President Mike Fagan told my colleague April Baumgarten for her excellent profile of the situation published over the weekend.
Coal's political enemies have seized on this argument as a way to obscure what years and years hostile policymaking has done to the coal industry. It's the market, they tell us, and not the obscenely burdensome regulations put on coal power and coal mining, or the fact that coal's competitors like wind receive massive subsidies and first-in-line status to deliver their electrons to the grid.
Speaking of subsidies, it turns out the taxpayers will be compensating Great River Energy generously pulling the economic rug out from underneath communities in central North Dakota.
The company's plan is to replace Coal Creek Station's output with some 1,100 MW of new wind power. As Isaac Orr points out in a post for the Center of the American Experience (a right-of-center think tank based in Minnesota), that wind power may be eligible for as much as $1 billion in taxpayer subsidies over the next decade.
That's assuming all of this new wind capacity qualifies for the Production Tax Credit, which was supposed to expire last year but, somehow, magically got reauthorized as a part of a year-end spending bill in 2019 .
Funny how that works, isn't it? The wind industry has been insisting they don't need the PTC subsidies, and yet someone is pulling strings to keep them in place.
Companies that begin a new wind project this year can qualify for the PTC credit for the next decade. That is now scheduled to end at the end of this year, but who knows if it really will.
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The wind industry has an army of very effective lobbyists.
"This taxpayer-funded subsidy pays a wind company $24 for every megawatt-hour (MWh) of electricity that the wind facility generates for the first ten years of it service life, if the facility is built in time to qualify for the full tax credit," Orr writes .
For what GRE is planning, that works out to about $105 million in subsidies per year, for ten years, or just over $1 billion in total.
There are a lot of variables behind that number -- such as how or if the PTC will be renewed not to mention the actual production of these new wind farms -- but suffice it to say that GRE's move toward wind power will be paid for mostly by the taxpayers, at least based on the figures publicly available.
GRE's decision to close Coal Creek Station is harming North Dakota families. It's going to cause schools and businesses to close. It will turn some thriving communities into veritable ghost towns.
And we taxpayers are paying for the privilege.
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Rob Port, founder of SayAnythingBlog.com, is a Forum Communications commentator. Reach him on Twitter at @robport or via email at rport@forumcomm.com .
