Otter Tail Power Company approved to pursue replacement energy plans amid shift away from coal-based energy

The Minnesota Public Utilities Commission (MPUC) last week approved an integrated resource plan from Otter Tail Power that will change its relationship with the coal-powered Coyote Station and open the doors to new replacement energy project plans.

While Otter Tail and other parties filed a settlement agreement in April, MPUC’s approval greenlights many elements of the plan contained within the company’s 2022-2036 integrated resource plan docket.

“We appreciate the working relationships we have with the Minnesota Department of Commerce Division of Energy Resources, International Union of Operating Engineers Local 49 and North Central States Regional Council of Carpenters, and Laborers’ International Union of North America Minnesota and North Dakota (LIUNA) who supported our settlement going into the final hearing,” Tim Rogelstad, Otter Tail Power Company president, said. “And we gratefully acknowledge the MPUC’s ability to manage extremely challenging dockets and continue to demonstrate its commitment to best addressing the needs of our customers.”

The decision weighed in on three main points. First, it authorized Otter Tail to retain reliability benefits from the North Dakota coal plant known as Coyote Station, while running the portion of the plant needed to serve Minnesota customers in emergency situations as of June 1, 2026. By 2031, Otter Tail will be cut off from using Coyote Station’s capacity or energy for Minnesota customers entirely, though the order does not force it to divest from the station entirely. The company will still use the facility for its North Dakota and South Dakota customers.

At the same time, Otter Tail can now begin crafting project plans to replace the energy from the portion of Coyote Station used to serve Minnesota. Broken down, that will include about 200-30 MW of solar resources, 150-200 MW of wind resources and 20-75 MW of battery storage, and all will need to be operational by the end of 2029. In this way, the company will more closely align with the Minnesota Carbon Free standard.

Finally, the regulatory process for plans to add on-site liquefied natural gas storage at Otter Tail’s Astoria Station natural gas facility advanced a step. This site offers a shared resource for the company’s three-state service area, and it has emphasized to MPUC its capabilities for reliability and energy price protection.

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