September CEO Message

The pace of change in the energy industry has accelerated dramatically.  From groundbreaking local projects to sweeping national policy shifts, the energy landscape we knew even a year ago looks very different today.

Energy Storage

In Olmsted County, the recently approved Snowshoe Energy Storage Project will be Minnesota’s first stand-alone battery energy storage system (BESS).  This 150-megawatt system will store enough energy to power approximately 100,000 homes, helping stabilize the grid and ensure reliable service during peak demand and outages. 

The BESS is not connected to any specific power plant or generator but uses the same mix of energy sources that serve the local grid.  It enables energy to be to be stored when prices are low and dispatched when demand exceeds supply or during outages, enhancing grid resilience.  As energy needs grow, battery storage like Snowshoe will be essential to balancing supply and demand efficiently and affordably.  To learn more details about the project, visit www.snowshoebess.com.

Energy Transmission

At the regional level, the Midcontinent Independent System Operator (MISO) has launched two major transmission initiatives—Tranche 1 and Tranche 2.1—to modernize and expand our regional grid.  Our power provider, Dairyland Power Cooperative, is actively engaged with both initiatives.  Tranche 1 includes 18 projects across the Midwest with a $10.3 billion investment.  A benefit-cost analysis for Dairyland’s project revealed most of the project’s benefits are due to reduced congestion and fuel savings, reduced greenhouse gas emissions, and avoided costs of local generation resources.

Tranche 2.1, approved in late 2024, adds a 3,631-mile 765 kV transmission backbone, representing a $21.8 billion investment in 24 projects and 323 facilities across the Upper Midwest.  To put this into context, a single 765 kV line can carry the same electricity as six 345 kV lines, using less land and reducing energy losses.  This helps avoid replacing aging infrastructure, saving $1.2–$1.8 billion across the region over 20–40 years.

One of the Tranche 2.1 projects is a 139-mile, 765 kV transmission line from Marion Township, east of Rochester, Minnesota, to Bell Center, Wisconsin, that Dairyland refers to as the MariBell project.  It will improve regional power flows therefore reducing congestion and enabling more efficient dispatch of generation.  This can lower Dairyland’s cost to serve its members and improve its financial margins, which in turn benefits you as a member of People’s Energy Cooperative through stabilized electric rates and capital credits. 

Energy Policy

The passage of the One Big Beautiful Bill Act in Congress this summer has dramatically altered incentives that once made large-scale solar projects viable. This, along with new tariffs on imported solar components, has added cost and complexity.  Reduced financial incentives and increased regulatory complexity will require developers to reassess project timelines, supply chains, and financing models to adapt to the new policy environment.

Energy Demand

Driven by the explosive growth of artificial intelligence, data centers are emerging as major energy consumers.  A 2024 report by the Department of Energy estimates that data center load growth has tripled over the past decade and is projected to double or triple by 2028.  These centers require significant amounts of power and are reshaping how utilities plan for future load growth.  While we probably won’t ever serve the likes of Google or Microsoft in our service territory, we currently serve one data center and have seen an uptick in inquiries from smaller data centers looking to locate in our area.

As we navigate the changes in the energy industry, I encourage you to learn more about what it takes to safely deliver reliable and affordable electricity to you, our members.  Please join us at one of our upcoming Energy Forums to learn about MISO and Dairyland’s critical role in your electric service and the grid.  Details about the events are on Page 6.  I hope to see you there!