Great River Energy reached an agreement to sell the Coal Creek Station power plant to Rainbow Energy Center, LLC. The sale of Coal Creek Station will avert the plant’s closure, which was scheduled for the second half of 2022.
Rainbow Energy Center will purchase and operate the 1,151-megawatt (MW) power plant using current plant employees it hires. The company also plans to develop carbon capture and storage capabilities at Coal Creek Station.
“We are excited for what the future holds for our North Dakota employees and the communities surrounding Coal Creek Station,” said Great River Energy President and Chief Executive Officer David Saggau.
Nexus Line, LLC has agreed to purchase from Great River Energy the high voltage direct current (HVDC) transmission system that connects central North Dakota to the Twin Cities area of Minnesota. Great River Energy will continue to operate and maintain the HVDC system under a 10-year contract with Nexus Line.
Rainbow Energy Center and Nexus Line are affiliates of Rainbow Energy Marketing Corp. of Bismarck, North Dakota.
“The successful implementation of carbon capture and storage is central to our plans at Coal Creek Station,” said Rainbow Energy Marketing Corp. President Stacy L. Tschider. “As a privately held company, we are uniquely positioned to continue the successful legacy that Great River Energy and its employees have established in North Dakota.”
Rainbow Energy Center is developing plans to add new wind generation to the HVDC transmission system that would increase renewable energy deliveries to Minnesota.
Following the sale of Coal Creek Station, Great River Energy will have a power purchase agreement with Rainbow Energy Center. Great River Energy will purchase 1,050 megawatts of power from Rainbow Energy Center for approximately two years, followed by 300 megawatts for approximately eight years.
The power purchase agreement provides a cost-effective and appropriately sized resource for Great River Energy’s member-owners that will serve as a reliable steppingstone as Great River Energy transitions its power supply. Great River Energy estimates the transaction will save member-owners $130 million compared to shutting down the plant.
“We are building a power supply portfolio that will serve our member-owner cooperatives with clean, affordable and reliable energy for decades,” said Saggau. The cooperative will add 900 MW of wind energy by the end of 2023 and remains on track to meet Minnesota’s 80% carbon dioxide reduction goal ahead of schedule.
The sale of Coal Creek Station and the HVDC system is expected to close later this year, after required approvals are obtained.