Some co-ops seek a pass on Minnesota planning rules

Dairyland Power's service area covers parts of Wisconsin, Minnesota, Iowa and Illinois.

A bill advancing through the Minnesota Legislature would exempt two rural electric cooperatives from having to report their plans for maintaining reliable, low-cost power to customers.

“It’s a just a very burdensome regulatory filing,” said State Rep. Rich Murray, a Republican who represents a southeastern Minnesota district served by Dairyland Power Cooperative members.

Murray said Dairyland officials approached him about their problems with Minnesota’s Integrated Resource Plans, long-range planning documents that utilities need to file every couple of years. The plans include the utilities’ forecasts for electricity demand, as well as an detailed explanation of how it plans to provide that power in a reliable, cost-effective way.

Basin Electric Power Cooperative would also be exempt if the legislation passes.

The bill doesn’t specifically name either cooperative. Instead it says generation and transmission co-ops whose distribution customers are at least 80 percent outside of Minnesota and whose retail electricity sales represent less than 5 percent of Minnesota’s annual total would no longer be required to file resource plans.

State Sen. Dan Sparks, a Democrat from Austin, Minn., is co-sponsoring parallel legislation.

The Minnesota Department of Commerce, which receives the reports, declined to make an official available for comment Wednesday afternoon, but a spokesman issued a statement saying the plans are an important tool:

“The Minnesota Department of Commerce has been working closely with Basin and Dairyland on an ongoing basis to address their concerns with Integrated Resource Plan (IRP) reports. We will continue those efforts, but have significant concerns about HF2747, which would exempt Basin and Dairyland from IRP reporting requirements,” the statement says.

“If approved, this exemption could impact electric reliability in our state and have a broad potential impact on all Minnesota ratepayers. IRP reports provide Minnesota regulators with key information needed to ensure that all utilities serving Minnesota have adequate generating resources to meet their customers’ needs.”

Murray said he would like the Commerce Department’s Energy Resources division to work with Dairyland to come up with a “more reasonable” reporting requirement. He disagrees that the state or ratepayers will be put at a disadvantage without the plan.

“The amount of electricity that the two coops here bring into the state of Minnesota is within the margin of error on these reports,” Murray said.

Dairyland serves two dozen electricity distributors in four states, with its largest customer base being in Wisconsin. Other states include Iowa and Illinois. Less than a fifth of its distribution is in Minnesota, but 85 percent of the time its planning department spends on regulatory reports is spent on Minnesota’s resource plan, according to Kenric Scheevel, Dairyland’s senior governmental relations representative.

The cooperative has been filing resource plans with Minnesota regulators since 1995, but Scheevel said they became more burdensome around 2005 when the state started requesting the raw data that went into its forecasts so that the department could attempt to replicate its results.

“We just don’t understand why Minnesota wants to go that route,” Scheevel said. Other states it does business in require the demand forecasts, but not all of the data that goes into making them. In Minnesota, “it appears there is so much emphasis being put on verifying the methodology.”

Compiling that information requires collecting and organizing data from all of its member cooperatives, he said.

A review of the public utilities commission docket for Dairyland’s most recent resource plan suggests a history of late, incomplete and messy reporting by the cooperative, as well as a hint of strained patience from regulatory staff.

A November 2011 briefing document describes how on September 8, 2011, one week after its deadline for filing an integrated resource plan, Dairyland submitted several separate documents that included nontechnical summaries and numerous spreadsheets.

Commerce Department reviewers noted that they were unable to locate the results of Dairyland’s supply and demand scenario modeling. They also flagged a number of “deficiencies” in the cooperative’s spreadsheets.

Also missing: page numbers. For the second time in a row. The Minnesota Public Utilities Commission issued an order during the co-op’s 2008 resource planning process asking it to refile that report with page numbers.

“Not having page numbers on portions of its filed documents makes it very difficult for commenters to refer the Commission to specific portions of the plan, and in addition makes it difficult for the Commission to refer to portions of the plan when issuing a decision on the plan,” the document states.

Murray’s bill passed a committee hearing Wednesday. Now it’ll be up to the full Legislature to decide whether to give the co-ops a pass.

One thought on “Some co-ops seek a pass on Minnesota planning rules

  1. Many times bills have been written without notice of who would benefit from them but people sure are surprised when they find out that the companies are “just following the law”. Just another way to put more money in their pockets.