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Excelsior Energy, Inc., Mesaba Energy Project, Taconite/Hoyt Lakes, Minnesota
Location
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Taconite or Hoyt Lakes, Minn.
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Description
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Excelsior Energy, Inc., is proposing a coal-feedstock Integrated Gasification Combined Cycle power plant and associated infrastructure near Taconite, Minnesota. Construction would be in two phases, each capable of producing approximately 600 megawatts of base load power. Construction is scheduled to begin in 2008-2009; the plant is planned to be in service in 2012.
The preferred site (approximately 1,260 acres) is north of Taconite in Itasca County, Minnesota. The alternative site (approximately 825 acres) is 1 mile north of Hoyt Lakes in St. Louis County, Minnesota. Both sites contain approximately 300 acres of wetlands. Preliminary project plans indicate the potential for significant wetland impacts.
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Background
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The U.S. Department of Energy (DOE) solicited project applications under Round 2 of the Clean Coal Power Initiative, a cost-shared collaboration between DOE and industry to implement the recommendations of the National Energy Policy. Applicants were required to identify a proposed site and alternatives at the earliest stage of the selection process. The Mesaba Project was selected for funding under the initiative in 2004.
In 2003, the Minnesota Legislature adopted legislation that entitled an innovative energy project located in the Taconite Tax Relief Area to be provided several regulatory incentives, including a long-term power purchase agreement, exemption from certificate of need proceedings for initial and future generation and transmission infrastructure, and eminent domain rights for project facilities. Other related 2003 State legislation provided a 12-year State tax exemption and other benefits to the project and its investors.
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The DOE National Energy Technology Laboratory, as the lead Federal agency, has prepared a draft environmental impact statement (EIS) under the National Environmental Policy Act (NEPA). The facility also requires a State-equivalent EIS. The DOE restricted the scope of alternatives reviewed in the EIS to the proposed action and the no-action alternatives. It has indicated that it limited its analysis to the two sites submitted by Excelsior because its decision is purely a fund/no-fund decision pertaining to the applicant’s selected alternative and because
State regulations require the consideration of two sites.
Corps concerns include the limited alternatives analysis in the DEIS and conflicts with NEPA responsibilities and Clean Water Act Section 404(b)(1) requirements.
The DOE released the draft EIS in November 2007. The Corps and EPA submitted comment letters to both Excelsior and the DOE in January 2008 and held several teleconferences with EPA and DOE to discuss concerns with the draft EIS. DOE provided responses to Corps comments in June 2008. St. Paul District Regulatory staff met with Corps and DOE headquarters staffs on July 23, 2008, to discuss NEPA and the limitation of alternatives.
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Status
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DOE, Corps staff, Minnesota Department of Commerce, Excelsior Energy and DOE third party consultants met on August 7, 2008, as a follow up to the headquarters meetings. DOE’s third party consultant, Potomac Hudson Engineering, has asked to meet with Corps staff on September 3, 2008, to discuss some of the remaining technical and procedural issues. Generally, Potomac wishes to discuss with the Corps deficiencies or gaps in the EIS analysis that need to be supplemented and ways in which the presentation of the material can be modified to improve understanding. Procedural items include the overall schedule for the final EIS, including internal DOE review cycles and the mechanics of incorporating Corps feedback into the final EIS.
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