Biomass Energy and its future in WisconsinBiomass Energy and its future in Wisconsin

David Donovan

Manager, Regulatory Policy

David Donovan

Manager, Regulatory Policy

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“When I look ahead to the future of my industry, I see electric production that will be highly efficient, harness diverse resources, and be nearly emission-free. I believe this future is possible. But we need to support both smart policy and new technology today to make it happen tomorrow.”

Dick KellyXcel Energy President and CEO

November 2006

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Northern States Northern States Power Company- Power Company-

MinnesotaMinnesota

Northern States Northern States Power Company- Power Company-

MinnesotaMinnesota

Public Service Public Service Company of Company of

ColoradoColorado

Public Service Public Service Company of Company of

ColoradoColorado

Southwestern Southwestern Public ServicePublic ServiceSouthwestern Southwestern Public ServicePublic Service

Northern States Northern States Power Company- Power Company-

WisconsinWisconsin

Northern States Northern States Power Company- Power Company-

WisconsinWisconsin

Xcel EnergyElectric Customers 3.3 millionGas Customers 1.8 million

Xcel EnergyElectric Customers 3.3 millionGas Customers 1.8 million

NSP-WisconsinElectric Customers 245,000Gas Customers 104,000

NSP-WisconsinElectric Customers 245,000Gas Customers 104,000

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A Leader in RenewablesA Leader in Renewables

#1 Wind Power Provider in U.S.

#5 Solar Power Provider in U.S.

#1 Renewables Provider in Wisconsin

#1 Wind Power Provider in U.S.

#5 Solar Power Provider in U.S.

#1 Renewables Provider in Wisconsin

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A Leader in RenewablesA Leader in Renewables

14% renewables (2008)

19 hydroelectric plants

2 biomass plants

Large amounts of purchased wind

14% renewables (2008)

19 hydroelectric plants

2 biomass plants

Large amounts of purchased wind

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Bay Front HistoryBay Front History

Constructed in 1916 by Ashland Light & Power and Street Railway Company

Improvements increased to five boilers and six turbines for a capacity of 92 MW

In 1979, first investor-owned, electric utility plant in the nation to burn waste wood

In 1986, began $15 million life extension resulting in current configuration of three boilers and turbines with capacity of 74 MW

Constructed in 1916 by Ashland Light & Power and Street Railway Company

Improvements increased to five boilers and six turbines for a capacity of 92 MW

In 1979, first investor-owned, electric utility plant in the nation to burn waste wood

In 1986, began $15 million life extension resulting in current configuration of three boilers and turbines with capacity of 74 MW

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Bay Front OperationsBay Front Operations

35 full-time employees

Wood purchases of $5.0 million in 2008

$20 million+ local economic impact

Generates an average of 325,000 MWh/year

Helps meet Wisconsin’s RPS

Beneficial use of fly ash to construct “pad sites” to aid local farmers, ranchers, others

35 full-time employees

Wood purchases of $5.0 million in 2008

$20 million+ local economic impact

Generates an average of 325,000 MWh/year

Helps meet Wisconsin’s RPS

Beneficial use of fly ash to construct “pad sites” to aid local farmers, ranchers, others

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Fuels at Bay FrontFuels at Bay Front

Waste wood

Natural gas

Coal

Shredded tires

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Bay Front OperationsBay Front Operations

Installed nitrous oxide (NOx) reduction system to meet Clean Air Interstate Rules

Reissuance of Clean Air Mercury Rule

Installed nitrous oxide (NOx) reduction system to meet Clean Air Interstate Rules

Reissuance of Clean Air Mercury Rule

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Bay Front Gasification ProjectBay Front Gasification Project

Need for long-term plan for Bay Front

Financial and environmental considerations

Convert remaining coal-fired boiler to use biomass gasification technology

Project allows plant to use 100% biomass

Approx. $58 million

Adds 200,00-250,000 tons of biomass per year

Need for long-term plan for Bay Front

Financial and environmental considerations

Convert remaining coal-fired boiler to use biomass gasification technology

Project allows plant to use 100% biomass

Approx. $58 million

Adds 200,00-250,000 tons of biomass per year

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Biomass Gasification ProcessBiomass Gasification Process

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Major Environmental ImprovementsMajor Environmental Improvements

NOx: 60%

SO2: 80%

Particulate Matter: 80%

Avoids 100,000 tons coal per year

Avoids 200,000 tons CO2 emissions per year

Reduction in mercury emissions

NOx: 60%

SO2: 80%

Particulate Matter: 80%

Avoids 100,000 tons coal per year

Avoids 200,000 tons CO2 emissions per year

Reduction in mercury emissions

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Regulatory ProcessRegulatory Process

Feb. 2009 – Filed Application with PSCWCertificate of Authority vs. CPCN

March-April 2009 – MPUC, NDPSC applications

Spring - Summer 2009 – Environmental Assessment

Fall 2009 – Public hearings

Fall or Winter 2009 – PSCW decision

Feb. 2009 – Filed Application with PSCWCertificate of Authority vs. CPCN

March-April 2009 – MPUC, NDPSC applications

Spring - Summer 2009 – Environmental Assessment

Fall 2009 – Public hearings

Fall or Winter 2009 – PSCW decision

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Review ProcessReview Process

Impact on electric rates

Emissions reductions

Construction schedule

Regulatory approval process

Fuel availabilityWNDR sustainable biomass harvest guidelines

Biomass fuel flexibility, energy plantations, grower cooperatives

Impact on electric rates

Emissions reductions

Construction schedule

Regulatory approval process

Fuel availabilityWNDR sustainable biomass harvest guidelines

Biomass fuel flexibility, energy plantations, grower cooperatives

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Customer and Community ImpactsCustomer and Community Impacts

Eco-municipality goals of Chequamegon Bay

Retain fuel costs in Wisconsin

Support local economic development

Achieve carbon management goals

Meet renewable portfolio standards

Support local agricultural industry

Eco-municipality goals of Chequamegon Bay

Retain fuel costs in Wisconsin

Support local economic development

Achieve carbon management goals

Meet renewable portfolio standards

Support local agricultural industry