Minnesota Loses $70 Million Xcel Energy Battery Project as DOE Cuts Funding

(KNSI) — The U.S. Department of Energy announced the cancellation of billions of dollars in funding for projects in several states, including Minnesota.

One of the 12 clean energy projects here was a $70 million grant for an experimental long-duration battery system in Becker. Xcel Energy is in the process of shutting down the coal-fired Sherburne County Generating Station and transitioning to solar power with the largest solar project in the Upper Midwest. That includes an iron-air long-duration battery capable of holding up to 1,000 megawatt-hours of capacity—equivalent to the average daily energy use of between 30,000 and 40,000 homes in Minnesota. It could be tapped at times when demand is high, but renewable energy sources like wind and solar are not producing power when the weather is calm or at night. Form Energy’s iron-air systems can hold power in reserve for up to 100 hours while operating at a cost close to that of a conventional plant. The system is aimed at providing reliable electricity, even during severe weather events like winter storms and polar vortexes.

A statement on the department’s website says that after a memo titled “Ensuring Responsibility for Financial Assistance,” it established a new policy for evaluating financial awards. Under the review process, the DOE determined the funding “did not meet the economic, national security, or energy security standards necessary to justify continued investment.”

The DOE says the move will save taxpayers approximately $7.56 billion, adding $3.1 billion in funding was rushed through in the final months of the Biden Administration, as it came during the period between Election Day and Inauguration Day. Critics say it’s meant to punish largely blue states during the federal government shutdown.

Breaking it down by congressional district:

Betty McCollum (D-04): $467,440,043
Ilhan Omar (D-05): $98,172,889
Tom Emmer (R-06): $70,000,000
Michelle Fischbach (R-07): $19,000,000
Pete Stauber (R-08): $60,000,000

Part of the $467 million in McCollum’s district is $460 million for a now-canceled proposal to build transmission lines in seven states. Officials say that cut alone could lead to higher rates on top of already skyrocketing energy costs, which will fall hardest on middle-income families.

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