Fighting For Rural Economy A Constant Battle
Fighting For Rural Economy A Constant Battle
by Reed Anfinson
Publisher, Swift County Monitor-News
Sometimes you need a little luck. When you get it you had better be prepared to make the most of it through hard work.
It was a stroke of luck that the City of Benson found out in a roundabout way late last week that a bill was moving through the Minnesota Legislature that potentially could have led to the closing of the Benson Power, LLC, plant.
Its closing would be a substantial economic blow to the community. We would lose 45 direct jobs at the plant. Another 50 to 60 jobs would be lost in support of the plant. We would no longer have the people coming and going from the Benson area who are affiliated with the plant in one way or another, staying at the local motels, eating at our restaurants, buying gas, and spending money in other ways.
At the time the power plant was built back in 2005, it was estimated by the Minnesota Department of Employment and Economic Development that it would provide an $8 to $10 million economic boost to the area.
The proposed bill would have ended the state’s biomass mandate. That would have allowed Xcel Energy to then renegotiate the rate it pays Benson Power for the electricity it produces. If Benson Power wasn’t interested in lowering its rates, Xcel Energy could have offered to buy out the remaining 11 years in its power purchase agreement.
The East Coast investors who own Benson Power might have seriously considered such a buyout. It would have taken them off the hook for operating the plant and given them a significant cash influx that could have perhaps been, in their minds, more wisely invested elsewhere.
If they would have accepted the buyout, Excel Energy most likely would have shut down the Benson Power plant.
Those pushing the bill through the Legislature had no reason to notify the City of Benson or its citizens about what was happening. Benson Power had no responsibility to notify the city, either. In fact, having the option of continuing to operate or sell out was a benefit to the investors.
Neither Xcel Energy nor Benson Power’s owners have the community’s financial future as a concern. It’s about profits.
Fortunately, city leaders reacted quickly to the threat marshaling the support of our state Rep. Tim Miller, District 17A-Prinsburg, and Sen. Andrew Lang, District 17-Olivia. Both are Republicans, which considering Republicans control both the Minnesota House and Senate, was helpful to our cause.
Benson City Manager Rob Wolfington traveled to the Capitol in St. Paul to testify against the bill Monday. The city enlisted the help of St. Paul lobbying firm Flaherty & Hood, P.A., to assist with the legislative effort to stop the bill and monitor its status. Minnesota Commissioner of Agriculture Dave Frederickson was also contacted. Frederickson is our former state senator who grew up and farmed in the Murdock area.
The city’s efforts paid off Monday as the bill in its current form was apparently stopped. We are not out of danger yet. A couple versions of the bill still sit in the House and Senate that could be amended and brought back before the session ends in mid-May.
In the past, Minnesota’s Legislature encouraged the production of biomass energy and backed that encouragement with a mandate. The Legislature and former Republican Gov. Tim Pawlenty praised the Fibrominn project. At the 2005 groundbreaking ceremony of the power plant Pawlenty said, “It is an honor to be here on this exciting day for Benson and all of Minnesota with respect to our renewable energy future.” To undo that mandate now would be a betrayal of that encouragement, local investment and state support.
Rural Minnesota already faces extremely tough challenges due to a declining population and aging population. Benson Power represents a relatively new company that provides good jobs that support area families. Those families have homes in the community and children in our schools. They buy goods at local grocery stores, shop at our businesses, attend our churches, and support their community in many other ways.
Back in the late 1990s Litchfield area turkey farmer Greg Langmo was looking for a way help himself and fellow turkey producers deal with a pressing problem.
Minnesota is America’s largest turkey producer with Meeker and Kandiyohi among the state’s biggest turkey growing counties. All those turkeys mean there is an awful lot of turkey litter being produced. It makes a wonderful natural fertilizer for area fields. However, it can’t be spread on the same fields year after year and the amount of litter being produced was exceeding the land available to spread it on.
As pollution rules enforced by the Minnesota Pollution Control Agency and the Minnesota Department of Agriculture became stricter, turkey farmers were looking for an alternative to spreading it on the land and stockpiling it.
It was Langmo who read about an English firm called Fibrowatt that was burning poultry litter to produce electricity. He contacted the company, its owners came to Minnesota, liked what they saw, and agreed to build a biomass power plant here.
We talked to Langmo this past Saturday asking him if the need still remains to have an alternative to spreading turkey litter on the land. “Absolutely!” he said. Langmo was also in St. Paul Monday speaking against the Xcel Energy bill.
The abundance of cheap natural gas has made the use of biomass fuels less cost effective than it was back when Fibrowatt built its Fibrominn plant in Benson. It is projected that natural gas prices will continue to remain low for a considerable time into the future.
Though it appears we have blocked the current effort to shut down the Benson Power biomass plant, in the long-term interests of the city’s economic health we need to be looking at ways it could be modernized or modified. The power purchase agreement that Xcel Energy has with the plant lasts just over another decade. If natural gas remains a low cost fuel and if Benson Power’s energy remains at a high cost, it is unlikely it will keep purchasing the power.
We don’t want to wait until we are faced with the imminent closing of the plant to start working to find solutions.