AREA Frequently Asked Questions

Environmental Retrofits and Emission Reductions  
Project Costs and Customer Impacts
AREA Adjustment Rate Class Impacts

Environmental Retrofits and Emission Reductions

• What is Minnesota Power’s AREA Plan?
  Minnesota Power’s AREA (Arrowhead Regional Emission Abatement) Plan is a voluntary effort to significantly reduce emissions from two Minnesota Power coal-based generating facilities in Northeastern Minnesota in the 2006-2008 timeframe.
   
• Is Minnesota Power’s AREA Plan required (i.e., needed now to comply with new state or federal air quality standards)?
  No. The Minnesota Pollution Control Agency has determined that the AREA Plan encompasses early and voluntary compliance with future expected state and federal air quality standards.
   
• Which two coal-based generating facilities are included?
  Minnesota Power’s AREA Plan includes environmental retrofits at:
  • Laskin Energy Center which consists of two 55 megawatt (MW) (net) coal-fired units located in Hoyt Lakes, Minnesota; and
  • Taconite Harbor Energy Center which consists of three 75 MW (net) coal-fired units located in Schroeder, Minnesota.
     
• What type of emission control measures are currently in place at Laskin and Taconite Harbor Energy Centers?
  Laskin and Taconite Harbor Energy Centers both have tangentially fired boilers burning low sulfur, low mercury sub-bituminous coal. At Laskin, each unit is equipped with a wet particulate scrubber. At Taconite Harbor, each unit is equipped with an electrostatic precipitator.
   
• What emission control technologies are included?
  The AREA Plan includes affordable control technology to reduce emissions of oxides of nitrogen (NOx) at Minnesota Power’s Laskin Energy Center and innovative multi-emission control technology to reduce emissions of NOx, sulfur dioxide (SO2) and mercury at Minnesota Power’s Taconite Harbor Energy Center.
   
• What emission reductions will result from Minnesota Power’s AREA Plan?
   
  It is projected that Minnesota Power’s AREA Plan will deliver the following emission reductions:
  • At Laskin, Minnesota Power expects a 66 percent NOx emission reduction.
  • At Taconite Harbor, Minnesota Power expects a 62 percent NOx emission reduction, a 65 percent SO2 emission reduction and up to a 90 percent mercury emission reduction.
     
• When does Minnesota Power plan to implement the emission control retrofits?
  Minnesota Power plans to implement the AREA Plan in the 2006-2008 timeframe.

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Project Costs and Customer Impacts                     

• How much does it cost to implement Minnesota Power’s AREA Plan?
  Minnesota Power estimates the capital investment under the AREA Plan to be approximately $53.9 million. In addition, Minnesota Power anticipates that after implementation, annual incremental operation and maintenance (O&M) costs to be $4.07 million.
   
• How are Minnesota Power’s AREA Plan costs recovered?
  The costs of Minnesota Power’s AREA Plan are recovered through a separate per-kilowatt-hour charge on your monthly electric bill.
   
• Does Minnesota Power need approval to add the AREA Adjustment onto customers’ monthly electric bills?
  Yes. The Minnesota Public Utilities Commission (MPUC) approved Minnesota Power’s cost recovery of its AREA Plan in an Order issued June 13, 2006 (Docket No. E015/ M-05-1678).
   
• Which customers see the AREA Adjustment on their monthly electric bill?
  The AREA Adjustment is applied to all of Minnesota Power’s retail customers, except those few industrial customers on Minnesota Power’s Competitive Rate Schedules.
   
• When was the AREA Adjustment first applied onto my monthly electric bill?
  Minnesota Power begins recovery of environmental costs as specific AREA Plan components are placed into service.
   
• Will I be notified of the AREA Adjustment?
  Yes. Minnesota Power notified customers through a bill insert prior to the first application of the AREA Adjustment.
   
• How long will the AREA Adjustment continue?
  The AREA Adjustment will be effective after the in-service date of the first AREA Plan component and shall remain in place until all reasonable component costs are incorporated into the final rates established in a general rate case or have been fully recovered.
   
• What is my AREA Adjustment?
  Minnesota Power estimates that the average AREA Adjustment for each rate class is: