PSC Approves Siting Permit for Wild Basin Gas Plant

PSC Approves Siting Permit for Wild Basin Gas Plant

The North Dakota Public Service Commission has approved a siting permit for the Wild Basin Gas Plant six miles northeast of Watford City in McKenzie County. 

Oasis Midstream Services LLC operates their current Wild Basin Gas Plant and Crude Handling Facility which is now able to process 80 million standard cubic feet per day of gas and stabilize up to 60,000 barrels of crude oil per day. Oasis sought a permit to increase the capacity of the facility to process 280 million standard cubic feet per day of gas, stabilize up to 80,000 barrels of crude oil per day and add an additional 150,000 barrel crude oil storage tank. The expansion brings the facility above the threshold requiring Public Service Commission siting approval. 

“This gas is a by-product of the oil industry. It will either be wasted by flaring it into the atmosphere or it will be processed into a usable, value-added product,” said Commission Chairman Randy Christmann.  “This processing plant is one of the biggest steps ever taken in North Dakota to decrease flaring and increase revenues for mineral owners, producers and taxing authorities.”

Estimated cost of the entire expansion project is $150 million.

Administrative Rules Committee Completes Review of Rule Changes Related to Wind Projects

Administrative Rules Committee Completes Review of Rule Changes Related to Wind Projects

The Administrative Rules Committee of the ND Legislature has finished their review of two sets of rule packages for future wind projects and ensure they are removed and reclaimed when no longer useful. The rules become effective July 1, 2017.

“A half century ago our ancestors made a commitment to ensure that our coal mines would be reclaimed when the prairie became quiet again,” said Commission Chairman Randy Christmann.  “These new rules demonstrate a renewed commitment by our generation to ensure that North Dakota’s beautiful landscape will be returned to its splendor when these giant wind turbines reach the end of their usefulness.” 

The rule changes were approved by the PSC in early May and sent to the Administrative Rules Committee for final review.  

PSC Coal Regulatory and Abandoned Mine Programs Receive High Marks

PSC Coal Regulatory and Abandoned Mine Programs Receive High Marks

The federal Office of Surface Mining recently released its annual evaluations of the Public Service Commission’s coal regulatory program and the abandoned mine lands program. These evaluations are done annually to assure that the programs are being implemented consistent with the federal Surface Mining Control and Reclamation Act (SMCRA) of 1977.

“The complimentary language in these reviews emphasizes the outstanding work our Abandoned Mine Lands and Reclamation teams do throughout the year,” said Commissioner Randy Christmann who holds the coal mining, reclamation, and abandoned mine lands portfolio. “Their efforts are assuring that North Dakota’s landscape will be safe, productive and beautiful for future generations.”

Regarding the coal regulatory program for current mining operations, the evaluation indicated that “North Dakota has an effective program with no issues in need of corrective action. The Reclamation Division carries out its duties using the appropriate technical expertise and with a high level of professionalism.”

The evaluation of the abandoned mine lands program said, “the state administers an excellent program in full compliance with their approved plan.” They also state that the program “met the goals of abating hazards and improving site conditions at all projects conducted. These projects have reduced the likelihood of death or injury to property owners and the public.”

The PSC’s abandoned mine reclamation program aims to eliminate hazards related to coal mining that was conducted before the enactment of reclamation laws in the 1970’s. The program is funded by a fee that is collected on all active coal mining operations. PSC staff designs and manages projects each year and contacts the work through a competitive bidding process.

Both programs were headed by Jim Deutsch, who retired at the end of November after 42 years with the Public Service Commission. The Commission appreciates his dedicated efforts and achievements that are obvious in these evaluations. Dean Moos, former Assistant Director in the Reclamation Division, has taken over as director as of December 1.

North Dakota Public Grain Storage Capacity Continues to Increase

North Dakota Public Grain Storage Capacity Continues to Increase

Licensed grain storage in North Dakota has increased more than 4.5 percent from approximately 451 million bushels of capacity in 2015 to 471 million bushels currently, according to the North Dakota Public Service Commission. This does not include private, on-farm grain storage which is not tracked by the PSC.

“Even in these times of depressed commodity prices, our grain industry has really stepped up by adding valuable new storage,” said Commissioner Randy Christmann. “As our agriculture producers continue to increase their ability to grow food and fuel for the world, we continue to benefit from additional storage options.”

The Commission licenses 383 grain warehouses and 81 roving grain buyers. North Dakota licensed public grain warehouses average 1,229,500 bushels of storage capacity, more than double the average capacity in 2000. One hundred years ago the state had more than 2,000 licensed elevators, averaging only 30,000 bushels of capacity for a total licensed capacity of approximately 60 million bushels.

Public Service Commission’s Abandoned Mine Lands Project Receives National Award

Public Service Commission’s Abandoned Mine Lands Project Receives National Award

 The federal Office of Surface Mining Reclamation and Enforcement has given its 2016 Small Project Award to the North Dakota Public Service Commission’s Abandoned Mine Lands (AML) Program. The Commission’s AML Program is receiving the award for the exceptional work done at the Halleck Mine approximately five miles north of Bowman.  

The Halleck Mine was an underground mine with a coal seam that was 30-40 feet thick and the top of it was only 10-50 feet below grade. It operated from about 1919 to 1944. Sinkholes have been common in the area and were known to be near roads and a 30-inch diameter high-pressure natural gas pipeline. In 2014 emergency repairs were completed due to several large sinkholes that severed a fiber optic telecommunications cable and were dangerously close to the pipeline. 

This reclamation project involved drilling and grouting to locate and fill underground voids near public roads and near the natural gas pipeline. Extra precautions were taken during the procedure to prevent damaging the pipeline while making certain the voids were filled. 

“Because of the reclamation fee being paid by current mine operations, the PSC is able to repair some of these sites that were abandoned decades ago,” said Commissioner Randy Christmann, who holds the coal mining, reclamation and AML portfolios. “It allows us to protect our infrastructure and our citizens without using taxpayer dollars. This was a particularly challenging project and our team did a great job.” 

The Commission’s AML Program is in place to eliminate dangerous situations that resulted from mining activities which occurred before the 1977 federal reclamation act. The Commission receives funds for the program from a federal reclamation fee that is collected on all mined coal.

Public Service Commission Denies Advance Approval for Xcel Energy Solar Projects

The North Dakota Public Service Commission has denied a request from Xcel Energy for an advance determination of prudence for solar generation projects in Minnesota. 

The decision by the Commission emphasized a conclusion that the power is not cost-effective and would cause increased costs to North Dakota customers without corresponding benefits.  

Xcel Energy had requested the determination from the Commission for 187 MW of solar energy. The projects were proposed to meet mandates passed in 2013 by the State of Minnesota that require the company to serve 1.5 percent of its retail customers with solar energy by the end of 2020 and 10 percent by 2030. 

The advanced determination of prudence would have assured the company in advance they could charge customers for the costs of the solar projects.  

“We need to do all we can to make sure that the state of Minnesota’s scheme to mandate very high-cost electricity is not paid for by North Dakotans who happen to receive service from Minnesota-based utilities,” said Commissioner Randy Christmann.

Commissioner Christmann Receives Distinguished Service Award at Lignite Energy Council’s Annual Meeting

Commissioner Christmann Receives Distinguished Service Award at Lignite Energy Council’s Annual Meeting

Public Service Commissioner Randy Christmann was presented with the Distinguished Service Award for a Regulatory Program at the Lignite Energy Council’s Annual Meeting held in Bismarck last week. The award recognizes Commissioner Christmann’s work to educate North Dakotans about the impact of the proposed Clean Power Plan. 

During remarks given by Jason Bohrer, Lignite Energy Council President, it was noted that Commissioner Christmann attended four public hearings organized by the Department of Health that were held in Williston, Beulah, Bismarck and Fargo. At each meeting, Commissioner Christmann appeared and gave a statement regarding the Clean Power Plan’s devastating impact on the state of North Dakota and the lignite industry. 

“As a member of the PSC, he deals with the public and knows that any rate increase creates hardships on families – especially those on fixed income,” said Bohrer during his remarks. “So it’s our pleasure to recognized Randy Christmann for his voice in letting people across the state know just how devastating the Clean Power Plan would be on electric rates to our state citizens and the lignite industry.” 

“It really is my pleasure to support North Dakota’s lignite industry because what they do not only benefits those people directly involved in the industry, but it also benefits all of us who cherish the dependable and affordable energy they provide,” said Commissioner Christmann.

Public Service Commission Observes National Weights and Measures Week

The North Dakota Public Service Commission is observing National Weights and Measures Week March 1-7 to commemorate John Adams signing the first United States weights and measures law on March 2, 1799. The goal is to educate people about the program which ensures weighing and measuring devices being used for commercial purposes are accurate.

Government weights and measures programs protect both the buyer and the seller from inaccurate devices. Inspectors use extremely accurate equipment to inspect scales, meters, scanning equipment and packaged products at supermarkets, discount and department stores, grain elevators, livestock sales rings and gasoline stations.

“North Dakota is committed to making sure commercial transactions are equitable transactions between business operators and consumers,” said Commissioner Randy Christmann, who holds the Weights and Measures portfolio for the Commission. “This is accomplished cooperatively between state inspectors and licensed private inspectors who work every day to protect consumers in North Dakota.”

North Dakota’s Weights and Measures program also monitors and tests private, commercial testers of measuring devices to assure their accuracy.

Weights and measures programs are in place to protect consumers and assure fair and equitable transactions between customers and businesses. When inspectors discover violations, they take enforcement actions against the operator of the measuring device which may include ordering that it not be used until it is fixed or possible penalties prescribed by law.

PSC Approves More Than $2 Billion in Energy Infrastructure Projects for 2015

The North Dakota Public Service Commission evaluated and approved nearly $2.1 billion worth of siting applications for energy-related infrastructure projects in North Dakota during calendar year 2015. These projects included gas-fired generation stations, two gas processing plant expansions, two electric transmission lines, pipelines totaling nearly 500 miles and two wind farms. 

The siting process requires a very thorough review and evaluation of the project. Once applications were deemed complete hearings were held to gather public input. 

“These are the projects that will make our energy systems safer, more efficient, and less of a burden for the general public,” said Commissioner Randy Christmann.

Randy Christmann: Clean Power Plan Will Cost Americans

In August the Environmental Protection Agency (EPA) released President Obama’s Clean Power Plan. Although this plan has been discussed frequently before and since the actual release, I believe most people have not been told how this plan will impact their personal finances. 

In order to understand this 1,560 page plan, let’s set aside the arguments over whether climate change is caused by human activity, and focus only on the impacts of this specific effort to deal with carbon dioxide (CO2) emissions. To be clear, carbon dioxide is the same substance that we exhale when we breathe. 

The Clean Power Plan requires North Dakota to reduce CO2 emissions by 45 percent by 2030. It is very easy to look at a 45 percent reduction by 2030 as something very distant and abstract.  The first thing North Dakotans should keep in mind is that most of this reduction needs to be achieved by 2022!  This is moving much more quickly than the EPA leads us to believe when they emphasize 2030 as the deadline for the final steps. 

Many people have also been lead to believe that this can be accomplished by replacing coal plants with either natural gas plants or wind farms without sacrificing reliability. Others believe that energy efficiency programs would make a meaningful difference. However, the actual details of the Clean Power Plan itself and the physical realities of energy generation and transmission make these solutions mostly unworkable for North Dakota.

The reality is that much of this 1,560 page plan is a series of distractions meant to make us believe that the impact will be minimal or that the impact will fall on somebody else. When you strip away these unworkable distractions you are really left with a new cap and trade policy very similar to the one that President Obama could not get passed by Congress in 2009. This time he has bypassed Congress and implemented a rule that carries the weight of law. 

Under the provisions of the Clean Power Plan, states are encouraged to implement carbon trading programs.  Essentially, our energy companies can continue to produce CO2 as long as they buy credits from a market. That market has not yet been created.

The Clean Power Plan assumes compliance could cost around $30 per ton. (These are the same people who thought ND would have to lower emissions by 11 percent. It turned out to be 45 percent.) I think that cost will be much higher than $30 per ton, but really nobody knows because, again, this market does not yet exist.

Even if we use the EPA’s suspiciously low number of $30 per ton, it will cost ND energy companies around $375 million per year.  EPA is likely underestimating but that figure of $375 million per year equates to nearly $50 per month for each person in ND!

Don’t be deceived, the energy companies are not actually in a position to pay these costs.  These are costs that will ultimately be passed on to consumers. Whether you use the EPA’s numbers or acknowledge that it will likely cost much more than $50 per month for each person it is undeniable that many of our lowest income residents will be unable to keep up with this additional burden.

At the North Dakota Public Service Commission we deal with electric and gas rates on a regular basis and it is my belief that even small increases of a few percent have a serious impact on low income residents. Larger increases have a chilling effect on economic development. That being said, the much larger increases we will face under the Clean Power Plan will cost jobs and leave many N.D. residents unable to keep up with their electric bills at the same time they are trying to keep up with food, medical, and other essential costs.

Regardless what you believe about climate change and CO2, as a North Dakota resident you should be evaluating whether the President’s plan is a plan you are willing to pay for.  I believe the costs far exceed the benefits, with the costs mostly being paid by Americans in rural areas while any perceived benefits are erased by the fact that China is committed to increasing their CO2 emissions during the next 15 years.

North Dakota has filed a legal challenge to the EPA’s Clean Power Plan and I encourage citizens to support Attorney General Wayne Stenehjem and the other participating agencies in this endeavor.

Randy Christmann

North Dakota Public Service Commission