Energy Economics: Harnessing the Resources Around Us

by Kathleen Preece

“Carbon, carbon everywhere,
On my nose and in the air!”

With reference and due respect to Samuel Coleridge’s epic Rime of the Ancient Mariner in which the verse “Water, water everywhere” appears, another component of our environment, carbon, is becoming a universal chant everywhere –from global concerns to the carbon footprints we make in our own back yards.

Carbon, in the form of carbon dioxide, or CO2, is one of those infamous “greenhouse gases,” joining the lineup with methane, nitrous oxide, and hydro fluorocarbons – all gases emitted by the burning of fossil fuels, especially for power, cement, steel, textile, fertilizer and other industries. All of these gases increase the atmosphere’s ability to trap infrared energy, thus potentially affecting climate – in a negative way.

Minnesota Power is concerned – on a statewide level and beyond. MP is a coal-based utility providing electricity in a 26,000 square-mile electric service territory in Minnesota, supplying retail electric service to nearly 150,000 customers and wholesale electric service to 16 municipalities, as well as to some of the largest industrial customers in the United States.

While it produces and buys power generated from a variety of sources including gas, biomass, and wind – it has, and continues to generate power from the burning of coal, thus making the company a significant carbon emitter. Although there are no legislative mandates for the reduction of carbon emissions, MP’s vice president of Regulatory and Legislative Affairs, Margaret Hodnik, stresses that people care and, obviously, “Minnesota Power cares.”

“If society waits until there are mandates, the time needed to develop solutions and alternatives may not be available.”

Solutions and alternatives are paramount at MP. Dwight Anderson, who manages project development at the company, explains that most of MP’s power load is from taconite and paper industries which, in order to survive and to succeed, have to compete on a global market. The equation to working on finding a solution to reduction of greenhouse gases must factor in significant criteria: low cost options.

According to Anderson, MP is pursuing two avenues to reduce its carbon footprint on the environment.

The first path is “renewables” in the form of “water, wind, and wood,” Anderson explains. The company’s Fond du Lac Dam, contained within the borders of the Jay Cooke State Park near Cloquet, generates 12 megawatts of power using hydro energy. There are discussions about adding more generators and increasing the power output to 22 megawatts.

Anderson describes wind as a ‘premium resource;” its Taconite Ridge Wind Energy Center is the first commercial wind center in northeastern Minnesota. The center is capable of producing about three percent of MP’s renewable portfolio. (State legislation passed in 2006 requires Minnesota electric utilities to generate 25 percent renewable energy by 2025). The 25-megawatt facility produces enough wind energy to power about 8,000 homes annually; it is located on property owned by United States Steel Corporation in Mountain Iron. In January 2007, MP announced plans to expand its use of wind generated electricity in North Dakota and currently has two projects there, totally 100 megawatts energy.

The wood component of this equation is a bit different than wind and water,” Anderson explains. It has a fuel price. MP operates two biomass-fueled facilities: Rapids Energy Center at Grand Rapids, (providing all the steam, most of the air and up to a third of the electrical requirements of UPM-Kymenne paper mill) and Hibbard Energy Center in Duluth (providing steam to the NewPage Paper Mill and to Minnesota Power when needed for generation). Together, they have a capacity of more than 70 megawatts annually. MP’s units’ biomass fuel is mostly wood. The company is exploring ways to increase the use of available wood waste, utilizing drying or compaction technologies. The two biomass units mainly consume production waste from adjacent paper mills and wood they purchase.

Anderson admits he hopes to “call in a fourth ‘W,’ that of wavelength in the form of solar power.” Currently, solar would require twice the capital costs and produce only ½ the output of wind energy.

The second avenue to reducing MP’s carbon footprint on the environment is carbon capture (capturing CO2 from large point sources; it also means scrubbing CO2 from ambient air as a geoengineering technique. The carbon dioxide can then be permanently stored away from the atmosphere) and sequestration (the storage of carbon dioxide, usually captured from the atmosphere, through biological, chemical or physical processes).

These technologies are a ways off, Anderson admits. MPs Director of Federal Affairs Wlliam Libro adds that the company’s strategic analysis and planning must all be done against the backdrop of what impact those activities and their outcomes will have on MP’s customers.

“Minnesota Power will not engage in producing energy from another coal plant until climate change has been taken care of; until a solution is found,” Libro states. The company is diversifying its energy mix, adding alternatives, and engaging and cooperating in research.

“We are keeping lots of options on the table, in case one falls off,” Libro concludes.

A discussion of carbon is remiss is not complete unless it references the forests in the back yard of the Northern Community Internet readership area.

The Rajala Companies know about those back yards. Four generations of Rajalas have been planting, nurturing, and harvesting pines and hardwoods in northern Minnesota. Rajala Companies own and care for 35,000 acres of timberland. In 1996 alone, the companies planted more than 250,000 trees. The companies see forests and forest plantings are part of the solution of carbon emissions since forests offer the highest per acre rate of carbon capture and storage.

Coincidentally, Rajala Companies President Jack Rajala sits at the board table of MP. Complementing the business suit he wears at that table are the boots on his feet – woods boots. Jack and son John, who serves as vice president of Rajala Companies, are adamant that forests offer tremendous opportunity to avoid climate change because of how trees impact the carbon cycle.

It is a fact that forests store carbon for relatively long periods of time in the trunks, limbs, and roots, as well as in the organic component of forest soils and in the decaying plant matter of those forest floors. If forests are grown to be productive and healthy, and the land is not converted to non-forest use, carbon is ‘captured’ from the atmosphere through the resulting growth of the forest.

There is another factor that can make forests even better at affecting carbon, John explains. If the resulting products that are manufactured from harvested forests store their carbon for a long period of time, there is a significant and permanent reduction of carbon in the atmosphere.

There are numerous paths to affecting carbon emission and sequestration in the 21st century, each bearing a footprint that differs in shape and imprint from the one next to it.. Individual footprints are no less significant. Count the cars you drive; the trees you plant.

Imagine the impact if all people and all companies took caution, paying heed to the carbon footprint they produce. We would all, as the Ancient Mariner did, rise as wiser persons "on the morrow morn."

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