On May 4, 2023, Xcel Energy proposed to develop a third solar array next to the 460-megawatt Sherco Solar project already under construction near the existing Sherco coal plant site in Becker, Minnesota. Sherco Solar will help meet Xcel Energy customers’ energy needs as the company transitions away from coal.  

In 2022, the Minnesota Public Utilities Commission (PUC) approved the first two solar projects being constructed by National Grid Renewables and construction began in 2023. The three solar projects are expected to be complete by the end of 2025 and will replace the capacity of the Sherco plant’s first coal unit that is scheduled to retire later this year. Xcel Energy will own and operate all three projects. 

Xcel Energy expects to qualify for federal tax credits that make construction more affordable. Solar energy does not have any fuel costs and contributes to a diversified energy mix, which helps protect customers against rising fuel prices. Building the solar projects adjacent to the retiring Sherco coal plant will allow the company to reuse the facility’s existing grid connections, further cutting costs for customers.  

Sherco Solar is among the largest solar developments in the U.S. and is key to Xcel Energy’s plans to nearly triple the amount of solar on its Upper Midwest system by 2028. The combined projects’ 710-megawatt capacity will generate enough electricity to power more than 150,000 homes each year on average.  

The Sherco site plays an important role in the company’s vision to deliver 100% clean energy in Minnesota by 2040, meeting the state’s new benchmark. Xcel Energy’s proposed Minnesota Energy Connection transmission line will link at least 2,000 megawatts of new renewable energy to the grid at Sherco. The company is also partnering on a long-duration battery storage pilot project at the facility. 

Xcel Energy is on track to reduce carbon emissions 85% from customers’ electricity in the Upper Midwest by 2030. The company plans to retire all of its coal units by the end of 2030. 

Commitment to local economy 

The projects will provide economic benefits in Becker and the surrounding area. If approved, the third Sherco Solar array will create an estimated 95 union construction jobs in addition to the 300 construction jobs created by the first two solar projects, plus 18 ongoing operations and maintenance jobs. Sherco Solar will use Xcel Energy’s Power Up workforce and development program, designed to integrate women and people of color who are underrepresented in the utility industry and building trades. 

Xcel Energy is committed to a smooth transition for its employees at the Sherco plant, who have played a vital role in powering the region for decades. The company has transitioned other Minnesota coal plants without layoffs and expects to accomplish this again at the Sherco facility.  

If approved, the third Sherco Solar array will create an estimated $110 million in payments to landowners and local taxes, in addition to the estimated $240 million in local economic benefits from the first two solar projects, over the 35-year life of the projects. The company is also working with the state and local communities to bring new jobs and investments to areas affected by the coal plant retirements.