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A day at the North Dakota Public Service Commission

Lein at deskWhen Jerry Lein makes a plan for his work day, the one thing he can always count on is his day not turning out the way he planned. That’s because life at the North Dakota Public Service Commission (PSC) is never dull. And that’s the way Lein likes it.

Lein is a public utility analyst for the PSC, and his expertise lies in electric transmission and permitting new facilities. One particular sector that’s keeping his schedule so lively is the permitting of new wind farms. North Dakota ranks 10th in the nation for installed wind capacity and 6th for available wind resources. Since the early 2000s, utilities and developers have eyed the windy state as a perfect spot to put up turbines to use this abundant natural resource to generate electricity.

Currently, North Dakota has more than 1,400 megawatts of electricity online from wind generation. Lein said that the PSC has either received “Letters of Intent” or has issued permits for an additional 6,000 megawatts (MW) of wind generation, but there’s a significant portion of that 6,000 MW that likely won’t move ahead due to lack of transmission and a poor economy.

The rub lies in where the wind blows. North Dakota can produce a lot of electricity from wind, but the state doesn’t have the population base to use it. Though Lein said transmission is finally starting to catch up somewhat to move the wind energy out of the state, the poor economy outside of North Dakota gives wind developers a challenge in finding markets as belts tighten and consumers demand less energy.

“With the economy in the shape that it is, and everybody having already purchased quite a bit of wind around here, we’re probably at a plateau for right now,” Lein said. “And there’s the production tax credit, too.”

Lein is referring to a federal initiative that gives a 2.2¢/kilowatt-hour income tax credit for utilities to use the first 10 years of large-scale wind electricity production. Often referred to as “PTCs,” production tax credits are an incentive for developers to build wind farms and make them more competitive against rates from tried-and-true technology, such as coal-based power plants. The federal PTCs are set to expire at the end of this year, with no clear indication of being extended at this time.

Wind turbinesThat leaves some scrambling to find a market for their wind power before the end of the year. But one company, Minnesota Power, is in good shape to complete its Bison Wind Energy Center, located near Center, N.D., before 2012 runs out. Minnesota Power, owned by Duluth, Minn.-based ALLETE, had its first phase of the Bison Wind project online the beginning of this year. Phases two and three will bring the total to 292 MW of power making its way along ALLETE’s 425-mile direct current transmission line from Center to Duluth.

The process of getting a wind facility up and running includes many steps, but Lein’s job at the North Dakota PSC is to make a smooth and clear process for those applying.

  1. Letter of intent: “Whoever wants to build a project is required to file a letter of intent a year before filing an application, but the commission can shorten that and does so pretty commonly,” Lein said. “The letter of intent basically gives a description of the project, where it is located, construction schedules and what it costs.”
  2. Application: “The utility puts together an application, which includes an environmental study and review,” Lein said. “They usually will have a consultant to help them put the application together.”
    The PSC has guidelines that the applicant has to follow, including exclusion areas (can’t put a tower here) and avoidance area (can’t put a tower here unless no other reasonable alternative). This is also the time where other state agencies get notice of the projects, like the Health Department, Historical Society, and Game and Fish.
    “We expect the applicant to work through the letters of responses [from the agencies], so that by the time it goes to hearing, all the problems have been resolved,” Lein said.
  3. Review of application:  After an application is filed, the PSC staff reviews the application and deems whether it’s complete or not. The review process depends on staff workload, “A small project can take a couple of hours, a big project, a couple of days,” Lein said. “And it can be drawn out for longer if an application needs further work.” Once it’s deemed complete, the Commission has 3 or 6 months to act on it, depending on the type of application.
  4. Hearing: Once the application is deemed complete, the Commission issues a notice of a hearing. “We go to at least one of the counties where the project is going to be built, and the applicant presents its project and its application, takes any questions that come from the commission and staff, and then the public has a chance to be heard – and that’s the primary reason for going out to the counties.”
  5. Draft order: The Commission staff drafts what’s called a “decision document” that has terms and conditions for granting the permit. “The Commission will often have a working session where we sit down and discuss the case, whatever the issues are, whatever is pending in the case,” Lein said. “The commission then gives direction to the staff and votes on the resulting draft order at a future public Commission meeting.”
  6. Preconstruction conference: Once the permit is issued, there’s a preconstruction conference between staff, the applicant and the construction supervisor.  They go over all the terms and conditions of the order. “It’s a list of things like suspending construction when it’s raining; they need to stop construction if they find an archeological site; they have to fix fences and drain tiles,” Lein said.
  7. Construction notice: The applicant files a notice with the Commission when they start construction and gives weekly updates on progress. “We retain a third party to inspect the job sites and make sure things that the Commission ordered are being followed.” Lein said. “And [the inspector] will do a post-construction inspection and make sure the area is reclaimed.”

There are a lot of steps in the process, but Lein said that from the time an application is filed to the time the PSC has a decision issued, it’s usually around 3 to 6 months.

“It doesn’t always happen that neatly, but that’s the average,” Lein said. “We’ve had a lot of activity lately, and it’s tougher to get things scheduled.”

At this stage in the game, Lein knows how to juggle multiple projects. He’s been at the North Dakota PSC more than 20 years, and spent three years as a policy advisor at the Nevada Public Service Commission.

And he hasn’t tired yet of his days never ending up the way he’s planned.

“There’s always something new coming up in totally different areas,” he said. “You never learn it all, and that’s what makes this job so interesting.”

You may be interested in:
North Dakota Public Service Commission website

North Dakota PSC Siting Applications (includes case numbers) – select “Siting applications as of DATE”

ALLETE’s Minnesota Power webpage (Bison Wind Project info at bottom of page)

Spotlight on North Dakota Energy – Wind Generation

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