Iron Range Energy Project Gains Ground, Still Needs Customer

By KBJR News 1

August 15, 2012 Updated Aug 15, 2012 at 8:06 PM CDT

Coleraine, MN (Northland's NewsCenter) - A proposed energy project on the Iron Range could be closer to becoming operational than ever before.

Excelsior Energy's Mesaba Energy Project received word from the Public Utilities Commission Tuesday that all its permits for a natural gas plant are valid through 2019. Officials from the company say that they only have one permit remaining before they can become operational.

The project has been over a decade in the making and has yet to start operations, but the Public Utilities Commission's decision could bring new hope.

"It's hard to see something take so long," said Excelsior Co-CEO & President, Tom Micheletti, "I know what's happening in the energy market and this project and its site, with all of the permits basically issued, is going to be extremely valuable."

However, the project still stands without a customer and that's a concern for those worried about the millions of dollars in public funding spent on the project.

"I want the jobs and I want the investment of public money back," said Representative Tom Anzelc.

Rep. Anzelc says that while this is the closest the project has ever been to becoming operational, he's still concerned about all the public money at risk.

"Concern continues to be what it has always been and that is that of the taxpayer's contribution to a project that has not come to fruition," said Rep. Anzelc.

Senator Dave Tomassoni says that the investment is worthwhile and that new developments on the Iron Range could create a need for additional power, which the Mesaba Energy Project could provide.

"It's all about investing and getting the plant built," Senator Tomassoni said, "Building a billion dollar plant and hiring some people and providing some energy for the long term is a pretty good investment."

Micheletti says that he's confident that the project will be able to secure a customer.

"There's going to be potentially an energy crunch," he said, "We're ready to build a lot of electric power on the Iron Range when that happens."

Public funding for the project includes a $9.5 million loan from the IRRRB. Senator Tomassoni says that the loan's payback is contingent on whether or not the project gets built, but Excelsior is current on their payments.

Written for the web by Jennifer Austin.