Wednesday, February 09, 2000

Great River Energy of Elk River has received the Mower County Board of Commissioners’ endorsement for a personal property tax exemption.

Now, the county commissioners are waiting for GRE to decide what financial consideration they will pay Mower County.

"Yes," said Richard R. Lancaster, GRE’s vice president for public affairs, "we are happy to receive the county board’s endorsement.

"A financial consideration or a payment in lieu of taxes is still being negotiated," he said. "This is good for us and we are working to resolve all the issues we have with Mower County. We’re still taking this one step at a time and there are many more steps to take before we take that final step toward concluding the process."

GRE plans to construct a 445-megawatt natural gas-fired power generation facility in Pleasant Valley Township. The facility will provide peaking power to GRE’s 29 member distribution cooperatives beginning in the spring of 2001.

The facility will consist of three, simple-cycle combustion turbines. The primary fuel for the facility will be natural gas, chosen for its low air emissions and ready availability.

Fuel will be delivered to the site via the Northern natural gas pipeline running along the northern tier of townships. A backup fuel-oil supply will be installed on site in case of interruption in the natural gas supply.

In several public meeting appearances in Mower County, Lancaster has argued GRE needs the personal property tax exemption on utility equipment.

A similar exemption was obtained by Lakefield Junction in Martin County.

The facility will cost upwards to $160 million with an anticipated $7 million in taxes to pay the first year. Lancaster has frequently explained, "Our plant will not be competitive if it is subjected to this level of taxation."

GRE still will pay real property taxes on the plant and personal property tax on the new natural gas line and transmission improvements. They could total between $500,000 and $600,000 a year.