When Will Kaul got his first job in Minnesota's electricity business, turmoil ruled. It was the late 1970s, a time of protests over building new power lines. Kaul, an economics major in college with a background in environmental management, joined Cooperative Power Association, which was in the middle of a power line battle. Cooperative in 1999 merged with United Power Association to form Great River Energy, a wholesale power producer that today serves 28 retail co-ops in Minnesota, which in turn have 685,000 customers. Kaul long served as the head of Great River's transmission department, where he was at the heart of a huge transformation in the electricity business.
While Great River still gets the majority of its power from coal — specifically a giant plant in west central North Dakota — wind power has increasingly changed the business. All those wind farms rising across the Upper Midwest have helped lead to a big new transmission line build-out over the past decade, but one with relatively little of the 1970s rancor.
The $2.1 billion project, known as CapX2020, covers Minnesota, Wisconsin and the Dakotas with 725 miles of high voltage lines. It's the work of 11 power producers, including Great River. The last leg of CapX2020 in Minnesota — home to most of the project — was completed last year.
The Star Tribune recently talked with Kaul, who retired this month, about the transformation of the transmission grid.
Q: You have been through two major transmission investment cycles. Tell me about the first one.
A: In the 1970s, several large coal-fired plants were built in Minnesota and North Dakota, including our Coal Creek Station. With Coal Creek came a high-voltage transmission line extending from North Dakota to Delano, Minn.
Q: That was an era of power line controversy, right?
A: It was in the news every day for years. That was our power line. It was crossing agricultural land, so there was a lot of concern by farmers. There was a lot of concern about the process. It was right post-Watergate and trust in institutions was at an all-time low. Seven lawsuits were filed against the electric co-ops and were consolidated. Co-ops won the case and Gov. Rudy Perpich had to call out state troopers to enforce the peace in rural Minnesota, so that surveyors could start work. We had 13 towers that were toppled, several of them while the line was energized with 8,000 volts.
Q: What was the second big wave of electricity investment?
A: Around the turn of the [21st] century, a tremendous amount of natural gas-fired power plants were built, starting a major grid expansion that is continuing to this day. Then there is renewable energy, which is huge now. Also, the wholesale power business has totally transformed because of deregulation in the 1990s. The grid used to be a privately owned network with voluntary coordination among utilities. The private network is a now an open-access common carrier governed by independent nonprofit power pools — in the Upper Midwest's case, MISO. The old grid didn't facilitate an efficient wholesale market. It led to congestion, which required more transmission capacity.
There's also been a large reliability factor driving new transmission projects. We had the big East Coast blackout in 2003, California blackouts around 2000, and we've had close calls around here with reliability. In fact, the main driver of CapX2020 was concerns about reliability.
Q: How did increasing amounts of wind energy fit into CapX2020?
A: Our plans included transmission that would be able to bring 25 percent renewable energy into our market. Wind farms are located in sparsely populated areas where there isn't transmission. There's also the ability of the grid to absorb the variability of renewable energy. The more transmission capacity you have, the more flexible and resilient the system is when the wind is blowing and wind power is surging into the market. We have had days in MISO where over 50 percent of the energy is wind. With the transmission expansion we've been working on, the grid has been able to operate just fine.
Q: CapX2020 didn't generate the mass protests of the '70s. Why is that?
A: I have a lot of scar tissue left over from the '70s. I was on the cleanup crew. I said never on my watch will that happen again. All of the utilities entered into this of the mind that we are going to do this right. We needed to have a vision for what grid expansion looks like. We needed to fit it into a narrative that would make sense and that we could communicate to people and build a foundation for political support.
Q: How do you get that foundation built?
A: We spent two years before we did anything through the regulatory process. We were out in the field. We talked to every editor of a newspaper, every county commissioner — anybody who would listen. We had open houses and we invited the community in. And we had a strong coalition with all of the environmental groups, with regulators, with every possible stakeholder. Everyone supported what we are doing. There was a harmonic convergence.
Q: Is CapX 2020 going to allow enough transmission capacity? You have seen a lot of announcements recently about more wind farms.
A: CapX is going to take care of us in Minnesota for a while. But other transmission needs have been identified outside of the CapX footprint. There's a tremendous wind resource in Iowa and the Dakotas.
