What's New
Investment in gasification plant pays dividends
Bismarck, N.D. - An investment in a coal gasification plant is now producing rich rewards for about 2.5 million rural electric consumers in nine states.
The "investment" was a decision in 1988 to purchase and operate the Great Plains Synfuels Plant near Beulah, N.D. It was purchased by Dakota Gasification Company (DGC), a subsidiary of Basin Electric Power Cooperative formed to operate the plant.
The "dividend" amounted to $19.8 million, which is being returned to Basin Electric's 120 member systems as a credit in their April 2007 electric bills.
Since 1988, there have been some challenges for maintaining the economic stability of the Synfuels Plant. But in the last three years, DGC has repaid its loans and has generated substantial revenue as Basin Electric's largest for-profit subsidiary, according to Clifton Hudgins, Basin Electric's chief financial officer. He said DGC is now virtually debt-free. "The credit for this success story can be attributed to sound management, excellent employee performance, diversification of products, and fiscal responsibility," he said. "Given the market volatility of the price of natural gas, DGC has mitigated losses by using marketing and innovative product development to broaden its byproduct and co-product revenue while strengthening the financial underpinnings of the Synfuels Plant."
Early last year, a plan was formulated that would return profits from the subsidiary to Basin Electric and its membership. "This innovative plan returns profits to the members while maintaining DGC's ability to continue its safe and efficient operation," Hudgins said.
Basin Electric is a consumer-owned, regional cooperative headquartered in Bismarck. It generates and transmits electricity to 120 member rural electric systems in nine states: Colorado, Iowa, Minnesota, Montana, Nebraska, New Mexico, North Dakota, South Dakota, and Wyoming. These member systems distribute electricity to about 2.5 million consumers.
Basin Electric's generating resources include two coal-based power plants in North Dakota - the Antelope Valley Station, Beulah, and the Leland Olds Station, Stanton; a coal-based power plant in Wyoming - the Laramie River Station, Wheatland; an oil-based peaking station - the Spirit Mound Station, Vermillion, S.D.; nine combustion-turbine generators (natural gas) in the Gillette, Wyo., area; two gas-fired peaking stations - the Groton Generation Station near Groton, S.D., and the Wisdom Station Unit 2 near Spencer, Iowa; four wind turbines - two near Minot, N.D., and two near Chamberlain, S.D. Basin Electric purchases the entire output of three wind farms owned and operated by FPL Energy - one near Edgeley/Kulm and one near Wilton in North Dakota, and another near Highmore in South Dakota; and two other 750-kilowatt wind turbines, one located near Pipestone, Minn., and another near Rosebud, S.D. Basin Electric also purchases the entire production of four recovered energy projects located along the Northern Border Pipeline.
The "investment" was a decision in 1988 to purchase and operate the Great Plains Synfuels Plant near Beulah, N.D. It was purchased by Dakota Gasification Company (DGC), a subsidiary of Basin Electric Power Cooperative formed to operate the plant.
The "dividend" amounted to $19.8 million, which is being returned to Basin Electric's 120 member systems as a credit in their April 2007 electric bills.
Since 1988, there have been some challenges for maintaining the economic stability of the Synfuels Plant. But in the last three years, DGC has repaid its loans and has generated substantial revenue as Basin Electric's largest for-profit subsidiary, according to Clifton Hudgins, Basin Electric's chief financial officer. He said DGC is now virtually debt-free. "The credit for this success story can be attributed to sound management, excellent employee performance, diversification of products, and fiscal responsibility," he said. "Given the market volatility of the price of natural gas, DGC has mitigated losses by using marketing and innovative product development to broaden its byproduct and co-product revenue while strengthening the financial underpinnings of the Synfuels Plant."
Early last year, a plan was formulated that would return profits from the subsidiary to Basin Electric and its membership. "This innovative plan returns profits to the members while maintaining DGC's ability to continue its safe and efficient operation," Hudgins said.
Basin Electric is a consumer-owned, regional cooperative headquartered in Bismarck. It generates and transmits electricity to 120 member rural electric systems in nine states: Colorado, Iowa, Minnesota, Montana, Nebraska, New Mexico, North Dakota, South Dakota, and Wyoming. These member systems distribute electricity to about 2.5 million consumers.
Basin Electric's generating resources include two coal-based power plants in North Dakota - the Antelope Valley Station, Beulah, and the Leland Olds Station, Stanton; a coal-based power plant in Wyoming - the Laramie River Station, Wheatland; an oil-based peaking station - the Spirit Mound Station, Vermillion, S.D.; nine combustion-turbine generators (natural gas) in the Gillette, Wyo., area; two gas-fired peaking stations - the Groton Generation Station near Groton, S.D., and the Wisdom Station Unit 2 near Spencer, Iowa; four wind turbines - two near Minot, N.D., and two near Chamberlain, S.D. Basin Electric purchases the entire output of three wind farms owned and operated by FPL Energy - one near Edgeley/Kulm and one near Wilton in North Dakota, and another near Highmore in South Dakota; and two other 750-kilowatt wind turbines, one located near Pipestone, Minn., and another near Rosebud, S.D. Basin Electric also purchases the entire production of four recovered energy projects located along the Northern Border Pipeline.
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