Resilient By Design

Cheers, camaraderie and fellowship filled Minnkota’s conference center on April 1 as the cooperative held its first in-person annual meeting in nearly three years. The 82nd annual meeting gathered about 150 members and key power partners to celebrate the past year’s success and look ahead to the opportunities on the horizon.

The meeting’s theme, Resilient By Design, recognized how Minnkota persevered through the pandemic, volatile energy market conditions and rapid industry change. Minnkota Board Chair Les Windjue opened by thanking employees for showing strength in the face of adversity.

“These past few years have not been easy,” Windjue said. “You have faced many challenges and uncertainties – both at work and at home. On behalf of the board, I want you to know that we value your hard work and perseverance.”

In reviewing 2021, Minnkota leaders pointed to an increase in industry change and volatility. One of the most pivotal moments of the year came in February when extreme cold weather caused significant grid instability and outage issues across the United States. Minnkota experienced limited negative impacts due to the reliable operation of the coal-based Milton R. Young Station, the strength of its power delivery system and the strategic use of the demand response program.

“We’re in a time when the industry is changing faster than it ever has before,” Mac McLennan, Minnkota president and CEO, said in his closing address. “We routinely have to make 50-plus year decisions, but we live in a society that wants instantaneous change. Our challenge is to find the best way to balance reliability, affordability and sustainability.”

Although there is tremendous uncertainty, the organization is working to define its own path forward through major power supply planning efforts and the evaluation of Project Tundra – an effort to build the world’s largest post-combustion carbon capture project at the Young Station. In 2021, progress was made in the engineering and design of the carbon capture and storage facilities, while also refining the economic model. Those efforts will continue in the coming year in anticipation of making a final decision on whether to move forward by the end of 2022.

“We’ve done a phenomenal amount of work to model Project Tundra against numerous power supply alternatives,” McLennan said. “For the rest of 2022, we’re going to work on carbon reduction strategies, while reducing our exposure to price and market volatility. There’s no risk-free path forward, but there are things we can do to better position ourselves for the energy transition ahead.”

Financial rebound

Following a difficult financial year in 2020 due to impacts of the COVID-19 pandemic, Minnkota rebounded in 2021 and had one of its best financial years in recent memory. The improved position is thanks in large part to stronger wholesale energy markets, increased member sales and the growth of new data center facilities in member service areas.

“With our cooperative in solid financial condition, the board took action to extend its deferred revenue plan through 2024,” Windjue said. “The board also approved placing $10 million into a new Resource Transition Fund, which will be used to manage future power supply costs or extreme market volatility. The board will be reviewing our Financial Goals Policy in 2022 and continues to look for ways to maintain financial strength.”

Minnkota’s long-range financial forecast is also showing improvement. Wholesale rates over the next decade are anticipated to be approximately the same, although major power plant outage expenses will need to be managed during upcoming years.

Square Butte sees success

Square Butte Electric Cooperative also held its 48th annual meeting on April 1 at Minnkota’s headquarters. Square Butte owns the Unit 2 generator at the Young Station and is governed by the same 11 cooperatives that own Minnkota.

“Unit 2 performed exceptionally well during the year, running reliably and meeting all land, water and air quality standards,” said Paul Aakre, Square Butte president. “The facility was available to produce power 90.7% of the time, including during major grid challenges caused by extreme cold weather.”

Looking ahead, Aakre said that Square Butte is committed to making the necessary investments to ensure the plant can continue to perform well.

“We have scheduled a three-month major maintenance outage on Unit 2 in the fall of 2022,” Aakre said. “Our planning efforts for this outage began earlier than ever to stay ahead of global supply chain challenges. Thorough inspection work and other projects will be completed during the outage with a goal of positioning the facility for long-term operation.”

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Awards presented

Minnkota’s cooperative family includes many long-term leaders who were recognized at the meeting, including:

• Mark Habedank received the Electric Hammer Award recognizing his 25 years of service to Wild Rice Electric Cooperative.

• John Lund, Beltrami Electric Cooperative, and Marcy Svenningsen, Cass County Electric Cooperative, received the Red Lantern Award recognizing their 10 years of service on their respective boards.

In addition to the awards, the Minnkota board passed a resolution recognizing Svenningsen as she stepped down from the board and accepted a new role as Farm Service Agency state executive director for North Dakota.

Roger Amundson was also honored with a resolution for his 17 years of service to the Square Butte board and 21 years of service to the Roseau Electric Cooperative board.

New directors elected

During the business session and reorganization meetings, new delegates and officers were elected to the Minnkota and Square Butte boards.

The Minnkota board reelected Windjue, Nodak Electric Cooperative, as its chair and Habedank, Wild Rice Electric, as vice chair. Colette Kujava, Red Lake Electric Cooperative, was reelected as secretary-treasurer.

Other directors elected to one-year terms were: Rick Coe, Beltrami Electric Cooperative; Kalvin Hoff, Cass County Electric Cooperative; Tony Ottem, Cavalier Rural Electric Cooperative; Greg Spaulding, Clearwater-Polk Electric Cooperative; Steve Arnesen, North Star Electric Cooperative; Tom Woinarowicz, PKM Electric Cooperative; Roger Krostue, Red River Valley Cooperative Power Association; and Mike Wahl, Roseau Electric Cooperative.

At the Square Butte annual meeting, Aakre, PKM Electric, was reelected as president of the Square Butte board of directors and Larry Sollie, Wild Rice Electric, was reelected vice president. Murl Nord, Beltrami Electric, was elected secretary-treasurer.

Other directors elected to the board for one-year terms were: Terry Kraft, Cass County Electric; John Martinson, Cavalier Rural Electric; Bill Lanners, Clearwater-Polk Electric; David Kent, Nodak Electric; Mike Hanson, North Star Electric; Peter Mosbeck, Red Lake Electric; Marvis Thompson, Red River Valley Co-op Power; and Shawn Gust, Roseau Electric.

Main image: About 150 members and guests attended the annual meetings on April 1 at Minnkota’s headquarters. (Minnkota/Michael Hoeft)