Granite Falls, Minn., opts against pursuing ownership of 107-year-old dam
GRANITE FALLS -- Xcel Energy will be awarding a bid for the demolition of the 1905-built Minnesota Falls dam in August, unless a party unexpectedly steps forward with an interest to purchase it.
Jim Bodensteiner, director of environmental affairs for Xcel, said the company is moving down the path toward demolition in the wake of a recent decision by Granite Falls Energy not to seek ownership of the dam.
The ethanol company had recently notified the City of Granite Falls and Chippewa and Yellow Medicine counties that it is ending its pursuit of ownership.
The City of Granite Falls was the last party to express any interest in ownership of the dam. It is not likely to pursue it, according to Mayor David Smiglewski.
The ethanol company determined that it would be too costly to restore the dam, according to Kevin Stroup of Marshall, attorney for GFE. The ethanol company also determined that the economics of retro-fitting the dam to hold hydro-electric generation were not favorable.
GFE's board of directors was especially concerned about the unknowns associated with future maintenance costs and regulatory matters, and the risk represented to shareholders, said Paul Enstad, chairman of the board,
The ethanol company has its water intake located above the dam, but will be able to modify it and continue to obtain the water it needs when the dam is removed. It will be less expensive to modify the intake than earlier estimates indicated, Stroup said.
Xcel Energy is on track to award a contract for the dam's removal, quite likely in mid-August, according to Bodensteiner. It began a drawdown of the Minnesota River on July 18 to prepare for the work.
A contractor would begin work by developing access to the site and constructing a water control structure. Actual demolition could occur as early as October, if all goes as planned, said Bodensteiner.
The project will require removing an estimated 10,000 cubic yards of sediment and the concrete dam and channels that had been part of a hydro-electric system.
A previous study of the 107-year-old structure found several potential structural deficiencies. The Minnesota DNR ordered the company to either repair the dam or remove it. An initial study indicated that it would cost $2 million plus to remove it, as compared to over $5 million to repair it.
Xcel no longer has any use for the dam. It represents a liability and on-going maintenance cost that does not benefit the company's rate payers or shareholders, said Bodensteiner.
Its hydro-electric system was removed in 1961. The reservoir created by the dam provided cooling water for the Minnesota Valley generation plant located upstream, but the 1930's-vintage coal plant was retired in 2009. It is slated to be demolished in the years ahead.
The dam is 600-feet wide and 14.5 feet high. It is calculated that its removal will restore a natural, 10-foot fall at the site, quite possibly as a cascading series of rapids.