Xcel grows solar as central MN coal plant winds down

For decades, central Minnesota’s Sherburne County Generating Station, known as Sherco, burned thousands of tons of coal every day to generate electricity.

The plant’s owner, Xcel Energy, is winding down operations in the next few years. Xcel is building a massive solar energy facility at the Sherco site near Becker and Clear Lake to replace some of the electricity produced by coal.

With the completion of its third phase, the project is now one of the largest solar facilities in the U.S. Xcel has plans to make it even bigger.

“We’re obviously the largest in the state of Minnesota, and one of the largest in the Midwest for sure,” senior operations manager of Sherco Solar Luke Molus said.

As a teenager, Molus spent summers picking strawberries and sorting potatoes on this land. Now he oversees nearly 1.7 million solar panels covering the same fields.

“We’re farming the sun,” he said.

Xcel shut down the first coal-fired unit at Sherco three years ago. A second unit is scheduled to close at the end of this year, and the final unit will retire in 2030.

The third phase of Sherco Solar began delivering electricity to the grid at the end of June. Combined, the three phases produce 710 megawatts of electricity, enough to power about 150,000 homes.

“It’s really helping to elevate Minnesota as a leader when it comes to the clean energy transition,” said Gregg Mast, executive director of Clean Energy Economy Minnesota, an industry-led nonprofit.

Mast said Sherco is one of a number of renewable energy projects that will help utilities meet the state’s law requiring carbon-free electricity by 2040.

“That’s really exciting for Minnesotans to see what this energy innovation and this transition can look like in real time,” Mast said.

But tariffs and shifting federal policy has created challenges for the solar industry. Levies imposed by the Trump administration on imported solar panels, batteries and other components have driven up construction costs. And the One Big Beautiful Bill Act, which President Donald Trump signed into law last summer, phased out federal tax credits for utility-scale solar projects.

Will Mulhern, director of the electricity program at the nonprofit advocacy group Fresh Energy, said he doesn’t think those challenges will deter developers from building renewable energy projects.

“I think we continue to see that solar and wind and storage are extremely competitive technologies with traditional fossil fuels because they don’t have fuel costs, and capital costs are really coming down,” Mulhern said.

Central Minnesota might not seem like an ideal place for solar power, but Molus said in the summer, production at Sherco Solar rivals sunny states like Texas and New Mexico.

“We’re right there with them in the summer,” he said. “Obviously, we get a little bit less hours of sunlight in the winter, but we do see pretty good production in those winter months.”

Solar panels actually perform more efficiently in cooler temperatures, Molus said. And when snow covers the ground, it reflects light on the back of the panel, increasing production.

In the next month or two, Xcel is expected to file plans with state regulators to add a fourth phase of solar at Sherco, with an additional 200-megawatt array in Clear Lake Township. If approved, construction would likely start by the end of next year, Molus said.

The utility also has plans for two battery storage systems near the coal plant. Xcel says the batteries will use Sherco’s existing connections to the power grid, allowing it to store energy produced across the Upper Midwest and release it during periods of high demand for electricity.

Batteries help extend the period of time that utilities can access wind and solar energy, Mulhern said.

“So as we try to decarbonize, we’re able to bring more and more renewables onto the grid and use them at the times when we really need them — even if those resources aren’t actively generating,” he said.

Meanwhile, the Trump administration has ordered coal plants in other states that were scheduled for retirement to keep operating.

If such an order is issued for Sherco, Xcel will follow it, Molus said, but it won’t derail the company’s long-term plans for Sherco.

“It won’t change anything the way that Xcel’s progress and vision is going towards the future,” he said.