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MN — Power Infrastructure Updated 2026-01-08

Minnesota

MISO Natural Gas Nuclear Solar Wind Storage Data Center PPAs Queue Bottlenecks Transmission Constraints

Overview

Minnesota’s power infrastructure is in transition from coal to a mix of natural gas, renewables, and utility-scale battery storage. The Becker/Sherco hub has emerged as the state’s key power node, with major solar, storage, and transmission projects converging at the site of a retiring coal plant. MISO queue backlogs and long-lead transmission upgrades mean data center developers face multi-year timelines for firm capacity, especially outside established 345-kV corridors.

Generation Projects

Solar

Xcel Energy is building out the Becker area with two phases of solar at the Sherco plant site. Sherco Solar is a 460-MW project with Phase 1 completed in 2024 and Phase 2 in 2025, using existing transmission infrastructure at the retired coal plant.[3] In November 2025, Xcel filed to expand Sherco Solar with an additional 200-MW array in Clear Lake Township, adding more capacity to the same transmission hub.[4]

Wind

Minnesota Power’s 2025 IRP commits to 400 MW of new wind capacity by 2035, on top of 700 MW of renewables already under development. Wind is positioned as the main source of incremental energy supply on the utility’s northern Minnesota system.[2]

Natural Gas

Xcel Energy’s approved Upper Midwest Energy Plan includes a hydrogen-capable natural gas plant in Lyon County, paired with the proposed Minnesota Energy Connection transmission line from the Sherco site. The plant is designed to provide firm capacity for large load growth.[1]

Minnesota Power’s 2025 IRP calls for refueling Boswell Unit 3 to natural gas (355 MW) by 2030 and adding about 750 MW of new gas capacity by 2035. This is the utility’s stated path to replace coal while keeping firm capacity available.[2]

Nuclear

Xcel Energy’s Upper Midwest Energy Plan extends the operating lives of Prairie Island and Monticello, preserving several hundred megawatts of carbon-free firm capacity for the next decade-plus.[1]

Battery Storage

Xcel Energy’s 2025 filing proposes doubling approved storage at the Sherco Energy Hub from 300 MW to 600 MW, making it the largest battery storage site in the Upper Midwest. The filing also includes 135.5 MW of storage at the Blue Lake facility in Shakopee, near Twin Cities data center sites.[4]

Minnesota Power’s 2025 IRP targets 100 MW of new energy storage by 2035 on its northern Minnesota system.[2]

Transmission and Grid

Three major 345-kV transmission projects are moving forward to strengthen Minnesota’s ability to move power between generation hubs and load centers.

The Northland Reliability Project is an approximately 180-mile double-circuit 345-kV line from northern Minnesota to central Minnesota, designed to move power toward areas with large load growth. The Minnesota PUC granted the certificate of need and route permit in February 2025.[5]

Xcel Energy’s Mankato–Mississippi River Transmission Project includes about 120 miles of new and upgraded 345-kV lines from Mankato to the Mississippi River near Kellogg, plus roughly 20 miles of new 161-kV lines near Rochester. This project strengthens the south-central corridor for new generation and load growth.[6]

The Minnesota Energy Connection transmission line runs from the Sherco site to Lyon County, paired with Xcel’s new gas plant. It is designed to move firm capacity and renewable energy across southwest Minnesota.[1]

Data Center Power Agreements

Xcel Energy’s public statements confirm that the Minnesota PUC approved its power supply agreement with Meta for the Rosemount data center. The agreement pairs utility service with Meta’s commitment to 100% renewable energy through Xcel-provided renewables and renewable energy credits (RECs).[7]

Interconnection Queue

MISO’s December 2024 Generator Interconnection Queue Update reports a large queue volume and a growing backlog that prevents one-year study timelines. The update flags a widening resource adequacy gap driven by economic development and new large-load additions, noting that queue reforms such as volume caps and study automation are not yet sufficient to meet near-term regional needs.[8]

Because Minnesota’s major utilities operate within MISO, these queue delays apply directly to new generation needed for data centers. Large loads are competing for scarce transmission capacity and long-lead upgrades, which can push reliable in-service dates well beyond typical data center build timelines.

What to Watch

  • Xcel Energy’s Sherco Energy Hub expansion filings, which will determine whether the 600-MW storage target and additional solar arrays move forward on schedule.
  • MISO queue reform progress and whether study timelines improve enough to support data center-scale generation projects with near-term in-service dates.
  • Minnesota Power’s IRP implementation, especially the timeline for new gas capacity and wind additions on the northern system.

Sources

[1] Xcel Energy, “Xcel Energy gains approval for new energy resources to deliver reliable, clean energy in the Upper Midwest,” February 20, 2025, https://newsroom.xcelenergy.com/news/xcel-energy-gains-approval-for-new-energy-resources-to-deliver-reliable-clean-energy-in-the-upper-midwest (accessed 2026-01-08).

[2] Minnesota Power, “2025 Integrated Resource Plan (Plan Highlights),” 2025, https://minnesotapower.blob.core.windows.net/content/Content/Images/Environment/EnergyForward/2025IRP.pdf (accessed 2026-01-08).

[3] Xcel Energy, “Sherco Solar Project Information Sheet,” 2022, https://www.xcelenergy.com/staticfiles/xe-responsive/Energy%20Portfolio/Renewable%20Energy/Sherco-Solar-info-sheet.pdf (accessed 2026-01-08).

[4] Xcel Energy, “Xcel Energy to build Upper Midwest’s largest battery storage site,” November 3, 2025, https://newsroom.xcelenergy.com/news/xcel-energy-to-build-upper-midwests-largest-battery-storage-site (accessed 2026-01-08).

[5] Minnesota Public Utilities Commission, “Northland Reliability 345 kV Transmission Line Project,” February 28, 2025 (order granting certificate of need and route permit; project description), https://puc.eip.mn.gov/web/project/15114 (accessed 2026-01-08).

[6] Xcel Energy, “Mankato to Mississippi River Transmission Line Project,” n.d., https://xcelenergytransmission.com/projects/mankato-mississippi-river/ (accessed 2026-01-08).

[7] Xcel Energy, “Building the 21st-century economy: Xcel Energy to power new Meta data center,” March 15, 2024, https://stories.xcelenergy.com/stories/Building-the-21st-century-economy—Xcel-Energy-to-power-new-Meta-data-center (accessed 2026-01-08).

[8] Midcontinent Independent System Operator (MISO), “Generator Interconnection Queue Update (System Planning Committee of the Board of Directors),” December 10, 2024, https://cdn.misoenergy.org/20241210%20System%20Planning%20Committee%20of%20the%20BOD%20Item%2004%20Generator%20Interconnection%20Queue%20Update665714.pdf (accessed 2026-01-08).