Despite economic turbulence in the solar energy market, Flint Hills Resources said Tuesday it will spend $75 million to proceed with a large solar array at its oil refinery in Rosemount.
Flint Hills moving forward with $75M solar project at its Rosemount refinery
The company is proceeding with the solar array, which will be one of the largest in Minnesota, despite the solar industry's current woes.
May 10, 2022 at 8:51PM
The facility — with 50 % more power generation than originally planned — will be the largest of its kind for a U.S. oil refinery.
"There is really nothing like this," said Jake Reint, a Flint Hills spokesman.
It will also be one of the largest U.S. solar plants devoted to — and owned by — a single customer, as well as one of the larger solar facilities in Minnesota. Flint Hill's 45-megawatt plant will host over 100,000 solar panels. It will produce enough energy to power up to 8,400 homes.
The state's biggest solar farm currently is Xcel Energy's 100-megawatt array in Chisago County, though even larger projects are in the pipeline.
Flint Hills in early 2021 announced it was considering the solar plant as a way to cut its electricity bill with carbon-free power. Three months ago, Rosemount's city council approved a necessary permit for the 314-acre project.
Flint Hills' Pine Bend plant is one of the biggest oil refineries in the Midwest and Minnesota's largest motor fuel supplier. It's also one of the Upper Midwest's largest producers of aviation fuel and asphalt.
Oil refining consumes huge amounts of electricity, and Flint Hills — an arm of Wichita, Kan.-based Koch Industries — is one of Xcel's biggest Minnesota electricity customers. But the refinery has been working to cut its power costs in recent years.
In 2019, Flint Hills invested about $100 million in a 50-megawatt, on-site power plant. That generator, part of a combined heat power system, is fueled by natural gas and waste heat and provides about 40% of the plant's electricity.
The new solar array on average will provide another 10% to 12% of the refinery's electricity needs. But when the sun is shining, the solar array and the power plant can provide up to 70% of Pine's Bend's power, according to the company.
Construction of the solar array will start soon, with an expected completion date in 2023. Scottsdale, Ariz.-based Depcom Power will engineer and build the project.
Many solar projects nationally have been put on hold as the industry is currently in economic tumult despite federal tax credits used to help with financing.
Like many industries, solar has been hurt by rising equipment prices because of inflation coupled with supply chain constrictions. In addition, a federal investigation into solar panel imports has stymied exports from Asia, the world's main producer of solar equipment.
The investigation stems from a complaint by a small U.S. solar panel manufacturer. It accuses Chinese solar manufacturers of dodging U.S. tariffs by routing operations through other Asian countries, including Vietnam and Malaysia.
As much as 17.5 gigawatts of planned U.S. solar capacity installations in 2022 are in doubt due to the U.S. Commerce Department's inquiry, Rystad Energy research shows. (A gigawatt equals 1,000 megawatts.)
Reint said Flint Hills doesn't expect the industry's current challenges to affect the Rosemount project.
"We are confident we will be OK," he said.
Health officials say the recent outbreak of the highly contagious virus looked bad this summer, but optimism is growing they may have contained it.
