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Xcel System Upgrades
Project Description and Background
Xcel Energy is completing system upgrades within the City of Victoria.  The City has chosen to direct Xcel Energy to bury the new lines underground.  The City, per state statute and Public Utilities Commission regulation, is also required to pay the cost differential that will be incurred to bury the lines.  The total cost is estimated at $1.25 m to $1.75 m.  In order to pay for the project, the City has instituted a franchise fee of approximately $3 month which is paid on your gas (Centerpoint Energy) and electric (MVEC or Xcel Energy) bill. The process to enter into franchise agreements began in Summer 2016 and were adopted on October 10, 2016, with fee collection beginning in 2017. 

Construction is underway in the Fall of 2016 and is expected to be complete by the end of the year.  

Planned Power Outages

As Xcel is converting their Victoria customers over to the upgraded system that was installed last year, some outages will be experienced. Xcel will be notifying each impacted resident either by mail or pre-recorded voice message a few days in advance of the outage. Outages are planned to occur between the hours of 4:00am and 6:00am on pre-determined dates.  The City has been provided with approximate areas and dates for expected outages, but the maps and dates are subject to change. For the most up-to-date information, please contact Marilyn Skelton with Xcel at 952-470-3328.

Power Outage on 4/20/17
Power Outage on 5/2/17
Power Outage on 5/4/17
Power Outage on 5/18/17

Additional Background Information:

September 22, 2016 Letter to Residents 
July 11, 2016 Public Listening Session 
July 11, 2016 Xcel Energy Responses to Questions from City
Notice of June 28, 2016 Informational Meeting 
May 9, 2016 City Council Meeting: See Item 8B
October 20, 2015 Letter from Xcel Energy
October 12, 2015 City Council Meeting: See Item 9B
September 24, 2015 Letter to Xcel from City staff 
Map of Electric Service Providers 

Carver County CUP for substation 

October 20, 2015 Planning Commission Minutes 
Letters from City of Victoria to Carver County and Xcel Energy
Conditional Use Permit - Board Order

Franchise Fee Process: 

July/August 2016
Drafted and Negotiated Franchise Agreements with MVEC, Xcel, and Centerpoint 

October 2016
City Council adopted ordinances related to agreements and fees.  

February 2017
Fee collection begins 


The following questions were drafted and submitted by a group of Victoria residents.  Answers are from the City of Victoria and Carver County.  Posted Saturday, July 2, 2016.

Questions (in no particular order)

1. Who has jurisdiction over the 'where' and 'how' of power lines in Victoria?  How can we get clarity on this?  

City:  Xcel and other utilities have rights to access the Right-of-Ways.  The City can use the permit to guide placement within the right-of-way, to evaluate safety concerns, make plans for restoration work, understand construction schedules, request resident notifications, etc, but do not have the latitude to deny the permit. 

County:  Xcel and other utilities have rights to access the Right-of-Ways.  The County can coordinate but does not have ultimate authority.  We can deny a permit in a county road right of way if the location would be likely to cause a traffic safety issue.  We have no other authority over the location or existence of a power line.       

2. Whose job is it to inform the various residents and organizations that are impacted by the Plan B route, or any other route for that matter?  When and how will this happen?  

City:  There are no notice requirements for this project.  The City did send a letter to all property owners that are adjacent to Alignment B on June 22, 2016, after being notified on June 20, 2016 that Xcel had selected Option B.  Information about the Xcel projects was available as part of the City Council packets for October 12, 2015 and May 9, 2016.  The City has also created this page to aggregate and provide the latest information.

County:  The County does not have a role in notifying residents of power line routes.   The County strongly believes that Xcel should notify residents of its plans whenever it contemplates a new power line route.  

3. Do projects like this that impact the public require a public comment period?  If so, when did this take place?  If it hasn't happened, when could such an event be organized where City and County official are present? 

City and County:  Xcel is not subject to public comment periods for distribution lines.  In 2013, the legislature enacted requirements for a public process when new transmission lines are being considered.  The City is hosting an informational meeting on Tuesday, June 28th at 6 pm at Victoria City Hall.  However, neither City nor County officials have authority over this project. 

4. Does a project like this require an environmental study?  Are the wetland areas north of CR 18 impacted by these lines? 

City:  The City has passed this question along to Xcel and asked them to be prepared to respond at the 6/28 meeting. 

County:  The County does not have a role vis-a-vis environmental impact.  That may be a question for a state agency.  

5. What sort of due diligence was conducted by County to examine the site proposal for the sub station, especially given that most Xcel customers in Victoria reside on the north side of the city?  Similarly, what other municipalities and counties will benefit from this substation?  What, if any burden, do they share with the cost?  

City:  Xcel Energy will be present at the 6/28 meeting to discuss the system benefits and the communities that benefit.  The City of Victoria did inquire as to whether the CFRS (community facility recovery surcharge) could be imposed on customers in all benefiting communities, thereby making the CFRS a possible viable solution for paying to underground the new lines.  The law does not provide that ability, the surcharge can only be imposed on the requesting community.  

County:  The Planning Commission held 2 public hearings, on October 20 & November 17 in 2015.  The substation is located in Laketown Township.  The County sent seventy (70) hearing notices directly to neighbors of the proposed substation on October 1, 2015 and to Laketown Township, the cities of Chaska and Victoria, Minnehaha Creek Watershed District , and the Minnesota Department of Natural Resources.  The County also published legal notice of the hearing in the Chaska Herald on October 8. The Planning Commission extended (continued) the public hearing from the October 20  meeting to the November 17 meeting to allow for additional review and discussion- principally regarding Victoria & Chaska issues.  After a full County staff review of the application, the Planning Commission found that Xcel met all of the requirements for a Conditional Use Permit (CUP) for the substation and recommended the CUP with the following condition:

“Permittee shall work with the City of Victoria regarding co-location of overhead lines” 

The documents prepared in the course of the County staff and Planning Commission's review of the  CUP application. are posted above.   Pursuant to the Planning Commission's  recommendation, the County Board issued a Board Order granting the CUP in December 2015.  

6. What sort of due diligence was conducted by the City and/or County to examine the plan for power lines given the negative impact they would have on the community?  Most power lines in Victoria are above ground. Was this a part of the original city plan?  If so, why doesn't that still apply today? 

City:  Power lines in new developments are underground, which occurs at the cost of the developer.  The City has also invested funds to underground some power lines in downtown Victoria.  The City does not have authority over the project.  The option available to the City is to direct Xcel to underground the lines and pay the incremental cost difference, estimated at 1.25m to 1.75m.

County:  The County does not have authority over power line routes beyond its approval of the traffic safety features in the right-of-way.  

9. In instances where it makes sense to piggy-back with MVEc lines, what are the costs for MVEC and Xcel?  How can the city/county/Xcel/MVEC/ and residents be creative to absorb this cost?  (**According to Laurie Hokkanen, the Plan B route wouldn't have any need or benefit for shared lines.)  

City:  Xcel and MVEC have both stated that piggy-backing the lines on 86th Street presents a safety and reliability concern.  The City consulted with an outside electric operator on 6/23/16 and confirmed the statements that Xcel and MVEC have made regarding the inability to combine different voltages on one set of poles. Additionally, City, Xcel, and MVEC reps met on 6/24/16 to further discuss.  If co-location were possible, the poles would be a minimum of five feet higher, wider, additional poles would be needed to reduce spacing, and the costs would be approximately the same as undergrounding.

County:  The County does not play a role on the co-location of power lines and the optional costs, nor can it speak to the technical possibility of co-locating the lines. The County cannot contribute to the cost of such co-locations.  

Additional Questions Answered by Xcel Energy, posted on August 16, 2016 

1. Can you tell us more about known future needs/plans?

Xcel: Based on what we know today, we anticipate that a second transformer in the new substation may be installed in approximately the 10-20 year timeframe.  The second transformer will fit within the existing footprint of the substation.  Another feeder may be installed at that same time, but most likely at a later date. 

2. What is the process for determining the underground route?

Xcel: Our project designer will be looking for the shortest, uncontested route which likely will be the most cost effective route possible.

3. You indicated to City staff that the CR 11 to Hwy 5 route was approximately $150,000 more expensive than the CR 18 route.  Can you confirm and elaborate on that?

Xcel: The overhead route from CR11 to CR13 along Highway 5 is approximately $150,000 more to construct overhead as compared to overhead along CR18.  This is because it is a longer route and we would need to replace the existing poles with taller poles.

4. Will this project have any positive impact on the lines that are presently on Hwy 5?  Will transformers or lines be able to consolidated/removed?

Xcel: At the end of this project we will be removing the step down transformers and regulators west of CR13 on Hwy 5. 

5. Can you share any studies that document the increased maintenance issues with underground lines?  Can you tell us more about the types of problems you experience with underground lines?

Xcel: Overhead construction is the industry standard across the country.  The cost difference to maintain an underground system is reflected in our Customer Charge where customers served by underground facilities pay a higher amount than those served by overhead facilities.  We did note at the public meeting that underground faults are more difficult to locate and in the winter and take more time to repair due to frozen conditions and inclement weather.

6. Can you share any studies that document/substantiate the cost differential between overhead and underground line construction?

Xcel: We do not have any formal studies that document these cost differences.  Our experience, and that of the industry, shows that underground facilities cost three times more than overhead to install.  The components of an underground system are more expensive than those of an overhead system.

7. Are there instances where Xcel and MVEC do share facilities / the grid? (follow-up question from July 1 questions)

Xcel: This type of information is not available to the public for security reasons.

8. Please tell us more about how / provide us examples of how the costs that the City will pay will be documented and what tools we will have in terms of verification/oversight? 

Xcel: Our design staff will provide the approximate costs for labor, material, equipment and vehicles on an ongoing basis.  Once the project is complete, the unused and salvaged material will get credited back to the project.  We will provide a final actual cost at the end of the project.  

Understanding Right-of-Way
Residents can use the Carver County GIS system to better understand where the Right-of-Way exists.