By Minnesota Public Radio News

The cost of electricity is up sharply for many rural Minnesota customers, and one of the reasons is that utilities are losing money on electricity generated from wind.

Prodded by the state’s renewable energy standard, utilities have signed contracts to purchase electricity from wind farms. But because wind sometimes generates more electricity than those utilities need, they are forced to sell on the open market, which in a slow economy like this, is a money-losing proposition.

The circumstance hits rural providers harder than others because costs are typically spread over less dense service areas, utility officials say.

Grand Forks-based Minnkota Power Cooperative, which typically sells to rural electric cooperatives across northwestern Minnesota and eastern North Dakota, is a case in point. Although the Minnesota standard says utilities have to get 25 percent of their power from renewable sources by 2025, Minnkota is ahead of the game. It already gets 35 percent of its electricity from wind.

But when the wind is generating more than it can use, it sells on the open market, and there are few buyers, said Dave Loer, Minnkota president and chief executive officer.

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