Regulators Want Answers On Lake Norden Incentives

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KELO Lake Norden South Dakota map

Otter Tail Power wants to give a big break for a huge expansion at the cheese plant Agropur owns at Lake Norden.  But South Dakota’s Public Utilities Commission members wondered Tuesday whether the break was too big.

The commissioners delayed a decision so the two companies could work on answers.

“I feel like we’re still missing pieces of the puzzle today,” Chairwoman Kristie Fiegen said.

Agropur, a Wisconsin-based cheese company, would get as much as $640,000 total in incentives over three years from the Fergus Falls, Minnesota-based utility.

The money would help pay for equipment to reduce Agropur’s need for electricity, as it triples the Lake Norden plant’s size.

Other Otter Tail customers could see slightly higher bills to pay for it.

Agropur could receive as much as $750,000 of incentives from Otter Tail, if the cheese-maker finds more ways to save electricity.

David Bero is Agropur’s energy manager. He told the commissioners the expansion costs about $250 million and would add about 220 jobs.

Commissioner Chris Nelson said the company would save enough on electricity in two years to cover the $2.7 million cost for more efficient equipment and processes.

Bero said Agropur planned to break even on those changes in three to four years.

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