Duluth’s culture is ingrained with environmental stewardship, with a backbone of industry and tourism that make it a keystone Minnesota city. These values drove the City of Duluth to partner with Ever-Green Energy to develop a vision for Duluth Energy Systems that can deliver system improvements and carbon reductions to benefit the customer base and the community. For this municipal district energy system, the critical components of that vision are a transition away from steam distribution to more efficient and cost-effective hot water; a transition from coal to renewable energy; and partnering with the City of Duluth to promote the potential of its unique asset.

Updating a First Generation Energy System

Duluth Energy Systems is a first generation district energy system, built in the 1930s with once-through steam distribution that limited its efficiency and renewable potential. When Ever-Green stepped in as the operations manager for the City in 2012, we faced the realities of that initial approach and the common problem of deferred system maintenance. Bringing expertise honed over decades of revitalizing and advancing its nationally-renowned system, District Energy St. Paul, the Ever-Green team started our journey as operator by performing a thorough audit of existing equipment and processes. With an imperative to transform aging infrastructure while maintaining cost-effectiveness for customers, the Ever-Green team completed a comprehensive plan in 2013 to modernize the system.

In stride with the City of Duluth, we created a joint vision for the plant’s transformation:

In production: Investment in plant and production updates to improve efficiency and reliability. Integrate fuels with a lower carbon footprint.

In distribution: Replace steam with more efficient hot water.

In the community: Reconnect Duluth Energy Systems as a partner to local business and an environmental steward.

For the future: Grow the system, delivering value to new customers every year.

More Renewable Energy, Less Carbon

It is a goal at Ever-Green to implement sustainable and innovative technologies. Until 2016, the Duluth plant ran primarily on coal. In 2017, through a cooperative effort between Duluth Energy Systems and the City’s natural gas utility, Comfort Systems, the plant has added natural gas to the fuel mix. In 2019, we plan to begin using renewable fuel oil (RFO) made from sustainable forest residuals. RFO is a growing renewable solution in North America, helping utilities transition away from fossil fuels by offering an easily integrated renewable alternative. The renewable composition of the fuel oil qualifies it for a federal credit that makes it cost-effective. This means customers get the benefit of carbon reductions without negatively impacting their rates. These upgrades will reduce the system’s carbon emissions by over 60 percent.

Being the Best Option for Our Customers

As a service provider to local business owners, our key focus is on effective solutions that will be both reliable and cost-effective for our customers. In Duluth, this means transitioning away from a once-through steam system that took 40-degree water from Lake Superior and heated it to make 360-degree high-pressure steam. The steam was delivered to buildings where some of the leftover steam, or condensate, returned to the waste treatment facility for processing. The new system solution is hot water distribution, which is a closed loop circulating 160-215 degree water to customers that is returned back to the plant to be reheated after heating customer buildings. The closed loop approach saves water, wastewater processing, energy, and money. “Systems across North America are contemplating these types of transitions with a focus on renewable integration and distribution efficiency. The transformation in Duluth has been ahead of schedule and is an incredible testament to the local leadership and our operations team,” says Ever-Green CEO Ken Smith.

Given the importance of modern energy infrastructure and the fortunate timing of the Superior Street construction project, the City was able to secure additional funding support from the State of Minnesota to catalyze the modernization project. The investment enables this phase of the distribution overhaul to capture cost savings from concurrent construction with the 16-block stretch of street work that began in 2018. These savings and the state investment were crucial to the project’s success and allowing the system to keep rates stable through the transition.

Another marker of progress at Duluth Energy Systems is our agreement to expand service to the City’s medical district. Essentia Health’s entire campus will be served by the district energy system. Essentia will also serve as a backup energy provider to Duluth Energy Systems, providing added production redundancy for Duluth Energy Systems and the customer. We are also working with St. Luke’s on their upcoming expansion. The partnership between these major customers, the City of Duluth, and Duluth Energy Systems will allow the system to continue its mission well into the future. As these campuses evolve, new opportunities for increased hot water service and other technology upgrades will manifest.

Public-Private Partnership

None of this progress would have been possible without the strong public-private partnership between the City of Duluth and Ever-Green Energy. “A key partner in this progress is Duluth Mayor, Emily Larson. Throughout this process, Mayor Larson has been a staunch advocate for development and transformation that will benefit the City of Duluth and its residents, business owners, patients, and patrons,” says Ever-Green Energy CEO Ken Smith. The success of this transformation has also been predicated on other regional leadership and stakeholders, including Duluth’s incredible state leadership, the Duluth Area Chamber of Commerce, the Greater Downtown Council, and Ecolibrium3. Ecolibrium3’s Executive Director, Jodi Slick, has been a stalwart champion of this work, as an advocate for clean energy and efficiency and a long-standing member of the Duluth Energy Systems System Advisory Board. It is clear that partnerships are making all of the difference in driving change for this system.

The incredible metamorphosis of Duluth Energy Systems speaks not only to the strong cohort of partners, but it also credits them with a steadfast commitment to providing reliable, cost-competitive, environmentally responsible energy to the Duluth community. In the year ahead, we look forward to integrating renewable fuel oil, expanding our services to new customers, and continuing to provide the most innovative and competitive option for those we serve.