South Dakota
Reversal of US energy agenda sparks friction between states
Changes to climate policy under President Donald Trump’s administration have sharpened Upper Midwest debates about the reliability of renewable energy and the separation of state and federal interests.
One point of agreement is that winning the White House means controlling the Environmental Protection Agency (EPA), a federal regulatory body that maintains and enforces environmental laws.
Lee Zeldin, Trump’s pick to run the EPA, has announced plans to dramatically reduce staff and reverse policies from the Joe Biden administration involving the oversight of coal-fired power plants, oil and gas development and water quality standards.
The deregulation is of keen interest to energy officials in Republican-led South Dakota and heavily Democratic Minnesota, where differences in climate policy have sparked border clashes over how pushing clean energy to reduce carbon emissions impacts the electrical grid.
The Minnesota Legislature passed a law in 2023 requiring all electric utilities in the state to produce only carbon-free energy by 2040 using sources like solar, wind, hydroelectric and nuclear power.
That law was an offshoot of Biden administration EPA rules requiring coal plants operating beyond 2039 to reduce greenhouse gas emissions by 90% by 2032, which critics saw as shutting down the industry.
Zeldin’s agency has rolled back those rules, inspired by Trump’s March 17 declaration on social media that he is “authorizing my Administration to immediately begin producing Energy with BEAUTIFUL, CLEAN COAL.”
Erin Woodiel / Argus Leader
Chris Nelson, a Republican member of the South Dakota Public Utilities Commission, said reversing coal plant regulations is good news for South Dakota and other states focused on the sustainability of the electricity grid and avoiding blackouts.
“The math didn’t add up with those greenhouse gas limitation rules,” Nelson told News Watch. “They simply could not replace all of those plants quickly enough (with other energy sources) to maintain reliability of the grid. So the Trump administration rolling back those particularly damaging rules was very helpful.”
Xcel Energy to retire coal plants by 2030
Not everyone shares that opinion.
The EPA’s actions face court challenges as clean-energy groups navigate federal and state environmental laws in a changing legal landscape.
The U.S. Supreme Court last year struck down the landmark 1984 Chevron “deference” doctrine, which required courts to defer to reasonable agency interpretations of ambiguous statutes.
Those interpretations are now up to the courts to decide. Democratic-leaning states are forging ahead with climate-based policies regardless of EPA rollbacks, using utility regulation as a tool to keep energy companies in line.
Minneapolis-based Xcel Energy, whose 3.7 million electrical customers include about 100,000 South Dakotans, is sticking with a plan to retire its coal-fired power plants by 2030 as part of an integrated resource plan approved by the Minnesota Public Utilities Commission in February in accordance with state law.
The plan includes replacing coal with “wind, solar and storage solutions” while also building a new natural gas plant in 2028 as a way to address capacity needs.
Natural gas, which replaced coal as the nation’s largest energy source in 2016, emits about half as much carbon dioxide as coal, according to the U.S. Energy Information Administration.
SD 9th in energy consumption per capita
The Xcel announcement came despite criticism from the South Dakota PUC, which questioned the company’s ability to pivot from fossil fuels at that pace without compromising reliability and affordability for customers.
South Dakota ranks ninth among U.S. states in energy consumption per capita, with 34% of households using electricity to heat their homes during frequently harsh winters. Nearly half (48%) use natural gas, with propane at 14%.
The PUC’s concerns were laid out in a 2024 letter to Xcel signed by Republican commissioners Nelson, Gary Hanson and Kristie Fiegen.
“Evidence is mounting that the premature closures … will elevate the risk of electricity outages particularly in tight load hours, including hours of extreme cold and extreme heat, as well as those hours when wind generation is low,” the letter stated. “These events are likely to pose a threat to life and property.”
‘We’re the tail trying the wag the dog’
Xcel’s decision to close coal plants despite South Dakota PUC warnings shows the challenge of trying to influence policy involving companies under the sway of different state laws and consumer interests.
“One of the difficulties we have is that South Dakota represents 5% to 6% of Xcel’s entire system,” said Nelson. “We are literally the tail trying to wag the dog on some of these decisions.”
Some utility companies are advocating a more measured pace on clean energy. Minnesota’s PUC clashed with Otter Tail Power over its decision to amend its long-range plan to push back closures of coal plants – including Big Stone near Milbank, in northeast South Dakota – until at least 2040.
The Minnesota PUC approved Otter Tail’s resource plan last summer after concessions that included the company no longer using its North Dakota-based Coyote Station plant for Minnesota customers beyond 2031.
Will wind energy policy hurt South Dakota?
Despite leaning on fossil fuels to keep the lights on in extreme conditions, South Dakota has harnessed the state’s wind power as an alternative energy source.
In 2023, South Dakota’s wind energy production accounted for more than half (55%) of the state’s in-state net power generation, a larger share than in all other states except Iowa, according to the U.S. Energy Information Administration.
The state’s other primary power sources include hydroelectric (21%), natural gas (14%) and coal (9%). Solar was less than 1% of the power generated (0.3%).
(Photo: Argus Leader)
Increased wind energy production nationally runs counter to the direction of the EPA and Trump, who has criticized the efficiency of turbines and told supporters that “we’re not going to do the wind thing” at a rally shortly after taking office.
So far, the administration’s actions are aimed at offshore wind development, which rely on access to federal waters. It’s not clear how the EPA’s actions will impact South Dakota’s 24 active wind farms, which provide tax revenue and job creation for local communities.
“The actions that we’ve seen the administration take thus far as it relates to wind have been exclusively related to offshore wind projects,” said Nelson. “We’ve not seen any indication that there’s going to be any activity for turbines that might be located in South Dakota.”
— The Associated Press contributed to this story, which was produced by South Dakota News Watch.
Enter your email and we’ll send a secure one-click link to sign in.
KELOLAND.com is provided by Nexstar Media Inc., and uses the My Nexstar sign-in, which works across our media network.
Learn more at nexstar.tv/privacy-policy.
KELOLAND.com is provided by Nexstar Media Inc., and uses the My Nexstar sign-in, which works across our media network.
Nexstar Media Inc. is a leading, diversified media company that produces and distributes engaging local and national news, sports, and entertainment content across its television and digital platforms. The My Nexstar sign-in works across the Nexstar network—including The CW, NewsNation, The Hill, and more. Learn more at nexstar.tv/privacy-policy.
The existing water treatment plant for the Minnehaha Community Water Corp. on June 9, 2026, south of Dell Rapids, S.D. (Photo: Bart Pfankuch / South Dakota News Watch)
DELL RAPIDS, S.D. – Scott Buss can only imagine what this town north of Sioux Falls might have looked like – and how many jobs and taxes would have been generated – if there wasn’t a local shortage of available water.
Buss, executive director of the Minnehaha Community Water Corp., sat in the conference room of the rural water system based in Dell Rapids recently and ticked off the industrial and agricultural projects turned away due to a lack of water.
After hitting its limit on how much water it can provide a few years ago, the rural system has had to turn away proposed projects valued at hundreds of millions of dollars that offered an untold number of new jobs, he said.
The rejected projects include the Agropur Cheese plant that eventually opened in Lake Norden. A few proposed hog farms and dairy expansions in northern Minnehaha County were also stalled, Buss said.
Get South Dakota news and information in a free email on weekdays. Cancel any time.
Subscribe
Other proposals, most of which never came to fruition in South Dakota, included the $1.5 billion Gevo corn-based jet fuel plant, the $5oo million Wholestone Farms hog processing plant and a data center that at some point all eyed the Dell Rapids area for development.
“All the water rights are spoken for between Dell Rapids and Sioux Falls, so there was no more water to be had in Minnehaha County,” Buss told News Watch in an interview in June. “With all the (residential) development that was coming in, we realized that our well capacity and our treatment capacity was limiting our ability to take on new high water-use customers.”
Buss and the nonprofit corporation’s board of directors aren’t waiting around to potentially miss out on more opportunities.
In a unique arrangement, the corporation is partnering with the neighboring Big Sioux Community Water System to the north on a $170 million expansion project called Shared Resources. The expansion, started three years ago, will use new wells into the Big Sioux Aquifer to generate 8 million gallons of water more per day starting this fall.
“It’s going to be a huge and great benefit for Big Sioux and Minnehaha water,” said Jodi Johanson, director of the Big Sioux system based in Egan. “This project is going to make sure that down the road we have enough water for the future.”
2 systems get stronger together
The Minnehaha water corporation is still able to bring on new residential and retail customers who consume part of the 9.2 million gallons of treated water it can provide on a daily basis.
The system was formed by a group of farmers and landowners in the 1970s but sought a reliable way of providing more and cleaner water to residents of Minnehaha County outside of Sioux Falls who relied exclusively on individual wells. The system started with about 1,200 customers but has grown to more than 5,500 now in seven cities, mostly north of the Sioux Falls metro area.
Given the limits on water from the aquifer, and balancing the water needs of consistent housing and retail growth in northern Minnehaha County, the water system had to say no to developments that request 1 million or more gallons of water per day, Buss said. A million gallons per day is equivalent to the water consumption of about 4,300 homes, he said.
Billions needed to keep South Dakota taps flowing
South Dakota water systems will increasingly turn to the Missouri River to provide water for future population, agricultural and industrial growth. But plans will require billions of dollars and decades of construction to keep taps flowing freely.
As with other rural water systems in South Dakota, the aquifers the systems rely on for their water are either running low or are legally tapped out, or both.
In the case of Minnehaha water corporation, the Big Sioux River Aquifer has gotten drier, but state law is also preventing it from taking more water from the aquifer.
In 1996, the state Water Management Board allocated water rights, or withdrawal limits, to systems that take groundwater from the aquifer, Buss said.
Those limits have now been reached, meaning that Minnehaha water cannot take any more than the 7 million gallons per day it is drawing now.
The system also receives about 2 million gallons per day from the Lewis & Clark Regional Water System, making its daily maximum capacity of about 9.2 million gallons per day, which it sometimes reaches, especially during spring planting season or hot summer months.
Directly to the north, the Big Sioux Community Water System produces up to 2 million gallons per day for about 2,400 customers in Moody and Lake counties as well as some in Brookings County and in western Minnesota, Johanson said.
The system still has room within its water rights to draw more water, making it an attractive partner for Minnehaha water.
Though Big Sioux Community Water System has not turned away any large projects, it needs more water to serve a boom in residential growth in the region, Johanson said.
In the area around Lake Madison, near Madison, developers are considering projects that could someday bring 500 new homes and a new nine-hole golf course, she said.
Support solutions-focused storytelling. Help South Dakota News Watch tell stories that identify and share solutions to the state’s biggest challenges.
Donate
The system also serves a number of dairies that use significant water and provides water to the Dakota Ethanol plant in Wentworth, which is undergoing an expansion. Farmers in the region are also using greater quantities of water to deliver chemicals onto their land, Johanson said.
“This is our first expansion,” she said. “We’re looking forward and we’re trying to find the solution before we face a problem.”
Federal government and customers pay the way
The biggest Shared Resources ticket item is a new $80 million water treatment plant that is nearly completed on 240th Street a few miles north of Dell Rapids.
A 20-inch pipeline from the plant to the east will end at a 1.5 million gallon water tower, and a 24-inch pipeline to the west will terminate at a ground-level storage tank with a 4 million gallon capacity.
Six new wells will draw the water, and the storage tanks will provide both pressure and the ability to adapt to changing demands without service interruption, Buss said.
As with most modern water projects, the costs will be shared by government and end users. The systems are funding the project with $49 million in grants from the Biden-era American Rescue Plan Act and $121 million in low-interest loans from South Dakota’s Drinking Water State Revolving Fund.
The two systems are sharing the cost of the project loans commensurate with how much water they will receive, meaning Minnehaha will pay 65% of the costs for its 5 million gallons per day while Big Sioux will kick in 35% for its 3 million gallons more per day.
Minnehaha water is assuming $87 million in new debt and Big Sioux will take on $42 million in new debt, Buss said.
The average residential consumer in both systems that uses about 7,000 gallons per month will see their bill rise to $135 a month, roughly double the cost in 2020.
“It’s a big project, and it’s a good example of how two systems can work together to have some economies of scale,” Buss said.
Ratepayers will see a significant increase in their monthly water bills. The average residential consumer in both systems that uses about 7,000 gallons per month will see their bill rise to $135 a month, roughly double the cost in 2020, Buss said.
A big project, but even more water needed
But both systems view the Shared Resources project as a temporary fix and both are looking toward proposed projects that will tap the Missouri River for more water in the future.
Buss said his system has applied for 10 million gallons more water per day from Lewis & Clark, which has two expansion efforts planned.
Minnehaha water has simultaneously applied to receive 10 million gallons per day from the proposed Dakota Mainstem Regional Water System, a potentially $10 billion project to carry Missouri River water to more than 50 communities and organizations across eastern South Dakota and parts of Minnesota and Iowa.
The dual application effort is to make sure Minnehaha water can rely on taking in more water from at least one of the two systems as they come online, Buss said.
Johanson said Big Sioux has also signed on to accept water from Dakota Mainstem, even if it takes 20 to 40 years for the water to begin flowing.
To ensure that steady supply of high-quality drinking water, four major projects are in progress to take more water from the Missouri River – including WEB Water in the northeast, Lewis & Clark and the proposed Dakota Mainstem in the southeast as well as the proposed Western Dakota Regional Water System in western South Dakota and the Black Hills.
The projects are part of a wide-scale increase in water service capacity now underway in South Dakota, where water managers of several systems are implementing plans to serve the state for the next 40 to 50 years.
Regional rural water systems such as Minnehaha and Big Sioux are critical components of those projects because they provide water to communities and individual customers at the end of the delivery system.
Alicia Deschepper, zoning administrator for Moody County, said the water system expansions should allow for more growth to occur in Moody and Minnehaha counties, which are seeing new single-family housing developed at a rapid rate.
“I think it will be a great thing for our county and hopefully enable us to bring in more bigger businesses as well as more homes,” Deschepper said.
South Dakota News Watch is an independent nonprofit. Read, donate and subscribe for free at sdnewswatch.org. Contact content director Bart Pfankuch: 605-937-9398/bart.pfankuch@sdnewswatch.org.
SIOUX FALLS, S.D. (Dakota News Now) – The South Dakota Department of Public Safety said a nine-year-old girl from Waterloo, Iowa, is dead following a fatal Hughes County crash on Saturday.
This crash happened on Saturday, July 4, near the Spring Creek Recreation Area about 15 miles northwest of Pierre.
Preliminary crash information suggests a utility vehicle driven by a 37-year-old Iowa man was driving south on Spring Creek Drive. He attempted to turn around and rolled the vehicle.
A 16-year-old boy was also in the vehicle and was hurt, while the driver was not hurt.
The South Dakota Highway Patrol is investigating the crash.
Copyright 2026 Dakota News Now. All rights reserved.
-
West Virginia3 minutes ago11 Marshall student athletes suing NCAA over new rule – WV MetroNews
-
Wyoming10 minutes agoElection Q&A: Qwenton Eagle Oviatt for Wyoming secretary of state
-
Crypto13 minutes agoAn Easy-to-Miss Radio Traffic Jam Is Behind Many Home WiFi Slowdowns
-
Finance18 minutes agoFayette County Public Schools Board of Education approves audit contract, new finance director position
-
Fitness25 minutes agoCaroline Idiens and Jenni Falconer’s time-efficient 9-exercise workout builds full-body strength in 30 minutes
-
Movie Reviews33 minutes agoFilm reviews: ‘The Invite’ and ‘Minions & Monsters’
-
World43 minutes agoFeds Detail Hoopster Kerr Kriisa’s Alleged $2.2M Criminal Side Hustle
-
Politics55 minutes ago
Preliminary Hearing for Man Accused of Killing Charlie Kirk Starts in Utah
