Xcel Energy announced that it is setting up a new biomass-fueled power plant in Ashland, Wisconsin. Rather than build from scratch, the company will convert an existing in plant in that location to run completely off of biomass. Once the project is complete, the plant will be the largest of its type in the Midwest,  using wood waste to produce enough electricity to power 40,000 homes. Xcel is planning to spend $55 million to $70 million to complete the plant, and construction is expected to take 2 years starting in 2010.

The new plant will help Xcel achieve its environmental goal of reducing carbon dioxide output by 22%.

Dick Kelly, Xcel’s president and CEO, commented on the project:

"The Bay Front project reflects our increased focus on environmental leadership and designing a clean energy future for our customers and communities. As part of this effort, we are investing in advanced energy technologies and improving the environmental performance of our existing generating resources. These efforts combined contribute to our goal to reduce carbon dioxide by 22 percent from 2005 levels on our Midwest generation system by 2020.”