Xcel Energy has proposed a large-scale distributed battery storage network across Minnesota to address rising electricity demand and improve grid efficiency. Under its Capacity*Connect proposal, the company plans to install up to 200 MW of battery storage at selected sites by 2028 in partnership with Sparkfund. The storage systems will be integrated into the state’s power network to improve utilisation of existing infrastructure and ensure reliable service for customers.
The distributed storage units will be installed at commercial, industrial, and nonprofit locations across the state. Each site will host between 1-3 MW of capacity, with participating hosts receiving payments for participating in the initiative. This would financially benefit the customers, including those from environmental justice communities. Additionally, the company’s integrated system planning process will help determine the most effective installation sites. The batteries will be charged when electricity prices are low and discharged during high-demand periods to stabilise the grid.
Furthermore, the proposal forms part of Xcel Energy’s Upper Midwest Energy Plan, which targets the addition of 600 MW of energy storage by 2030. The Upper Midwest Energy Plan was approved by the Minnesota Public Utilities Commission in February 2025. It includes major investments in battery storage, wind, and solar projects, along with a new natural gas plant and extended operational life of two carbon-free nuclear plants, targeting carbon emission reductions of over 80 per cent from 2005 levels by 2030, potentially reaching up to 88 per cent.