Groundwork for growth: Utility companies make major investments in Lincoln, Minnehaha counties

Feb. 13, 2019

This paid piece is sponsored by the Minnehaha County and Lincoln County Economic Development Associations.

Growth like Minnehaha and Lincoln counties have experienced in recent years can’t happen without upfront investment.

Before there can be new hotels in Hartford, a busting industrial park in Tea or new schools under construction in Harrisburg, utility infrastructure is needed to allow development to occur.

And in the communities of Minnehaha and Lincoln counties, that investment keeps expanding – a sign that growth likely will too.

Xcel Energy, Southeastern Electric Cooperative, Sioux Valley Energy and the city of Sioux Falls’ light and power division have all made or planned for significant investments in energy over the past five years to meet current and anticipated demand.

Those same utilities help shepherd in continued growth by supporting groups such as the Lincoln County Economic Development Association and Minnehaha County Economic Development Association, as well as individual projects in smaller communities.

“We’re investing in those communities to keep that growth going,” said Todd Nelson of Southeastern, who also serves as LCEDA’s treasurer. “As the area grows, it benefits everyone.”

Keeping up with demand in the southeast part of the state was a large driver for Xcel Energy’s $379 million in investments in its South Dakota service area over the past decade. The utility wants to be prepared for any type of expansion, from new homes to large-scale industrial endeavors.

“We don’t want to be the one holding up a new project in the Sioux Falls area,” said Eric Pauli of Xcel Energy. “When we’re asked, we want to be able to say we’re ready.”

A significant share of Xcel’s investment was in the CapX2020 transmission project, meant to move wind energy from upcoming installations into the utility’s integrated system and to lower prices for all its customers.

Other investments specifically were tied to the Sioux Falls area. A distribution substation near Falls Park was completed in 2015, and another one near Renner was finished in 2016.

The Falls substation will power downtown Sioux Falls well into the future, but both projects benefit the region as a whole, Pauli said.

“Those substations were not built in Lincoln County, but they will offer relief to substations in Lincoln County,” he said.

The most recent energy project of note was celebrated in December in Hartford, when Sioux Valley Energy representatives gathered with local leaders to cut the ribbon on a new transmission substation, replacing one built in 1952.

The new Hartford substation is associated with Sioux Valley’s wholesale power supplier, East River Electric Power Cooperative.

The opening came after an upgrade to the transmission system on the west side of Sioux Falls in 2011 and before a similar project on the east side slated for fall of this year.

Also in the works are overhead line rebuilds east of Colton, southwest of Hartford and at various other locations throughout Minnehaha County, 10 new distribution substations and three new supply substations.

Sioux Valley serves 14,000 homes, businesses and other facilities in Minnehaha County, including in Brandon, Hartford, Humboldt and Colton.

Southeastern completed a new distribution substation of its own last year. The project between Worthing and Canton was built to serve a grain elevator, and there are other substations in the works.

The majority of Southeastern’s Lincoln County members are rural homes, farms and businesses, but the utility also powers homes in Tea, Harrisburg, Lennox and Worthing.

But electric service is only part of a commitment to economic development from area utilities, Nelson said. Southeastern also invests in communities where it doesn’t have customers.

“Just because we don’t service those communities doesn’t mean we don’t support them in other ways,” he said.

Southeastern is a financial supporter of LCEDA and a partner of the Rural Electric Economic Development Fund.

The REED Fund was created in 1996 and is administered through East River Electric. Low- or no-interest loans flow from the fund to small-town nursing homes and volunteer fire departments, housing, small businesses and value-added agriculture projects.

Coordinated efforts to open funding to smaller communities pays off, Nelson said, noting that LCEDA’s outreach since its formation in 1996 has helped integrate a patchwork of development groups, model best practices and otherwise aid areas with fewer resources than a city like Sioux Falls might have.

“At that time (in 1996), there were development groups in communities, but there was nothing regionally,” Nelson said.

Sioux Valley also contributes to the REED Fund and to local and regional development groups such as MCEDA and Forward Sioux Falls. Beyond that, it has a program called Operation Round Up, which allows co-op members to round up their bill to the nearest dollar, with the proceeds going to nonprofit groups. Since 2000, Operation Round Up has given more than $470,000 in grants in Minnehaha County alone.

Sioux Valley also has a program called EmPOWER Youth to train high school students in leadership, personal development, communications, career and civic duty.

“We are committed to helping our local communities grow and thrive. If we can provide assistance to local nonprofits, invest in economic development activities and grow future leaders, all communities benefit,” said Carrie Vugteveen, director of communications and government relations for Sioux Valley.

Xcel is not part of the REED Fund, but it does set aside funds to support community development in South Dakota. The utility puts about $100,000 annually into community investment, Pauli said, a figure that includes contributions to economic development groups. Of that amount, $20,000 is set aside specifically for individual communities, which can apply for help with things like trail improvements and welcome signs.

Pauli is the current president of the Lincoln County Economic Development Association.

Building a small town into an attractive option for a new business is often less about huge investments and incentives than about basic necessities, Pauli said. A business looking to hire a dozen or more employees will want to make sure those employees have access to child care, housing, gas stations, parks and other amenities.

“The biggest thing in many cases is that those smaller communities might not have the resources the larger ones do,” he said. “Organizations like MCEDA and LCEDA can help connect them to some of those resources.”

With plenty of available power and the support of such associations, the utility representatives expect the story of growth to continue for Sioux Falls and the surrounding communities.

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Groundwork for growth: Utility companies make major investments in Lincoln, Minnehaha counties

Here’s a sure sign more growth is ahead for the communities of Lincoln and Minnehaha counties: The utilities that serve them are already building.

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