Minneapolis' Sabathani center needs $10M from state to make HVAC system climate-friendly

Thelma & Louise are saying good-bye to Sabathani Community Center.

The twin gas boilers that heat the nearly 100-year-old building are on their last legs, and the center and its backers are hoping the DFL-controlled Legislature will help pay for a more climate-friendly replacement.

Sabathani is hoping to replace the boilers with a $21 million geothermal heat pump system, but it needs help with the funding.

"Our goal is to push Thelma & Louise over the cliff," Sabathani CEO Scott Redd said during a state Senate committee hearing in late February. "Each year we spend $27,000 on maintenance and pray that the boilers will survive another winter."

Redd and Sabathani supporters are hoping to get $10 million for the project from the Legislature this year, even though state lawmakers are unlikely to fund much more after passing massive energy spending in 2023. Center leaders failed to get state money last year, but two hearings early this legislative session signal the bill could be one of the few energy initiatives to get legislative cash.

Though there is no bubbling volcanic activity below Sabathani like the kind that fuels widespread geothermal use in Iceland, the large community center that hosts a food shelf, advocacy work and events is nevertheless a potential location for subterranean heating and cooling that could slash carbon emissions and help clean energy job training efforts.

The bid for the heat pump system comes while Xcel Energy and the city of Minneapolis are separately working to make Sabathani one of three sites in the "Resilient Minneapolis" project by installing battery systems to operate independently from the power grid and serve as backup power sources and emergency sites during outages.

Redd's $10 million request has raised eyebrows among Republican lawmakers. In a bill sponsored in the Senate by Sen. Tou Xiong, DFL-Maplewood, and in the House by Rep. Athena Hollins, DFL-St. Paul, the money would come indirectly from Xcel and its customers rather than taxpayer dollars.

It would be sourced from fees the Minneapolis-based utility pays to the state for storing nuclear waste at its Monticello and Prairie Island plants. That money, which is paid by Xcel customers, is used by lawmakers for clean energy initiatives.

Redd said the plan for a geothermal heat pump system at the 188,000-square-foot building came from an engineering study that looked at 12 different potential systems to replace the gas boilers. The project qualifies for tax breaks and Sabathani is looking for other funds as well, including by applying for a federal grant.

But, for Sabathani, the venture is not only about having a heating operation that makes economic sense.

Redd said the new system would reduce gas costs by $61,000 a year and be cheap to run and maintain. It could serve a 72-unit multifamily housing project planned at the site. It also would help a clean energy job training program.

Geothermal would also reduce emissions from the building in an area with high asthma rates, another draw for an organization with a desire to take environmental justice measures and to address climate change.

"We care and we want to make a difference and this is our way of doing that," Redd said, during a tour last week.

Brown said Sabathani would likely install a backup gas boiler for the coldest days from CenterPoint Energy as part of a gas innovation law.

GOP lawmakers wondered if the request was too much for an organization of Sabathani's size, or if it should be some kind of loan rather than a grant.

Rep. Pat Garofalo, R-Farmington, said in a House hearing last week the project would eat up much of the available money in the Xcel nuclear waste fund.

"This is a real cost to ratepayers," Garofalo said. "Ratepayers are paying a higher cost on their electric (bill) for projects like this."

Hollins said it was a large ask, but she also said it's small organizations like Sabathani that need the state help. Xcel supports the proposal as well.

"When we're talking about communities that are really working with disadvantaged individuals and historically unrepresented individuals, it makes a lot of sense that we as a state and entities like Xcel can come together and help to support them," Hollins said.