Xcel Energy has submitted a proposal to regulators in Minnesota and North Dakota to build three new natural gas power plants in the US states.
One plant is expected to be built in Burnsville, Minnesota, while the other two will be situated near Hankinson, North Dakota.
As per the plans, the first natural gas power plant will be built at the Black Dog plant in Burnsville to replace the facility's coal-fired generating capacity.
The power plant will be able to generate 215MW of electricity and is expected to be completed in 2017.
Xcel Energy plans to add second and third 215MW combustion turbines near Hankinson in 2018 and 2019, if they are needed.
The energy firm said the proposal is in response to proceedings before the Minnesota Public Utilities Commission on its Upper Midwest Resource Plan.
It was concluded at the proceedings that the company will need to add 150MW of new power resources in 2017 and up to another 350MW by 2019.
Xcel's Minnesota region CEO Judy Poferl said: "Our proposal responds to our customers' need for power that can be brought on line quickly and efficiently to meet demand when it's highest."
"Further, our proposal provides flexibility to allow us to add resources only if they're needed."
Poferl added that overall electrical demand is expected to remain flat, but Xcel sees a need for more power generators and new resources to supply customers during peak usage times.
Houston-based power firm Calpine is expected to propose building a new generating unit and selling the output to Xcel under a long-term contract, reports the StarTribune.
The Minnesota Public Utilities Commission will consider and review bids from other power firms to sell peak power to Xcel, instead of allowing the firm to construct its own plants.
Xcel Energy currently serves 1.2 million customers in Minnesota and 90,000 in North Dakota.