MINNEAPOLIS — A federal appeals court sided with North Dakota interests on Wednesday in affirming a lower court ruling that bars Minnesota from enforcing key sections of its 2007 law restricting new power generation from coal.

A three-judge panel of the 8th U.S. Circuit Court of Appeals ruled that Minnesota’s Next Generation Energy Act illegally regulates out-of-state utilities.

Minnesota’s law was meant to reduce statewide carbon dioxide emissions from the power sector by prohibiting utilities from meeting Minnesota demand with coal power generated by big new facilities outside the state.

The state of North Dakota, three electrical cooperatives based in the Dakotas that also serve customers in Minnesota, and other entities challenged the law, saying it violated the commerce clause of the U.S. Constitution, which gives Congress power to regulate interstate commerce.

The appeals panel agreed that practical effect of the state’s prohibitions would have prevented out-of-state utilities from adding coal-power capacity to the regional power grid without approval from Minnesota regulators.