As session approaches, Minnesota lawmakers plan to keep advancing shift to clean energy

Published 4:26 pm Tuesday, January 9, 2024

By Kirsti Marohn

Minnesota lawmakers passed a range of bills last year aimed at reducing greenhouse gas emissions that contribute to climate change.

This year, with a shorter legislative session and a much smaller budget surplus, expectations are more modest. But some key lawmakers and climate advocates say there’s still work to do.

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Here’s a look at what’s likely ahead.

What were the key elements of last year’s historic clean energy legislation?

The landmark bill was a requirement that Minnesota utilities get 100 percent of their electricity from carbon-free sources by 2040.

Lawmakers also passed a $2 billion environment and energy budget that included incentives for solar panels on schools, money for electric school buses, and grants and rebates for people who want to buy electric vehicles, install electric heat pumps or add panels in their homes so they can switch to electric appliances.

Legislators also created a state competitiveness fund that the state can use to help match money for clean energy from the federal infrastructure law and the Inflation Reduction Act. And they funded the Climate Innovation Finance Authority, often referred to as a “green bank,” to loan money to individuals or groups to develop clean energy projects.

Will there be such ambitious proposals this session?

It’s unlikely. The Legislature passes a budget every two years, and this is a non-budget year. Much of the focus of this session will be on a bonding bill to fund capital improvement projects.

Also, the state’s budget surplus is expected to be considerably smaller than the $17 billion projected a year ago. And state agencies are still working to implement many of the new rules and programs lawmakers passed last year.

“We gave them a lot to do, and they are working their tails off to do it,” said Rep. Patty Acomb, DFL-Minnetonka, who leads the House Climate and Energy Finance and Policy Committee. “I think they need to have some time to catch up.”

It’s not that lawmakers won’t be considering any energy-related legislation, Acomb said — they’re just tempering expectations a bit.

The Minnesota Department of Commerce was tasked with creating more than 30 new programs, including solar in schools, electric vehicle rebates and the state competitiveness fund.

Commissioner Grace Arnold says the agency has hired additional staff and will be launching those programs over the coming weeks and months.

What energy issues might lawmakers take up?

One key issue is making sure Minnesota can achieve its clean energy goals, including the requirement of carbon-free electricity in 15 years.

Justin Fay with the nonprofit group Fresh Energy said his organization is hopes the Legislature will take “a very pragmatic look at what are the barriers that remain to actually getting clean energy projects built, and figuring out how we can simplify or speed those kinds of things up.”

New wind and solar farms and transmission lines can take years to get permitted and built, and sometimes cause conflicts with landowners. Some power companies will have to wait years to get connected to the grid, and even some of those which do get connected complain existing insufficient infrastructure cannot handle the power the new facilities are generating.

Rep. Acomb said lawmakers might look at ways to speed up the approval process while still making sure there is environmental review and public input.

Electricity generation is just one sector of the economy that contributes to climate change. Clean energy advocates want to move the conversation to what Minnesota needs to do more to decarbonize other areas, such as transportation and buildings.

Fay said the bonding bill could be a way the Legislature could help fund those efforts, such as electric vehicle charging networks or district geothermal systems that provide heating and cooling for a whole neighborhood.

“The bonding bill, even though it’s kind of a biennial rite of passage in Minnesota, has probably been underutilized as a climate strategy over the years,” Fay said. “And that’s definitely an area where we’re going to be focusing this year.”

Legislators also might scrutinize the impact of energy costs on Minnesotans’ pocketbooks. Large utilities are seeking rate hikes for electric and natural gas customers, and Xcel Energy has been predicting sharp increases in the cost of its community solar garden program.

Sen. Nick Frentz, chair of the Senate Energy, Utilities, Environment and Climate Committee, said the Legislature should hold informational hearings to look at all of the state’s energy programs, including cost and reliability.

“There’s a growing recognition that in order to make the most successful clean energy transition, we have to be aware of ratepayer impacts, and the No. 1 impact ratepayers see is cost,” said Frentz, DFL-North Mankato. “So the more we make the clean energy transition affordable, the more people will buy electric vehicles, the more people can afford to transition to heat pumps, the more electric panels can be purchased.”

There was debate last year about lifting the state’s moratorium on new nuclear power. Will it come up again?

It’s possible. Last year, the Senate included funding for a study of advanced nuclear technology — smaller, modular reactors that advocates say are safer than the legacy plants built in the 1970s. The provision did not make it into the Legislature’s final budget.

Both committee chairs said they’re open to considering all potential pathways to clean energy, including a study of advanced nuclear. But cost and regulations are prohibiting factors, along with storing radioactive waste.

“Nuclear is a clean, carbon-free technology,” Frentz said. “It has drawbacks and concerns. That means we should look more closely, not that we should refuse to look at it.”

No companies have indicated interest in building a new nuclear plant in Minnesota. Nuclear safety has been in the spotlight in the past year, since a tritium leak at the Monticello nuclear plant owned by Xcel Energy.