Minnesota Bill HF700 Considers Bold Carbon-Free Energy Target

Last week Minnesota Representative Jamie Long (DFL – Minneapolis) introduced HF700, a bill laying out a bold plan to achieve 100 percent carbon-free energy for the state.  Last Tuesday an informational hearing was held in the House Energy and Climate Finance and Policy Division, where dozens of Minnesotans testified in support of the bill. They stressed the need for Minnesota to be a national leader on clean energy, and the dire consequences of waiting to act on climate change.

In 2007, Minnesota passed the Next Generation Energy Act which set a 25 percent Renewable Energy Standard (RES) by 2025 (30% for Xcel Energy), and set a carbon reduction goal of 80 percent by 2050. Minnesota has met its RES goal 7 years ahead of schedule, but the state is not on track to meet its carbon reduction goal.

So, what’s in HF700, and what would its passage mean for Minnesota?

What’s in the bill

HF700 calls for electric utilities in that state to get 55 percent of their power from renewable sources by 2030, 80 percent by 2035, and to go 100 percent carbon-free by 2050.  The state’s largest investor owned utility, Xcel Energy, has a higher standard to meet of 55 percent renewable energy by 2026, 60 percent by 2030, 85 percent by 2035, and 100 percent carbon-free by 2045.

The bill adds a definition of carbon-free to the RES, defined as a technology that generates electricity without emitting carbon. However, it doesn’t state which specific technologies would qualify as carbon free, such as nuclear energy or Carbon Capture and Storage (CCS). This is relevant because two of Minnesota’s nuclear plants, owned by Xcel Energy, have operating licenses set to expire in the 2030s.

The bill removes trash incineration from the definition of renewable energy sources and incorporates environmental costs as a factor that the Minnesota Public Utilities Commission (PUC) must consider if a delay in meeting these benchmarks is requested by a utility. The bill also directs the PUC that in evaluating a utility’s claims of transmission capacity constraints, it must consider whether the utility has taken all reasonable measures to meet the requirements with renewables.

The legislation also includes an expanded section on local benefits, including important equity considerations like directing the PUC to ensure equitable implementation in the following areas:

• The creation of high-quality jobs in Minnesota paying wages that support families;
• Recognition of the rights of workers to organize and unionize;
• Ensuring that workers have the necessary tools, opportunities and economic assistance to adapt successfully during the energy transition, particularly in communities that host retiring power plants and contain historically marginalized and underrepresented populations;
• Ensuring that all share the benefits of clean and renewable energy and the opportunity to participate fully in the clean energy economy;
• Ensuring that air emissions are reduced in communities historically burdened by pollution and the impacts of climate change; and
• The provision of affordable electric service to Minnesotans, particularly to low-income consumers.

 Alignment with Xcel’s recent commitments

This bill fits nicely with what Xcel has already committed to and allows the company a lot of flexibility in achieving their long-term goals.

In December Minnesota’s largest investor owned utility Xcel Energy announced their commitment to 100% carbon-free electricity by 2050. Within their plan Xcel has also set the near-term goal of 80% reductions by 2030.

With existing technologies such as wind, solar and energy efficiency, Xcel will be able to achieve their near-term goal.  Additionally, energy storage costs are expected to continue to decrease, which will allow for even more renewable energy penetration. Their long-term goal will be harder to achieve and, in their words, will require technologies that are not currently cost effective and commercially available today.  However, they are committed to ongoing work to develop advanced technologies while putting the necessary policies in place to achieve this transition.

My colleague gives a variety of potential pathways for how they’ll be able to get all the way to zero, including unlocking the full potential of dispatchable renewables, energy efficiency, flexible demand, energy storage, and other technologies such as carbon capture and sequestration.

Learning from our friends to the west

California passed a similar bill in 2018, setting a bold goal of 100 percent carbon-free electricity by 2045 and increased the renewable energy standard from 50 to 60 percent by 2030. UCS developed 10 key strategies that state policymakers and stakeholders could follow to achieve these goals and make the electricity grid more flexible while reducing fossil fuels.

Minnesota could benefit from implementing similar strategies. The  key strategies to achieve 100 percent carbon-free electricity include:

• Using electricity as efficiently as possible to reduce peak demand;
• Generate renewable energy from a diverse mix of resources;
• Plan for an equitable transition away from fossil fuels, including natural gas;
• Use renewables to provide grid reliability services;
• Invest in energy storage;
• Unlock the value of distributed energy resources;
• Electrify cars, trucks, and buildings;
• Shift electricity demand to better coincide with renewable energy production; and
• Promote high-quality jobs and workforce development.

What’s Next?

HF700, and the Senate companion bill SF850, are a powerful move in the right direction for Minnesota. UCS will be working with our coalition partners to push the state’s utilities to look at all their options and make sure that cost-effective measures, like energy efficiency, are used in the path to 100 percent.

The Senate version awaits action by the Senate Energy and Utilities Finance and Policy Committee.  The bill may face an uphill fight in the Senate, but a hearing would be a great first step. Now is the time for us to move toward with 100% carbon-free and equitable energy that benefits all Minnesotans.