Minnesota Likely to Expand Solar Mandate in Its Renewable Energy Laws

A conference committee between the Minnesota State House and Senate recently announced an agreement to resolve differences in two competing proposals to expand the solar energy requirement for investor-owned utilities. Under the proposal, investor-owned utilities (such as Xcel Energy and Minnesota Power) must generate 1.5 percent of its electricity from solar power by 2020.

In 2007, Minnesota passed a renewable portfolio standard (RPS) requiring all utilities in the state to generate 25 percent of its power from renewable sources of energy by 2025. Utilities could utilize solar thermal electric, photovoltaics, landfill gas, wind, biomass, hydroelectric, municipal solid waste, and other emerging technologies to meet the standard. The state also passed a separate standard for Xcel energy requiring it to generate 30 percent of its retail electricity sales with renewable energy by 2020. The language of that particular provision in effect created an RPS where wind made up the vast majority of the mandate (24 percent), with solar being capped at 1 percent, and the remainder could be made up using available eligible  technology like biomass.

The legislation produced by the conference committee changed existing caps on solar and created a carve out within the RPS law requiring all investor-owned utilities to expand solar production while moving up the deadline of compliance by five years. The bills drew criticism because of potential rate increases that consumers may face when installing new solar (roughly $200 per megawatt compared to $50 per megawatt for wind, according to Minnesota Power) to meet the mandate, and for exceptions placed in both versions that passed the House and Senate which exempted iron and taconite mining operations and wood products plants from any rate increase associated with the new solar mandate. In addition, the bill also exempted municipal utilities and rural electric co-ops from the new solar power requirements. Supporters of the exemptions say that the provisions are necessary to protect energy-intensive industries that have to compete globally and that it will boost the state's only two solar panel manufacturers, while reducing air emissions from coal burning power plants.

The compromise bill that emerged from the conference committee must now go before the House and Senate again to receive final approval. Political observers expect the bill to pass and be sent to Governor Dayton for his signature.