Minnesota Legislature
HF 86
1st Committee Engrossment - 86th Legislature (2009 - 2010) Posted on 03/19/2013 07:28pm
KEY: stricken = removed, old language.
underscored = added, new language.
Current Version - 1st Committee Engrossment
1.2relating to energy; establishing standard to reduce carbon intensity of
1.3transportation fuels;proposing coding for new law in Minnesota Statutes,
1.4chapter 239.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. [239.765] DEFINITIONS.
1.7 Subdivision 1. Scope. For the purposes of sections 239.765 and 239.766, the terms
1.8defined in this section have the meanings given them.
1.9 Subd. 2. Carbon dioxide equivalent. "Carbon dioxide equivalent" has the meaning
1.10given in section 216H.10, subdivision 3.
1.11 Subd. 3. Carbon intensity. "Carbon intensity" means the quantity of carbon dioxide
1.12or carbon dioxide equivalent emissions per BTU of transportation fuel sold in this state,
1.13measured on a life cycle basis.
1.14 Subd. 4. Commissioner. "Commissioner" means the commissioner of commerce.
1.15 Subd. 5. Indirect carbon inputs. "Indirect carbon inputs" means an additional
1.16value added to a transportation fuel's carbon intensity that measures increased greenhouse
1.17gas emissions released as a result of general market forces that is not part of a specific
1.18fuel supply chain.
1.19 Subd. 6. Motor vehicle. "Motor vehicle" means a vehicle that is self-propelled
1.20and designed for use on public highways.
1.21 Subd. 7. Renewable transportation fuel producer. "Renewable transportation
1.22fuel producer" means a manufacturer or producer of ethanol or biodiesel. "Renewable
1.23transportation fuel producer" includes a manufacturer or producer of transportation fuel
1.24that is not a "responsible party" under subdivision 8.
2.1 Subd. 8. Responsible party. "Responsible party" means a person who refines,
2.2produces, blends, or imports transportation fuel for sale in this state who:
2.3(1) receives petroleum products in this state for storage and subsequent distribution
2.4by tank car or tank truck;
2.5(2) produces, manufactures, or refines petroleum products for sale in this state; or
2.6(3) imports petroleum products via boat, barge, truck, or pipeline into this state for
2.7sale within the state for storage and subsequent delivery or further transportation from
2.8boat, barge, truck, or pipeline terminals in this state.
2.9Responsible party does not include a retailer or renewable transportation fuel
2.10producer.
2.11 Subd. 9. Transportation fuel. "Transportation fuel" means a fuel used to propel a
2.12motor vehicle.
2.13 Sec. 2. [239.766] LOW-CARBON TRANSPORTATION FUEL REDUCTION
2.14STANDARD.
2.15 Subdivision 1. Reduction standard. (a) Between 2011 and the end of 2020, a
2.16responsible party shall reduce the carbon intensity of transportation fuels it produces,
2.17refines, blends, or imports for sale in this state by at least ten percent, measured from a
2.182005 baseline. The reduction must be measured by using the applicable carbon intensity
2.19value of a responsible party for a particular transportation fuel that is set by law, by a rule
2.20specifically adopted pursuant to this section, or by a determination of the commissioner
2.21under paragraph (b). The reduction must be at least one percent annually, unless the
2.22commissioner has approved an alternative compliance schedule under paragraph (b) or
2.23granted a delay under subdivision 2.
2.24(b) A responsible party may petition the commissioner to approve an alternative
2.25compliance schedule from the schedule described in paragraph (a). The commissioner
2.26shall, after notice and hearing, approve an alternative compliance schedule if the
2.27responsible party demonstrates that the public interest is served by an alternative schedule.
2.28(c) A responsible party may use any method to achieve compliance with the
2.29reduction standard, including, but not limited to:
2.30(1) blending high-carbon intensity fuels with low-carbon intensity fuels; or
2.31(2) changing production processes, extraction methods, and other activities that
2.32reduce carbon intensity.
2.33(d) The commissioner shall advise and assist responsible parties and others regarding
2.34methods to achieve the reduction standard.
3.1 Subd. 2. Delayed compliance with reduction standard. (a) A responsible
3.2party may petition the commissioner at any time to delay the responsible party's
3.3required compliance with the reduction standard established under subdivision 1. The
3.4commissioner may, after notice and hearing, grant a delay to a responsible party from
3.5compliance with a reduction standard if the commissioner determines that meeting the
3.6reduction standard:
3.7(1) is not achievable as a result of the federal government's failure to grant a waiver
3.8for E-20 gasoline;
3.9(2) will itself cause an increase in renewable fuel costs exceeding five cents per
3.10gallon; or
3.11(3) is not achievable as a result of inadequate supplies of lower carbon intensity
3.12transportation fuels.
3.13(b) A responsible party may not be penalized for failing to meet its reduction
3.14standard to the extent that the commissioner grants a delay under this subdivision.
3.15 Subd. 3. Carbon intensity values. Unless a different carbon intensity value is
3.16established by the commissioner under subdivision 4, the commissioner shall use the
3.17following carbon intensity values to determine compliance with the reduction standard
3.18established under subdivision 1.
3.26The commissioner shall use the carbon intensity value for the mix of transportation
3.27fuels refined, blended, produced, and imported by a responsible party or renewable
3.28transportation fuel producer in 2005 as the baseline against which to measure changes in
3.29carbon intensity in order to determine compliance with the reduction standard.
3.30 Subd. 4. Alternative carbon intensity value. A responsible party or renewable
3.31transportation fuel producer may propose to the commissioner a carbon intensity value
3.32for a transportation fuel it produces, blends, or imports that differs from the value
3.33established in subdivision 3. A responsible party or renewable transportation fuel producer
3.34proposing a different carbon intensity value must demonstrate by a preponderance of
3.35scientific evidence that the value established in subdivision 3 is not appropriate. If the
3.36commissioner, after notice and hearing and consultation with the commissioners of
3.37agriculture and the Pollution Control Agency, determines that the value established in
4.1subdivision 3 is not appropriate, the commissioner shall establish a different value for
4.2the transportation fuel based on evidence in the hearing record. A responsible party or
4.3renewable transportation fuel producer proposing a different carbon intensity value
4.4is presumed to have demonstrated that the value established in subdivision 3 is not
4.5appropriate if it proposes an alternative carbon intensity value calculated by applying the
4.6"Greenhouse Gases, Regulated Emissions, and Energy Use in Transportation" (GREET)
4.7model developed by the Argonne National Laboratory.
4.8 Subd. 5. Modifying carbon intensity values. The commissioner may, after June 30,
4.92011, propose to the legislature that a carbon intensity value of a transportation fuel listed
4.10in subdivision 3 be amended to incorporate indirect carbon inputs if the commissioner,
4.11after consultation with (1) scientific authorities, including, but not limited to, Argonne
4.12National Laboratory and Oak Ridge National Laboratory; (2) academic consultants
4.13from agriculture research institutions, including the University of Minnesota, Iowa State
4.14University, Michigan State University, and the University of Nebraska; and (3) the
4.15commissioners of agriculture and the Pollution Control Agency, determines that reliable
4.16and consistent estimates of indirect carbon inputs can be developed through analytically
4.17rigorous methods for all transportation fuels listed in subdivision 3. The commissioner
4.18shall report the results of the consultations, and any recommendations for changes to
4.19carbon intensity values in subdivision 3, to the chairs and ranking minority members of
4.20the legislative committees with primary jurisdiction over energy, environmental, and
4.21agricultural policy.
4.22 Subd. 6. Reporting. Beginning January 15, 2011, and each year thereafter through
4.232020, a responsible party shall submit a report to the commissioner describing activities it
4.24has taken or plans to take in order to comply with the reduction standard established in this
4.25section. A responsible party shall report to the commissioner any information requested by
4.26the commissioner to assist the commissioner in determining whether compliance with the
4.27reduction standard of this section has been achieved. Beginning in 2013, the commissioner
4.28may accept reports filed pursuant to other state and federal laws for purposes of compliance
4.29with this section to the extent those reports contain information required under this section.
4.30 Subd. 7. Compliance; penalty. A responsible party shall cooperate with the
4.31commissioner as requested in order to assist the commissioner in determining whether
4.32compliance with the reduction standard established under this section is being achieved.
4.33Beginning in 2014, a responsible party may be ordered to comply and fined an amount
4.34equal to the cost of achieving compliance. The penalty may be imposed for each year the
4.35reduction standard is not achieved. The commissioner shall consider the efforts of the
5.1responsible party to achieve the reduction standard in determining whether to impose a
5.2penalty and in determining the amount of a penalty.
5.3 Subd. 8. Rules. The commissioner shall, by December 10, 2010, adopt rules
5.4necessary to implement and administer this section.
1.3transportation fuels;proposing coding for new law in Minnesota Statutes,
1.4chapter 239.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. [239.765] DEFINITIONS.
1.7 Subdivision 1. Scope. For the purposes of sections 239.765 and 239.766, the terms
1.8defined in this section have the meanings given them.
1.9 Subd. 2. Carbon dioxide equivalent. "Carbon dioxide equivalent" has the meaning
1.10given in section 216H.10, subdivision 3.
1.11 Subd. 3. Carbon intensity. "Carbon intensity" means the quantity of carbon dioxide
1.12or carbon dioxide equivalent emissions per BTU of transportation fuel sold in this state,
1.13measured on a life cycle basis.
1.14 Subd. 4. Commissioner. "Commissioner" means the commissioner of commerce.
1.15 Subd. 5. Indirect carbon inputs. "Indirect carbon inputs" means an additional
1.16value added to a transportation fuel's carbon intensity that measures increased greenhouse
1.17gas emissions released as a result of general market forces that is not part of a specific
1.18fuel supply chain.
1.19 Subd. 6. Motor vehicle. "Motor vehicle" means a vehicle that is self-propelled
1.20and designed for use on public highways.
1.21 Subd. 7. Renewable transportation fuel producer. "Renewable transportation
1.22fuel producer" means a manufacturer or producer of ethanol or biodiesel. "Renewable
1.23transportation fuel producer" includes a manufacturer or producer of transportation fuel
1.24that is not a "responsible party" under subdivision 8.
2.1 Subd. 8. Responsible party. "Responsible party" means a person who refines,
2.2produces, blends, or imports transportation fuel for sale in this state who:
2.3(1) receives petroleum products in this state for storage and subsequent distribution
2.4by tank car or tank truck;
2.5(2) produces, manufactures, or refines petroleum products for sale in this state; or
2.6(3) imports petroleum products via boat, barge, truck, or pipeline into this state for
2.7sale within the state for storage and subsequent delivery or further transportation from
2.8boat, barge, truck, or pipeline terminals in this state.
2.9Responsible party does not include a retailer or renewable transportation fuel
2.10producer.
2.11 Subd. 9. Transportation fuel. "Transportation fuel" means a fuel used to propel a
2.12motor vehicle.
2.13 Sec. 2. [239.766] LOW-CARBON TRANSPORTATION FUEL REDUCTION
2.14STANDARD.
2.15 Subdivision 1. Reduction standard. (a) Between 2011 and the end of 2020, a
2.16responsible party shall reduce the carbon intensity of transportation fuels it produces,
2.17refines, blends, or imports for sale in this state by at least ten percent, measured from a
2.182005 baseline. The reduction must be measured by using the applicable carbon intensity
2.19value of a responsible party for a particular transportation fuel that is set by law, by a rule
2.20specifically adopted pursuant to this section, or by a determination of the commissioner
2.21under paragraph (b). The reduction must be at least one percent annually, unless the
2.22commissioner has approved an alternative compliance schedule under paragraph (b) or
2.23granted a delay under subdivision 2.
2.24(b) A responsible party may petition the commissioner to approve an alternative
2.25compliance schedule from the schedule described in paragraph (a). The commissioner
2.26shall, after notice and hearing, approve an alternative compliance schedule if the
2.27responsible party demonstrates that the public interest is served by an alternative schedule.
2.28(c) A responsible party may use any method to achieve compliance with the
2.29reduction standard, including, but not limited to:
2.30(1) blending high-carbon intensity fuels with low-carbon intensity fuels; or
2.31(2) changing production processes, extraction methods, and other activities that
2.32reduce carbon intensity.
2.33(d) The commissioner shall advise and assist responsible parties and others regarding
2.34methods to achieve the reduction standard.
3.1 Subd. 2. Delayed compliance with reduction standard. (a) A responsible
3.2party may petition the commissioner at any time to delay the responsible party's
3.3required compliance with the reduction standard established under subdivision 1. The
3.4commissioner may, after notice and hearing, grant a delay to a responsible party from
3.5compliance with a reduction standard if the commissioner determines that meeting the
3.6reduction standard:
3.7(1) is not achievable as a result of the federal government's failure to grant a waiver
3.8for E-20 gasoline;
3.9(2) will itself cause an increase in renewable fuel costs exceeding five cents per
3.10gallon; or
3.11(3) is not achievable as a result of inadequate supplies of lower carbon intensity
3.12transportation fuels.
3.13(b) A responsible party may not be penalized for failing to meet its reduction
3.14standard to the extent that the commissioner grants a delay under this subdivision.
3.15 Subd. 3. Carbon intensity values. Unless a different carbon intensity value is
3.16established by the commissioner under subdivision 4, the commissioner shall use the
3.17following carbon intensity values to determine compliance with the reduction standard
3.18established under subdivision 1.
3.26The commissioner shall use the carbon intensity value for the mix of transportation
3.27fuels refined, blended, produced, and imported by a responsible party or renewable
3.28transportation fuel producer in 2005 as the baseline against which to measure changes in
3.29carbon intensity in order to determine compliance with the reduction standard.
3.30 Subd. 4. Alternative carbon intensity value. A responsible party or renewable
3.31transportation fuel producer may propose to the commissioner a carbon intensity value
3.32for a transportation fuel it produces, blends, or imports that differs from the value
3.33established in subdivision 3. A responsible party or renewable transportation fuel producer
3.34proposing a different carbon intensity value must demonstrate by a preponderance of
3.35scientific evidence that the value established in subdivision 3 is not appropriate. If the
3.36commissioner, after notice and hearing and consultation with the commissioners of
3.37agriculture and the Pollution Control Agency, determines that the value established in
4.1subdivision 3 is not appropriate, the commissioner shall establish a different value for
4.2the transportation fuel based on evidence in the hearing record. A responsible party or
4.3renewable transportation fuel producer proposing a different carbon intensity value
4.4is presumed to have demonstrated that the value established in subdivision 3 is not
4.5appropriate if it proposes an alternative carbon intensity value calculated by applying the
4.6"Greenhouse Gases, Regulated Emissions, and Energy Use in Transportation" (GREET)
4.7model developed by the Argonne National Laboratory.
4.8 Subd. 5. Modifying carbon intensity values. The commissioner may, after June 30,
4.92011, propose to the legislature that a carbon intensity value of a transportation fuel listed
4.10in subdivision 3 be amended to incorporate indirect carbon inputs if the commissioner,
4.11after consultation with (1) scientific authorities, including, but not limited to, Argonne
4.12National Laboratory and Oak Ridge National Laboratory; (2) academic consultants
4.13from agriculture research institutions, including the University of Minnesota, Iowa State
4.14University, Michigan State University, and the University of Nebraska; and (3) the
4.15commissioners of agriculture and the Pollution Control Agency, determines that reliable
4.16and consistent estimates of indirect carbon inputs can be developed through analytically
4.17rigorous methods for all transportation fuels listed in subdivision 3. The commissioner
4.18shall report the results of the consultations, and any recommendations for changes to
4.19carbon intensity values in subdivision 3, to the chairs and ranking minority members of
4.20the legislative committees with primary jurisdiction over energy, environmental, and
4.21agricultural policy.
4.22 Subd. 6. Reporting. Beginning January 15, 2011, and each year thereafter through
4.232020, a responsible party shall submit a report to the commissioner describing activities it
4.24has taken or plans to take in order to comply with the reduction standard established in this
4.25section. A responsible party shall report to the commissioner any information requested by
4.26the commissioner to assist the commissioner in determining whether compliance with the
4.27reduction standard of this section has been achieved. Beginning in 2013, the commissioner
4.28may accept reports filed pursuant to other state and federal laws for purposes of compliance
4.29with this section to the extent those reports contain information required under this section.
4.30 Subd. 7. Compliance; penalty. A responsible party shall cooperate with the
4.31commissioner as requested in order to assist the commissioner in determining whether
4.32compliance with the reduction standard established under this section is being achieved.
4.33Beginning in 2014, a responsible party may be ordered to comply and fined an amount
4.34equal to the cost of achieving compliance. The penalty may be imposed for each year the
4.35reduction standard is not achieved. The commissioner shall consider the efforts of the
5.1responsible party to achieve the reduction standard in determining whether to impose a
5.2penalty and in determining the amount of a penalty.
5.3 Subd. 8. Rules. The commissioner shall, by December 10, 2010, adopt rules
5.4necessary to implement and administer this section.