SF 2971

3rd Engrossment - 86th Legislature (2009 - 2010) Posted on 03/25/2010 07:53am

A bill for an act
relating to energy; making technical changes and modifying provisions related
to utility report filings, hydrogen energy projects, weatherization programs,
high-voltage transmission lines, public utility commission assessments, and
utility metering for supportive housing; removing obsolete and redundant
language; authorizing individuals and entities to take certain easements in
agricultural land; providing for certain reporting requirements; providing for
wind and solar easements; amending Minnesota Statutes 2008, sections 16E.15,
subdivision 2; 117.225; 216B.16, by adding a subdivision; 216B.241, subdivision
2; 216B.812, subdivision 2; 216C.264; 216E.03, subdivision 7; 216E.18,
subdivision 3; 326B.106, subdivision 12; 500.221, subdivisions 2, 4; Minnesota
Statutes 2009 Supplement, section 117.189; Laws 2008, chapter 296, article 1,
section 25; repealing Minnesota Statutes 2008, sections 216C.19, subdivisions 2,
3, 13, 14, 15, 16, 18, 19, 20; 216C.262; Minnesota Statutes 2009 Supplement,
section 216C.19, subdivision 17.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2008, section 16E.15, subdivision 2, is amended to read:

Subd. 2.

Software sale fund.

(a) Except as provided in deleted text begin paragraphs deleted text end new text begin paragraph new text end (b)
deleted text begin and (c) deleted text end , proceeds of the sale or licensing of software products or services by the chief
information officer must be credited to the enterprise technology revolving fund. If a state
agency other than the Office of Enterprise Technology has contributed to the development
of software sold or licensed under this section, the chief information officer may reimburse
the agency by discounting computer services provided to that agency.

(b) Proceeds of the sale or licensing of software products or services developed by
the Pollution Control Agency, or custom developed by a vendor for the agency, must be
credited to the environmental fund.

deleted text begin (c) Proceeds of the sale or licensing of software products or services developed by
the Department of Education, or custom developed by a vendor for the agency, to support
the achieved savings assessment program, must be appropriated to the commissioner of
education and credited to the weatherization program to support weatherization activities.
deleted text end

Sec. 2.

Minnesota Statutes 2009 Supplement, section 117.189, is amended to read:

117.189 PUBLIC SERVICE CORPORATION EXCEPTIONS.

Sections 117.031; 117.036; 117.055, subdivision 2, paragraph (b); 117.186; 117.187;
117.188; and 117.52, subdivisions 1a and 4, do not apply to new text begin the use of eminent domain
authority by new text end public service corporations new text begin for any purpose other than construction or
expansion of:
new text end

new text begin (1) a high-voltage transmission line of 100 kilovolts or more, or ancillary
substations; or
new text end

new text begin (2) a natural gas, petroleum, or petroleum products pipeline, or ancillary compressor
stations or pumping stations new text end .

For purposes of an award of appraisal fees under section 117.085, the fees awarded
may not exceed $1,500 for all types of property except for a public service corporation's
use of eminent domain for a high-voltage transmission line, where the award may not
exceed $3,000.

new text begin For purposes of this section, "pipeline" does not include a natural gas distribution
line transporting gas to an end user.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment
and applies to eminent domain proceedings or actions commenced on or after that date.
"Commenced" means when service of notice of the petition under Minnesota Statutes,
section 117.055, is made.
new text end

Sec. 3.

Minnesota Statutes 2008, section 117.225, is amended to read:

117.225 EASEMENT DISCHARGE.

Whenever claiming that an easement acquired by condemnation is not being used for
the purposes for which it was acquired, the underlying fee owner may apply to the district
court of the county in which the land is situated for an order discharging the easement,
upon such terms as are just and equitable. Due notice of said application shall be given
to all interested parties. Provided, however, this section shall not apply to easements
acquired by condemnation by a public service corporation now or hereafter doing business
in the state of Minnesota new text begin for any purpose other than construction or expansion of:
new text end

new text begin (1) a high-voltage transmission line of 100 kilovolts or more, including ancillary
substations; or
new text end

new text begin (2) a natural gas, petroleum, or petroleum products pipeline, including ancillary
compressor stations or pumping stations.
new text end

new text begin For purposes of this section, "pipeline" does not include a natural gas distribution
line transporting gas to an end user new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment
and applies to eminent domain proceedings or actions commenced on or after that date.
"Commenced" means when service of notice of the petition under Minnesota Statutes,
section 117.055, is made.
new text end

Sec. 4.

Minnesota Statutes 2008, section 216B.16, is amended by adding a subdivision
to read:

new text begin Subd. 7e. new text end

new text begin Smart grid development and implementation plans. new text end

new text begin (a) It is
in the public interest to encourage Minnesota electric utilities to plan for the future
implementation of new smart grid technologies in order to improve the efficiency,
reliability, and security of the electric grid, encourage the development of renewable
energy, and accommodate the economic transfer of energy within and between states.
new text end

new text begin (b) For the purpose of this subdivision, "smart grid technologies" are advanced
technology-assisted efficiency programs and devices that allow for two-way informational
flows between electric suppliers and consumers, provide the capability to monitor
transmission flow, electric generation, customer preferences, and individual appliances or
energy-using devices, and that provide consumers with information necessary to utilize
variable rates. Smart grid technologies include, but are not limited to, infrastructure that
integrates digital information and controls technology to improve the reliability, security,
and efficiency of the electric grid.
new text end

new text begin (c) By April 1, 2011, and annually thereafter, electric utilities shall submit an
informational report to the Minnesota Public Utilities Commission summarizing the
utilities' plans for implementing smart grid technologies.
new text end

Sec. 5.

Minnesota Statutes 2008, section 216B.241, subdivision 2, is amended to read:

Subd. 2.

Programs.

(a) The commissioner may require public utilities to make
investments and expenditures in energy conservation improvements, explicitly setting
forth the interest rates, prices, and terms under which the improvements must be offered to
the customers. The required programs must cover no more than a three-year period. Public
utilities shall file conservation improvement plans by June 1, on a schedule determined by
order of the commissioner, but at least every three years. Plans received by a public utility
by June 1 must be approved or approved as modified by the commissioner by December
1 of that same year. The commissioner shall evaluate the program on the basis of
cost-effectiveness and the reliability of technologies employed. The commissioner's order
must provide to the extent practicable for a free choice, by consumers participating in the
program, of the device, method, material, or project constituting the energy conservation
improvement and for a free choice of the seller, installer, or contractor of the energy
conservation improvement, provided that the device, method, material, or project seller,
installer, or contractor is duly licensed, certified, approved, or qualified, including under
the residential conservation services program, where applicable.

(b) The commissioner may require a utility to make an energy conservation
improvement investment or expenditure whenever the commissioner finds that the
improvement will result in energy savings at a total cost to the utility less than the cost
to the utility to produce or purchase an equivalent amount of new supply of energy. The
commissioner shall nevertheless ensure that every public utility operate one or more
programs under periodic review by the department.

(c) Each public utility subject to subdivision 1a may spend and invest annually up to
ten percent of the total amount required to be spent and invested on energy conservation
improvements under this section by the utility on research and development projects
that meet the definition of energy conservation improvement in subdivision 1 and that
are funded directly by the public utility.

(d) A public utility may not spend for or invest in energy conservation improvements
that directly benefit a large energy facility or a large electric customer facility for which
the commissioner has issued an exemption pursuant to subdivision 1a, paragraph (b).
The commissioner shall consider and may require a utility to undertake a program
suggested by an outside source, including a political subdivision, a nonprofit corporation,
or community organization.

(e) A utility, a political subdivision, or a nonprofit or community organization
that has suggested a program, the attorney general acting on behalf of consumers and
small business interests, or a utility customer that has suggested a program and is not
represented by the attorney general under section 8.33 may petition the commission to
modify or revoke a department decision under this section, and the commission may do
so if it determines that the program is not cost-effective, does not adequately address the
residential conservation improvement needs of low-income persons, has a long-range
negative effect on one or more classes of customers, or is otherwise not in the public
interest. The commission shall reject a petition that, on its face, fails to make a reasonable
argument that a program is not in the public interest.

(f) The commissioner may order a public utility to include, with the filing of the
utility's deleted text begin proposed conservation improvement plan under paragraph (a) deleted text end new text begin annual status
report new text end , the results of an independent audit of new text begin all or a selection of new text end the utility's conservation
improvement programs and expenditures performed by the department or an auditor
with experience in the provision of energy conservation and energy efficiency services
approved by the commissioner and chosen by the utility. The audit must specify the
energy savings or increased efficiency in the use of energy within the service territory of
the utility that is the result of the spending and investments. The audit must evaluate the
cost-effectiveness of the utility's conservation programs.

Sec. 6.

Minnesota Statutes 2008, section 216B.812, subdivision 2, is amended to read:

Subd. 2.

Pilot projects.

(a) In consultation with appropriate representatives from
state agencies, local governments, universities, businesses, and other interested parties, the
Department of Commerce shall deleted text begin report back to the legislature by November 1, 2005, and
every two years thereafter, with deleted text end new text begin develop new text end a slate of proposed pilot projects that contribute
to realizing Minnesota's hydrogen economy goal as set forth in section 216B.8109. The
Department of Commerce must consider the following nonexclusive list of priorities in
developing the proposed slate of pilot projects:

(1) deploy "bridge" technologies such as hybrid-electric, off-road, and fleet vehicles
running on hydrogen or fuels blended with hydrogen;

(2) lead to cost-competitive, on-site renewable hydrogen production technologies;

(3) demonstrate nonvehicle applications for hydrogen;

(4) improve the cost and efficiency of hydrogen from renewable energy sources; and

(5) improve the cost and efficiency of hydrogen production using direct solar energy
without electricity generation as an intermediate step.

(b) For deployment projects that do not involve a demonstration component,
individual system components of the technology should, if feasible, meet commercial
performance standards and systems modeling must be completed to predict commercial
performance, risk, and synergies. In addition, the proposed pilots should meet as many of
the following criteria as possible:

(1) advance energy security;

(2) capitalize on the state's native resources;

(3) result in economically competitive infrastructure being put in place;

(4) be located where it will link well with existing and related projects and be
accessible to the public, now or in the future;

(5) demonstrate multiple, integrated aspects of renewable hydrogen infrastructure;

(6) include an explicit public education and awareness component;

(7) be scalable to respond to changing circumstances and market demands;

(8) draw on firms and expertise within the state where possible;

(9) include an assessment of its economic, environmental, and social impact; and

(10) serve other needs beyond hydrogen development.

Sec. 7.

Minnesota Statutes 2008, section 216C.264, is amended to read:

216C.264 COORDINATING RESIDENTIAL WEATHERIZATION
PROGRAMS.

Subdivision 1.

Agency designation.

The department is the state agency to apply
for, receive, and disburse money made available to the state by federal law for the purpose
of weatherizing the residences of low-income persons. The commissioner must coordinate
available federal money with state money appropriated for this purpose.

Subd. 2.

Grants.

The commissioner must make grants of federal and state money
to community action agencies and other public or private nonprofit agencies for the
purpose of weatherizing the residences of low-income persons. deleted text begin Grant applications must
be submitted in accordance with rules promulgated by the commissioner.
deleted text end

Subd. 3.

Benefits of weatherization.

In the case of any grant made to an owner of a
rental dwelling unit for weatherization, the commissioner must require that (1) the benefits
of weatherization assistance in connection with the dwelling unit accrue primarily to the
low-income family that resides in the unit; (2) the rents on the dwelling unit will not be
raised because of any increase in value due solely to the weatherization assistance; and (3)
no undue or excessive enhancement will occur to the value of the dwelling unit.

deleted text begin Subd. 4. deleted text end

deleted text begin Rules. deleted text end

deleted text begin The commissioner must promulgate rules that describe procedures
for the administration of grants, data to be reported by grant recipients, and compliance
with relevant federal regulations. The commissioner must require that a rental unit
weatherized under this section be rented to a household meeting the income limits of
the program for 24 of the 36 months after weatherization is complete. In applying this
restriction to multiunit buildings weatherized under this section, the commissioner must
require that occupancy continue to reflect the proportion of eligible households in the
building at the time of weatherization.
deleted text end

Subd. 5.

Grant allocation.

The commissioner must distribute supplementary
state grants in a manner consistent with the goal of producing the maximum number of
weatherized units. Supplementary state grants are provided primarily for the payment of
additional labor costs for the federal weatherization program, and as an incentive for the
increased production of weatherized units.

Criteria for the allocation of state grants to local agencies include existing local
agency production levels, emergency needs, and the potential for maintaining or increasing
acceptable levels of production in the area.

An eligible local agency may receive advance funding for 90 days' production, but
thereafter must receive grants solely on the basis of program criteria.

Subd. 6.

Eligibility criteria.

To the extent allowed by federal regulations, the
commissioner must ensure that the same income eligibility criteria apply to both the
weatherization program and the energy assistance program.

Sec. 8.

Minnesota Statutes 2008, section 216E.03, subdivision 7, is amended to read:

Subd. 7.

Considerations in designating sites and routes.

(a) The commission's
site and route permit determinations must be guided by the state's goals to conserve
resources, minimize environmental impacts, minimize human settlement and other land
use conflicts, and ensure the state's electric energy security through efficient, cost-effective
power supply and electric transmission infrastructure.

(b) To facilitate the study, research, evaluation, and designation of sites and routes,
the commission shall be guided by, but not limited to, the following considerations:

(1) evaluation of research and investigations relating to the effects on land, water
and air resources of large electric power generating plants and high-voltage transmission
lines and the effects of water and air discharges and electric and magnetic fields resulting
from such facilities on public health and welfare, vegetation, animals, materials and
aesthetic values, including baseline studies, predictive modeling, and evaluation of new or
improved methods for minimizing adverse impacts of water and air discharges and other
matters pertaining to the effects of power plants on the water and air environment;

(2) environmental evaluation of sites and routes proposed for future development and
expansion and their relationship to the land, water, air and human resources of the state;

(3) evaluation of the effects of new electric power generation and transmission
technologies and systems related to power plants designed to minimize adverse
environmental effects;

(4) evaluation of the potential for beneficial uses of waste energy from proposed
large electric power generating plants;

(5) analysis of the direct and indirect economic impact of proposed sites and routes
including, but not limited to, productive agricultural land lost or impaired;

(6) evaluation of adverse direct and indirect environmental effects that cannot be
avoided should the proposed site and route be accepted;

(7) evaluation of alternatives to the applicant's proposed site or route proposed
pursuant to subdivisions 1 and 2;

(8) evaluation of potential routes that would use or parallel existing railroad and
highway rights-of-way;

(9) evaluation of governmental survey lines and other natural division lines of
agricultural land so as to minimize interference with agricultural operations;

(10) evaluation of the future needs for additional high-voltage transmission lines
in the same general area as any proposed route, and the advisability of ordering the
construction of structures capable of expansion in transmission capacity through multiple
circuiting or design modifications;

(11) evaluation of irreversible and irretrievable commitments of resources should the
proposed site or route be approved; and

(12) when appropriate, consideration of problems raised by other state and federal
agencies and local entities.

(c) If the commission's rules are substantially similar to existing regulations of a
federal agency to which the utility in the state is subject, the federal regulations must
be applied by the commission.

(d) No site or route shall be designated which violates state agency rules.

new text begin (e) The commission must make specific findings that it has considered locating a
route for a high-voltage transmission line on an existing high-voltage transmission route
and the use of parallel existing highway right-of-way and, to the extent those are not used
for the route, the commission must state the reasons.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment
and applies to route applications filed on and after that date.
new text end

Sec. 9.

Minnesota Statutes 2008, section 216E.18, subdivision 3, is amended to read:

Subd. 3.

Funding; assessment.

The commission shall finance its baseline studies,
general environmental studies, development of criteria, inventory preparation, monitoring
of conditions placed on site and route permits, and all other work, other than specific site
and route designation, from an assessment made quarterly, at least 30 days before the start
of each quarter, by the commission against all utilities with annual retail kilowatt-hour
sales greater than 4,000,000 kilowatt-hours in the previous calendar year.

Each share shall be determined as follows: (1) the ratio that the annual retail
kilowatt-hour sales in the state of each utility bears to the annual total retail kilowatt-hour
sales in the state of all these utilities, multiplied by 0.667, plus (2) the ratio that the annual
gross revenue from retail kilowatt-hour sales in the state of each utility bears to the annual
total gross revenues from retail kilowatt-hour sales in the state of all these utilities,
multiplied by 0.333, as determined by the commission. The assessment shall be credited
to the special revenue fund and shall be paid to the state treasury within 30 days after
receipt of the bill, which shall constitute notice of said assessment and demand of payment
thereof. The total amount which may be assessed to the several utilities under authority
of this subdivision shall not exceed the sum of the annual budget of the commission
for carrying out the purposes of this subdivision. The assessment for the deleted text begin second deleted text end new text begin third new text end
quarter of each fiscal year shall be adjusted to compensate for the amount by which actual
expenditures by the commission for the preceding fiscal year were more or less than the
estimated expenditures previously assessed.

Sec. 10.

Minnesota Statutes 2008, section 326B.106, subdivision 12, is amended to
read:

Subd. 12.

Separate metering for electric service.

The standards concerning heat
loss, illumination, and climate control adopted pursuant to subdivision 1, shall require
that electrical service to individual dwelling units in buildings containing two or more
units be separately metered, with individual metering readily accessible to the individual
occupants. The standards authorized by this subdivision shall only apply to buildings
constructed after the effective date of the amended standards. Buildings intended for
occupancy primarily by persons who are 62 years of age or older or disabled, new text begin supportive
housing, new text end or deleted text begin which deleted text end new text begin buildings that new text end contain a majority of units not equipped with complete
kitchen facilities, shall be exempt from the provisions of this subdivision. new text begin For purposes
of this section, "supportive housing" means housing made available to individuals and
families with multiple barriers to obtaining and maintaining housing, including those who
are formerly homeless or at risk of homelessness and those who have a mental illness,
substance abuse disorder, debilitating disease, or a combination of these conditions.
new text end

Sec. 11.

Minnesota Statutes 2008, section 500.221, subdivision 2, is amended to read:

Subd. 2.

Aliens and non-American corporations.

Except as hereinafter provided,
no natural person shall acquire directly or indirectly any interest in agricultural land unless
the person is a citizen of the United States or a permanent resident alien of the United
States. In addition to the restrictions in section 500.24, no corporation, partnership,
limited partnership, trustee, or other business entity shall directly or indirectly, acquire
or otherwise obtain any interest, whether legal, beneficial or otherwise, in any title to
agricultural land unless at least 80 percent of each class of stock issued and outstanding or
80 percent of the ultimate beneficial interest of the entity is held directly or indirectly by
citizens of the United States or permanent resident aliens. This section shall not apply:

(1) to agricultural land that may be acquired by devise, inheritance, as security for
indebtedness, by process of law in the collection of debts, or by any procedure for the
enforcement of a lien or claim thereon, whether created by mortgage or otherwise. All
agricultural land acquired in the collection of debts or by the enforcement of a lien or
claim shall be disposed of within three years after acquiring ownership;

(2) to citizens or subjects of a foreign country whose rights to hold land are secured
by treaty;

(3) to lands used for transportation purposes by a common carrier, as defined in
section 218.011, subdivision 10;

(4) to lands or interests in lands acquired for use in connection with (i) the production
of timber and forestry products by a corporation organized under the laws of Minnesota,
or (ii) mining and mineral processing operations. Pending the development of agricultural
land for the production of timber and forestry products or mining purposes the land may
not be used for farming except under lease to a family farm, a family farm corporation or
an authorized farm corporation;

(5) to agricultural land operated for research or experimental purposes if the
ownership of the agricultural land is incidental to the research or experimental objectives
of the person or business entity and the total acreage owned by the person or business
entity does not exceed the acreage owned on May 27, 1977;

(6) to the purchase of any tract of 40 acres or less for facilities incidental to pipeline
operation by a company operating a pipeline as defined in section 216G.01, subdivision 3;

(7) to agricultural land and land capable of being used as farmland in vegetable
processing operations that is reasonably necessary to meet the requirements of pollution
control law or rules; deleted text begin or
deleted text end

(8) to an interest in agricultural land held on the August 1, 2003, by a natural person
with a nonimmigrant treaty investment visa, pursuant to United States Code, title 8,
section 1101(a)15(E)(ii), if, within five years after August 1, 2003, the person:

(i) disposes of all agricultural land held; or

(ii) becomes a permanent resident alien of the United States or a United States
citizen deleted text begin . deleted text end new text begin ; or
new text end

new text begin (9) to an easement taken by an individual or entity for the installation and repair
of transmission lines and for wind rights.
new text end

Sec. 12.

Minnesota Statutes 2008, section 500.221, subdivision 4, is amended to read:

Subd. 4.

Reports.

new text begin (a) new text end Any natural person, corporation, partnership, limited
partnership, trustee, or other business entity prohibited from future acquisition of
agricultural land may retain title to any agricultural land lawfully acquired within this state
prior to June 1, 1981, but shall file a report with the commissioner of agriculture annually
before January 31 containing a description of all agricultural land held within this state,
the purchase price and market value of the land, the use to which it is put, the date of
acquisition and any other reasonable information required by the commissioner.

new text begin (b) An individual or entity that qualifies for an exemption under subdivision 2, clause
(2) or (9), and owns an interest in agricultural land shall file a report with the commissioner
of agriculture within 30 days of acquisition and annually thereafter by January 31,
containing a description of all interests in agricultural land held within this state, the
purchase price of the interest and market value of the land, the use to which it is put, the
date of acquisition, and any other reasonable information required by the commissioner.
new text end

new text begin (c) new text end The commissioner shall make the information available to the public.

new text begin (d) new text end All required annual reports shall include a filing fee of $50 plus $10 for each
additional quarter section of land.

Sec. 13.

Laws 2008, chapter 296, article 1, section 25, the effective date, is amended to
read:

EFFECTIVE DATE.

This section is effective June 1, deleted text begin 2010 deleted text end new text begin 2011 new text end .

Sec. 14. new text begin TRANSMISSION LINE ROUTING.
new text end

new text begin (a) The Public Utilities Commission and the commissioner of transportation must
cooperate to implement the policy in Minnesota Statutes, section 216E.03, subdivision 7,
paragraph (e).
new text end

new text begin (b) The commission must report any statutory amendments required for the
implementation of Minnesota Statutes, section 216E.03, subdivision 7, paragraph (e)
to the chairs and ranking minority members of the energy and transportation policy
committees of the legislature by January 15, 2011.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 15. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2008, sections 216C.19, subdivisions 2, 3, 13, 14, 15, 16, 18,
19, and 20; and 216C.262, new text end new text begin are repealed.
new text end

new text begin Minnesota Statutes 2009 Supplement, section 216C.19, subdivision 17, new text end new text begin is repealed.
new text end