SF 4534

Introduction - 94th Legislature (2025 - 2026)

Posted on 03/18/2026 09:39 a.m.

A bill for an act
relating to energy; allowing expenditures on fuel-switching improvements made
to low-income households to apply to the low-income conservation spending
requirement for municipal utilities and cooperative electric associations; amending
Minnesota Statutes 2024, section 216B.2403, subdivision 5.

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

Section 1.

Minnesota Statutes 2024, section 216B.2403, subdivision 5, is amended to read:

Subd. 5.

Energy conservation programs for low-income households.

(a) A
consumer-owned utility subject to this section must provide energy conservation programs
to low-income households. The commissioner must evaluate a consumer-owned utility's
plans under this section by considering the consumer-owned utility's historic spending on
energy conservation programs directed to low-income households, the rate of customer
participation in and the energy savings resulting from those programs, and the number of
low-income persons residing in the consumer-owned utility's service territory. A municipal
utility that furnishes natural gas service must spend at least 0.2 percent of the municipal
utility's most recent three-year average gross operating revenue from residential customers
in Minnesota on energy conservation programs for low-income households. new text begin Except as
provided in paragraph (j), new text end a consumer-owned utility that furnishes electric service must
spend at least 0.2 percent of the consumer-owned utility's gross operating revenue from
residential customers in Minnesota on energy conservation programs for low-income
households. The requirement under this paragraph applies to each generation and transmission
cooperative association's aggregate gross operating revenue from the sale of electricity to
residential customers in Minnesota by all of the association's member distribution
cooperatives.

(b) To meet all or part of the spending requirements of paragraph (a), a consumer-owned
utility may contribute money to the energy and conservation account established in section
216B.241, subdivision 2a. An energy conservation optimization plan must state the amount
of contributions the consumer-owned utility plans to make to the energy and conservation
account. Contributions to the account must be used for energy conservation programs serving
low-income households, including renters, located in the service area of the consumer-owned
utility making the contribution. Contributions must be remitted to the commissioner by
February 1 each year.

(c) The commissioner must establish energy conservation programs for low-income
households funded through contributions to the energy and conservation account under
paragraph (b). When establishing energy conservation programs for low-income households,
the commissioner must consult political subdivisions, utilities, and nonprofit and community
organizations, including organizations providing energy and weatherization assistance to
low-income households. The commissioner must record and report expenditures and energy
savings achieved as a result of energy conservation programs for low-income households
funded through the energy and conservation account in the report required under section
216B.241, subdivision 1c, paragraph (f). The commissioner may contract with a political
subdivision, nonprofit or community organization, public utility, municipality, or
consumer-owned utility to implement low-income programs funded through the energy and
conservation account.

(d) A consumer-owned utility may petition the commissioner to modify the required
spending under this subdivision if the consumer-owned utility and the commissioner were
unable to expend the amount required for three consecutive years.

(e) The commissioner must develop and establish guidelines for determining the eligibility
of multifamily buildings to participate in energy conservation programs provided to
low-income households. Notwithstanding the definition of low-income household in section
216B.2402, a consumer-owned utility or association may apply the most recent guidelines
published by the department for purposes of determining the eligibility of multifamily
buildings to participate in low-income programs. The commissioner must convene a
stakeholder group to review and update these guidelines by August 1, 2021, and at least
once every five years thereafter. The stakeholder group must include but is not limited to
representatives of public utilities; municipal electric or gas utilities; electric cooperative
associations; multifamily housing owners and developers; and low-income advocates.

(f) Up to 15 percent of a consumer-owned utility's spending on low-income energy
conservation programs may be spent on preweatherization measures. A consumer-owned
utility is prohibited from claiming energy savings from preweatherization measures toward
the consumer-owned utility's energy savings goal.

(g) The commissioner must, by order, establish a list of preweatherization measures
eligible for inclusion in low-income energy conservation programs no later than March 15,
2022.

(h) A Healthy AIR (Asbestos Insulation Removal) account is established as a separate
account in the special revenue fund in the state treasury. A consumer-owned utility may
elect to contribute money to the Healthy AIR account to provide preweatherization measures
for households eligible for weatherization assistance from the state weatherization assistance
program in section 216C.264. Remediation activities must be executed in conjunction with
federal weatherization assistance program services. Money contributed to the account by a
consumer-owned utility counts toward: (1) the minimum low-income spending requirement
under paragraph (a); and (2) the cap on preweatherization measures under paragraph (f).
Money in the account is annually appropriated to the commissioner of commerce to pay for
Healthy AIR-related activities.

(i) This paragraph applies to a consumer-owned utility that supplies electricity to a
low-income household whose primary heating fuel is supplied by an entity other than a
public utility. Any spending on space and water heating energy conservation improvements
and efficient fuel-switching by the consumer-owned utility on behalf of the low-income
household may be applied to the consumer owned utility's spending requirement under
paragraph (a). To the maximum extent possible, a consumer-owned utility providing services
under this paragraph must offer the services in conjunction with weatherization services
provided under section 216C.264.

new text begin (j) A consumer-owned utility's spending on efficient fuel-switching improvements made
to low-income households may be applied to the consumer-owned utility's low-income
conservation spending requirement under paragraph (a).
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 applicable fuel-switching improvements installed on or after that date.
new text end