HF 2527

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to pollution control; establishing a low-carbon fuel standard to reduce
the carbon intensity of transportation fuels in Minnesota by 2020; aligning
statutory references to low-carbon energy; requiring rulemaking; appropriating
money; amending Minnesota Statutes 2006, section 216B.241, subdivision 6, as
amended; proposing coding for new law in Minnesota Statutes, chapter 116.

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

Section 1.

new text begin [116.741] LOW-CARBON FUEL STANDARD.
new text end

new text begin Subdivision 1. new text end

new text begin Statewide goal. new text end

new text begin It is a goal of the state that by 2020, the carbon
intensity of transportation fuels offered for sale in Minnesota shall be reduced by at least
ten percent.
new text end

new text begin Subd. 2. new text end

new text begin Definitions. new text end

new text begin (a) For the purposes of this section, the following terms
have the meanings given.
new text end

new text begin (b) "Commissioner" means the commissioner of the Pollution Control Agency.
new text end

new text begin (c) "Carbon intensity" means the quantity of carbon dioxide emitted, as measured on
a full fuel cycle basis, per BTU of energy provided by a transportation fuel.
new text end

new text begin (d) "Full fuel cycle basis" means all energy inputs and emissions related to the entire
life-cycle of a transportation fuel, including the production and extraction of the feedstock
or other primary energy source, and the processing, transportation, storage, distribution,
and combustion or other chemical conversion of the fuel.
new text end

new text begin Subd. 3. new text end

new text begin Applicability; measurement. new text end

new text begin The low-carbon fuel standard in subdivision
1 applies to any person producing, refining, blending, or importing transportation fuels
in Minnesota. Progress in reaching the carbon intensity reduction shall be measured
on a full fuel cycle basis.
new text end

new text begin Subd. 4. new text end

new text begin Coordination; compliance schedule; rules. new text end

new text begin By January 1, 2008, the
commissioner, in consultation with the commissioner of commerce and the University of
Minnesota, shall develop a compliance schedule for achieving the goal in subdivision 1.
In formulating the schedule, the commissioner must evaluate and select the most effective
and cost-efficient methods for achieving the goal in subdivision 1. Possible methods must
include, but need not be limited to: research and outreach efforts designed to lower the
carbon intensity, on a full fuel cycle basis, of existing transportation fuels; mandates;
market-based cap and trade systems; carbon taxation; the imposition of fines and other
penalties; and financial or other incentives to reduce the carbon intensity of existing
transportation fuels or facilitate the development and market adoption of additional,
low-carbon transportation fuels. After January 1, 2008, the commissioner shall adopt rules
necessary to implement the compliance schedule.
new text end

new text begin Subd. 5. new text end

new text begin Annual reports. new text end

new text begin Biannually until 2020, the commissioner shall report on
the progress in achieving the goal in subdivision 1 to the house and senate committees
with jurisdiction over environment and energy policy.
new text end

Sec. 2.

Minnesota Statutes 2006, section 216B.241, subdivision 6, as amended by
Laws 2007, chapter 57, article 2, section 21, is amended to read:

Subd. 6.

Renewable energy research.

(a) A public utility that owns a nuclear
generation facility in the state shall spend five percent of the total amount that utility
is required to spend under this section to support basic and applied research and
demonstration activities at the University of Minnesota Initiative for Renewable Energy
and the Environment for the development of renewable energy sources and technologies.
The utility shall transfer the required amount to the University of Minnesota on or before
July 1 of each year and that annual amount shall be deducted from the amount of money the
utility is required to spend under this section. The University of Minnesota shall transfer
at least ten percent of these funds to at least one rural campus or experiment station.

(b) Activities funded under this subdivision may include, but are not limited to:

(1) environmentally sound production of energy from a renewable energy source
including biomass;

(2) environmentally sound production of hydrogen from biomass and any other
renewable energy source for energy storage and energy utilization;

(3) development of energy conservation and efficient energy utilization technologies;

(4) energy storage technologies; and

(5) analysis of policy options to facilitate adoption of technologies that use or
produce low-carbon renewable energy.

(c) Notwithstanding other law to the contrary, the utility may, but is not required to,
spend more than two percent of its gross operating revenues from service provided in this
state under this section or section 216B.2411.

(d) For the purposes of this subdivision:

(1) "renewable energy source: means hydro, wind, solar, biomass and geothermal
energy, and microorganisms used as an energy source; deleted text begin and
deleted text end

(2) "biomass" means plant and animal material, agricultural and forest residues,
mixed municipal solid waste, and sludge from wastewater treatment deleted text begin . deleted text end new text begin ; and
new text end

new text begin (3) "low-carbon renewable energy" means energy derived from a renewable
energy source that, when substituted for fuel derived from fossil fuels or other more
carbon-intensive sources, contributes to achievement of the statewide low-carbon fuel
standard in section 116.741.
new text end

(e) This subdivision expires June 30, 2010.

Sec. 3. new text begin APPROPRIATION.
new text end

new text begin $....... is appropriated from the general fund to the commissioner of the Pollution
Control Agency for the biennium ending June 30, 2009, for the purposes of section 1.
new text end