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Key: (1) language to be deleted (2) new language


                         Laws of Minnesota 1983 

                        CHAPTER 179--H.F.No. 189
           An act relating to energy; requiring certain 
          conservation investments by regulated utilities; 
          amending Minnesota Statutes 1982, sections 116J.09; 
          116J.18, subdivision 1a; 216A.07, subdivision 3; 
          216B.03; 216B.16, subdivision 1; and 216B.241, 
          subdivisions 1, 2, and 3. 
    Section 1.  Minnesota Statutes 1982, section 116J.09, is 
amended to read: 
    116J.09 [DUTIES.] 
    The commissioner shall: 
    (a) Manage the department as the central repository within 
the state government for the collection of data on energy; 
    (b) Prepare and adopt an emergency allocation plan 
specifying actions to be taken in the event of an impending 
serious shortage of energy, or a threat to public health, 
safety, or welfare; 
    (c) Undertake a continuing assessment of trends in the 
consumption of all forms of energy and analyze the social, 
economic, and environmental consequences of these trends; 
    (d) Carry out energy conservation measures as specified by 
the legislature and recommend to the governor and the 
legislature additional energy policies and conservation measures 
as required to meet the objectives of sections 116J.05 to 
    (e) Collect and analyze data relating to present and future 
demands and resources for all sources of energy, and specify 
energy needs for the state and various service areas as a basis 
for planning large energy facilities; 
    (f) Require certificate of need for construction of large 
energy facilities; 
    (g) Evaluate policies governing the establishment of rates 
and prices for energy as related to energy conservation, and 
other goals and policies of sections 116J.05 to 116J.30, and 
make recommendations for changes in energy pricing policies and 
rate schedules; 
    (h) Study the impact and relationship of the state energy 
policies to international, national, and regional energy 
    (i) Design and implement a state program for the 
conservation of energy; this program shall include but not be 
limited to, general commercial, industrial, and residential, and 
transportation areas; such program shall also provide for the 
evaluation of energy systems as they relate to lighting, 
heating, refrigeration, air conditioning, building design and 
operation, and appliance manufacturing and operation;  
    (j) Inform and educate the public about the sources and 
uses of energy and the ways in which persons can conserve energy;
    (k) Dispense funds made available for the purpose of 
research studies and projects of professional and civic 
orientation, which are related to either energy conservation or 
the development of alternative energy technologies which 
conserve nonrenewable energy resources while creating minimum 
environmental impact; 
    (l) Charge other governmental departments and agencies 
involved in energy related activities with specific information 
gathering goals and require that those goals be met.  
    Further, the commissioner may participate fully in hearings 
before the public utilities commission on matters pertaining to 
rate design, cost allocation, efficient resource utilization, 
utility conservation investments, small power production, 
cogeneration, and other rate issues.  The commissioner shall 
support the policies stated in section 116J.05 and shall prepare 
and defend testimony proposed to encourage energy conservation 
improvements as defined in section 216B.241. 
    Sec. 2.  Minnesota Statutes 1982, section 116J.18, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [RATE PLAN.] The energy policy and conservation 
report shall include a section prepared by the public utilities 
commission.  The commission's section shall be prepared in 
consultation with the commissioner of the department of energy, 
planning and development and shall include, but not be limited 
to, all of the following:  
    (a) A description and analysis of the commission's rate 
design policy as it pertains to the goals stated in sections 
116J.05, 216B.164, and 216B.241, including a description of all 
energy conservation improvements ordered by the commission; and 
     (b) Recommendations to the governor and the legislature for 
administrative and legislative actions to accomplish the 
purposes of sections 116J.05, 216B.164, and 216B.241. 
    Sec. 3.  Minnesota Statutes 1982, section 216A.07, 
subdivision 3, is amended to read: 
    Subd. 3.  [INTERVENTION IN PROCEEDINGS.] The director may 
intervene as a party in all proceedings before the commission.  
When intervening in gas or electric hearings, the director shall 
prepare and defend testimony designed to encourage energy 
conservation improvements as defined in section 216B.241.  The 
attorney general shall act as counsel in the proceedings.  
    Sec. 4.  Minnesota Statutes 1982, section 216B.03, is 
amended to read: 
    216B.03 [REASONABLE RATE.] 
    Every rate made, demanded, or received by any public 
utility, or by any two or more public utilities jointly, shall 
be just and reasonable.  Rates shall not be unreasonably 
preferential, unreasonably prejudicial or discriminatory, but 
shall be sufficient, equitable and consistent in application to 
a class of consumers.  To the maximum reasonable extent, the 
commission shall set rates to encourage energy conservation and 
renewable energy use and to further the goals of sections 
116J.05, 216B.164, and 216B.241.  Any doubt as to reasonableness 
should be resolved in favor of the consumer.  For rate making 
purposes a public utility may treat two or more municipalities 
served by it as a single class wherever the populations are 
comparable in size or the conditions of service are similar.  
    Sec. 5.  Minnesota Statutes 1982, section 216B.16, 
subdivision 1, is amended to read: 
    Subdivision 1.  [NOTICE.] Unless the commission otherwise 
orders, no public utility shall change a rate which has been 
duly established under this chapter, except upon 60 days notice 
to the commission.  The notice shall include statements of 
facts, expert opinions, substantiating documents, and exhibits 
including an energy conservation improvement plan pursuant to 
section 216B.241, supporting the change requested, and state the 
change proposed to be made in the rates then in force and the 
time when the modified rates will go into effect.  The filing 
utility shall give written notice, as approved by the 
commission, of the proposed change to the governing body of each 
municipality and county in the area affected.  All proposed 
changes shall be shown by filing new schedules or shall be 
plainly indicated upon schedules on file and in force at the 
    Sec. 6.  Minnesota Statutes 1982, section 216B.241, 
subdivision 1, is amended to read: 
    Subdivision 1.  [DEFINITIONS.] For purposes of this 
section, the terms defined in this subdivision shall have the 
meanings given them:  
    (a) "Commission" means the public utilities commission, 
department of public service;  
    (b) "Energy conservation improvement" means the purchase or 
installation of any device, method or material that increases 
the efficiency in the residential use of electricity or natural 
gas including, but not limited to:  
    (1) insulation and ventilation;  
    (2) storm or thermal doors or windows;  
    (3) caulking and weatherstripping;  
    (4) furnace efficiency modifications;  
    (5) thermostat or lighting controls;  
    (6) awnings; or 
    (7) systems to turn off or vary the delivery of energy.  
The term "energy conservation improvement" does not include 
includes any device or method which creates, converts or 
actively uses energy from renewable sources such as solar, wind 
and biomass providing such device or method conforms with 
national or state performance and quality standards whenever 
    (c) "Investments and expenses of a public utility" includes 
the investments and expenses incurred by a public utility in 
connection with an energy conservation improvement including, 
but not limited to:  
    (1) the differential in interest cost between the market 
rate and the rate charged on a no interest or below market 
interest loan made by a public utility to a customer for the 
purchase or installation of an energy conservation improvement;  
    (2) the difference between the utility's cost of purchase 
or installation of energy conservation improvements and any 
price charged by a public utility to a customer for such 
    (d) "Public utility" has the same meaning as given that 
term in section 216B.02, subdivision 4.  For the purposes of 
this section, "public utility" shall not include cooperative 
electric associations that become subject to rate regulation 
after April 16, 1980. 
    Sec. 7.  Minnesota Statutes 1982, section 216B.241, 
subdivision 2, is amended to read: 
    Subd. 2.  [PROGRAMS.] The commission may order public 
utilities to make investments and expenditures in energy 
conservation improvements, explicitly setting forth the interest 
rates, prices, and terms under which the improvements shall be 
offered to the customers.  The commission shall order at least 
one public utility to establish a pilot program to make 
investments in and expenditures for energy from renewable 
resources such as solar, wind, or biomass.  The commission shall 
evaluate the program on the basis of cost-effectiveness and the 
reliability of technologies employed.  The order of the 
commission shall provide to the extent practicable for a free 
choice of contractor, qualified under the residential 
conservation services program of the department of energy, 
planning and development, for consumers participating in the 
program, by consumers participating in the program, of the 
device, method, or material 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, seller, installer, or contractor 
is duly licensed, certified, approved, or qualified, including 
under the residential conservation services program, where 
applicable.  The commission may order a utility to make an 
energy conservation improvement investment or expenditure 
whenever the commission 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 commission shall nevertheless 
insure that every public utility with operating revenues in 
excess of $50,000,000 operate one or more programs, under 
periodic review by the commission, which make significant 
investments in and expenditures for energy conservation 
improvements.  The commission shall give special consideration 
to the needs of renters and low income families and 
individuals.  Provisions of the previous sentences shall expire 
on January 1, 1993.  Investments and expenditures made pursuant 
to an order shall be treated for ratemaking purposes in the 
manner prescribed in section 216B.16, subdivision 6b.  No 
utility shall make an energy conservation improvement pursuant 
to this section to a residential building envelope unless it is 
the primary supplier of energy used for either space heating or 
cooling in the building. 
    Sec. 8.  Minnesota Statutes 1982, section 216B.241, 
subdivision 3, is amended to read: 
IMPROVEMENTS.] Any energy conservation improvement made to or 
installed in any residential building pursuant to this section, 
except systems owned by the utility and designed to turn off, 
limit, or vary the delivery of energy, shall be the exclusive 
property of the owner of the building except insofar as it is 
subjected to a security interest in favor of the utility in case 
of a loan to the building owner.  The utility shall have no 
liability for loss, damage or injury caused directly or 
indirectly by any energy conservation improvement except for 
negligence by the utility in purchase, installation, or 
modification of the product.  
    Sec. 9.  [EFFECTIVE DATE.] 
    Sections 1 to 8 are effective the day following final 
    Approved May 19, 1983

Official Publication of the State of Minnesota
Revisor of Statutes