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Office of the Revisor of Statutes

216B.243 CERTIFICATE OF NEED FOR LARGE ENERGY FACILITY.
    Subdivision 1. Assessment of need criteria. The commission shall, pursuant to chapter 14
and sections 216C.05 to 216C.30 and this section, adopt assessment of need criteria to be used in
the determination of need for large energy facilities pursuant to this section.
    Subd. 2. Certificate required. No large energy facility shall be sited or constructed in
Minnesota without the issuance of a certificate of need by the commission pursuant to sections
216C.05 to 216C.30 and this section and consistent with the criteria for assessment of need.
    Subd. 3. Showing required for construction. No proposed large energy facility shall be
certified for construction unless the applicant can show that demand for electricity cannot be met
more cost effectively through energy conservation and load-management measures and unless the
applicant has otherwise justified its need. In assessing need, the commission shall evaluate:
(1) the accuracy of the long-range energy demand forecasts on which the necessity for
the facility is based;
(2) the effect of existing or possible energy conservation programs under sections 216C.05 to
216C.30 and this section or other federal or state legislation on long-term energy demand;
(3) the relationship of the proposed facility to overall state energy needs, as described in the
most recent state energy policy and conservation report prepared under section 216C.18, or, in the
case of a high-voltage transmission line, the relationship of the proposed line to regional energy
needs, as presented in the transmission plan submitted under section 216B.2425;
(4) promotional activities that may have given rise to the demand for this facility;
(5) benefits of this facility, including its uses to protect or enhance environmental quality,
and to increase reliability of energy supply in Minnesota and the region;
(6) possible alternatives for satisfying the energy demand or transmission needs including
but not limited to potential for increased efficiency and upgrading of existing energy generation
and transmission facilities, load-management programs, and distributed generation;
(7) the policies, rules, and regulations of other state and federal agencies and local
governments;
(8) any feasible combination of energy conservation improvements, required under section
216B.241, that can (i) replace part or all of the energy to be provided by the proposed facility, and
(ii) compete with it economically;
(9) with respect to a high-voltage transmission line, the benefits of enhanced regional
reliability, access, or deliverability to the extent these factors improve the robustness of the
transmission system or lower costs for electric consumers in Minnesota;
(10) whether the applicant or applicants are in compliance with applicable provisions of
sections 216B.1691 and 216B.2425, subdivision 7, and have filed or will file by a date certain
an application for certificate of need under this section or for certification as a priority electric
transmission project under section 216B.2425 for any transmission facilities or upgrades identified
under section 216B.2425, subdivision 7;
(11) whether the applicant has made the demonstrations required under subdivision 3a; and
(12) if the applicant is proposing a nonrenewable generating plant, the applicant's assessment
of the risk of environmental costs and regulation on that proposed facility over the expected useful
life of the plant, including a proposed means of allocating costs associated with that risk.
    Subd. 3a. Use of renewable resource. The commission may not issue a certificate of
need under this section for a large energy facility that generates electric power by means
of a nonrenewable energy source, or that transmits electric power generated by means of a
nonrenewable energy source, unless the applicant for the certificate has demonstrated to the
commission's satisfaction that it has explored the possibility of generating power by means of
renewable energy sources and has demonstrated that the alternative selected is less expensive
(including environmental costs) than power generated by a renewable energy source. For purposes
of this subdivision, "renewable energy source" includes hydro, wind, solar, and geothermal energy
and the use of trees or other vegetation as fuel.
    Subd. 3b. Nuclear power plant; new construction prohibited; relicensing. (a) The
commission may not issue a certificate of need for the construction of a new nuclear-powered
electric generating plant.
(b) Any certificate of need for additional storage of spent nuclear fuel for a facility seeking a
license extension shall address the impacts of continued operations over the period for which
approval is sought.
    Subd. 4. Application for certificate; hearing. Any person proposing to construct a large
energy facility shall apply for a certificate of need and for a site or route permit under chapter
216E prior to construction of the facility. The application shall be on forms and in a manner
established by the commission. In reviewing each application the commission shall hold at least
one public hearing pursuant to chapter 14. The public hearing shall be held at a location and hour
reasonably calculated to be convenient for the public. An objective of the public hearing shall be
to obtain public opinion on the necessity of granting a certificate of need and, if a joint hearing
is held, a site or route permit. The commission shall designate a commission employee whose
duty shall be to facilitate citizen participation in the hearing process. Unless the commission
determines that a joint hearing on siting and need under this subdivision and section 216E.03,
subdivision 6
, is not feasible or more efficient, or otherwise not in the public interest, a joint
hearing under those subdivisions shall be held.
    Subd. 5. Approval, denial, or modification. Within 12 months of the submission of
an application, the commission shall approve or deny a certificate of need for the facility.
Approval or denial of the certificate shall be accompanied by a statement of the reasons for the
decision. Issuance of the certificate may be made contingent upon modifications required by
the commission. If the commission has not issued an order on the application within the 12
months provided, the commission may extend the time period upon receiving the consent of the
parties or on its own motion, for good cause, by issuing an order explaining the good cause
justification for extension.
    Subd. 6. Application fees; rules. Any application for a certificate of need shall be
accompanied by the application fee required pursuant to this subdivision. The application fee is to
be applied toward the total costs reasonably necessary to complete the evaluation of need for the
proposed facility. The maximum application fee shall be $50,000, except for an application for
an electric power generating plant as defined in section 216B.2421, subdivision 2, clause (1),
or a high-voltage transmission line as defined in section 216B.2421, subdivision 2, clause (2),
for which the maximum application fee shall be $100,000. Costs exceeding the application fee
and reasonably necessary to complete the evaluation of need for the proposed facility shall be
recovered from the applicant. If the applicant is a public utility, a cooperative electric association,
a generation and transmission cooperative electric association, a municipal power agency, a
municipal electric utility, or a transmission company, the recovery shall be done pursuant to
section 216B.62. The commission shall establish by rule pursuant to chapter 14 and sections
216C.05 to 216C.30 and this section, a schedule of fees based on the output or capacity of the
facility and the difficulty of assessment of need. Money collected in this manner shall be credited
to the general fund of the state treasury.
    Subd. 7. Participation by other agency or political subdivision. (a) Other state agencies
authorized to issue permits for siting, construction or operation of large energy facilities, and
those state agencies authorized to participate in matters before the commission involving utility
rates and adequacy of utility services, shall present their position regarding need and participate
in the public hearing process prior to the issuance or denial of a certificate of need. Issuance or
denial of certificates of need shall be the sole and exclusive prerogative of the commission and
these determinations and certificates shall be binding upon other state departments and agencies,
regional, county, and local governments and special purpose government districts except as
provided in sections 116C.01 to 116C.08 and 116D.04, subdivision 9.
(b) An applicant for a certificate of need shall notify the commissioner of agriculture if
the proposed project will impact cultivated agricultural land, as that term is defined in section
216G.01, subdivision 4. The commissioner may participate in any proceeding on the application
and advise the commission as to whether to grant the certificate of need, and the best options for
mitigating adverse impacts to agricultural lands if the certificate is granted. The Department of
Agriculture shall be the lead agency on the development of any agricultural mitigation plan
required for the project.
    Subd. 8. Exemptions. This section does not apply to:
(1) cogeneration or small power production facilities as defined in the Federal Power Act,
United States Code, title 16, section 796, paragraph (17), subparagraph (A), and paragraph (18),
subparagraph (A), and having a combined capacity at a single site of less than 80,000 kilowatts;
plants or facilities for the production of ethanol or fuel alcohol; or any case where the commission
has determined after being advised by the attorney general that its application has been preempted
by federal law;
(2) a high-voltage transmission line proposed primarily to distribute electricity to serve the
demand of a single customer at a single location, unless the applicant opts to request that the
commission determine need under this section or section 216B.2425;
(3) the upgrade to a higher voltage of an existing transmission line that serves the demand of
a single customer that primarily uses existing rights-of-way, unless the applicant opts to request
that the commission determine need under this section or section 216B.2425;
(4) a high-voltage transmission line of one mile or less required to connect a new or upgraded
substation to an existing, new, or upgraded high-voltage transmission line;
(5) conversion of the fuel source of an existing electric generating plant to using natural gas;
(6) the modification of an existing electric generating plant to increase efficiency, as long
as the capacity of the plant is not increased more than ten percent or more than 100 megawatts,
whichever is greater; or
(7) a large energy facility that (i) generates electricity from wind energy conversion systems,
(ii) will serve retail customers in Minnesota, (iii) is specifically intended to be used to meet the
renewable energy objective under section 216B.1691 or addresses a resource need identified in a
current commission-approved or commission-reviewed resource plan under section 216B.2422,
and (iv) derives at least ten percent of the total nameplate capacity of the proposed project from
one or more C-BED projects, as defined under section 216B.1612, subdivision 2, paragraph (f).
History: 1974 c 307 s 13; 1975 c 170 s 3,4; 1977 c 381 s 19; Ex1979 c 2 s 32; 1980 c 579 s
10,11; 1980 c 614 s 123; 1981 c 356 s 159,248; 1982 c 424 s 130; 1982 c 561 s 2; 1983 c 289 s
46,115 subd 2; 1984 c 558 art 4 s 10; 1984 c 655 art 1 s 22,23; 1985 c 304 s 1; 1987 c 312 art 1 s
10 subd 1; 1991 c 235 art 4 s 1; art 6 s 2; 1994 c 641 art 2 s 2; 2001 c 212 art 7 s 31-33; 2002 c
398 s 4; 1Sp2003 c 11 art 1 s 4; 2005 c 97 art 1 s 5,6; art 2 s 4; art 3 s 13-15