2007 Minnesota Statutes

216B.1691 RENEWABLE ENERGY OBJECTIVES.
    Subdivision 1. Definitions. (a) Unless otherwise specified in law, "eligible energy
technology" means an energy technology that generates electricity from the following renewable
energy sources: (1) solar; (2) wind; (3) hydroelectric with a capacity of less than 100 megawatts;
(4) hydrogen, provided that after January 1, 2010, the hydrogen must be generated from the
resources listed in this clause; or (5) biomass, which includes, without limitation, landfill gas, an
anaerobic digester system, and an energy recovery facility used to capture the heat value of mixed
municipal solid waste or refuse-derived fuel from mixed municipal solid waste as a primary fuel.
    (b) "Electric utility" means a public utility providing electric service, a generation and
transmission cooperative electric association, a municipal power agency, or a power district.
    (c) "Total retail electric sales" means the kilowatt-hours of electricity sold in a year by an
electric utility to retail customers of the electric utility or to a distribution utility for distribution to
the retail customers of the distribution utility.
    Subd. 2. Eligible energy objectives. Each electric utility shall make a good faith effort to
generate or procure sufficient electricity generated by an eligible energy technology to provide
its retail consumers, or the retail customers of a distribution utility to which the electric utility
provides wholesale electric service, so that commencing in 2005, at least one percent of the
electric utility's total retail electric sales to retail customers in Minnesota is generated by eligible
energy technologies and seven percent of the electric utility's total retail electric sales to retail
customers in Minnesota by 2010 is generated by eligible energy technologies.
    Subd. 2a. Eligible energy technology standard. (a) Except as provided in paragraph (b),
each electric utility shall generate or procure sufficient electricity generated by an eligible energy
technology to provide its retail customers in Minnesota, or the retail customers of a distribution
utility to which the electric utility provides wholesale electric service, so that at least the following
standard percentages of the electric utility's total retail electric sales to retail customers in
Minnesota are generated by eligible energy technologies by the end of the year indicated:

(1)	2012	12 percent
(2)	2016	17 percent
(3)	2020	20 percent
(4)	2025	25 percent.

    (b) An electric utility that owned a nuclear generating facility as of January 1, 2007, must
meet the requirements of this paragraph rather than paragraph (a). An electric utility subject to
this paragraph must generate or procure sufficient electricity generated by an eligible energy
technology to provide its retail customers in Minnesota or the retail customer of a distribution
utility to which the electric utility provides wholesale electric service so that at least the following
percentages of the electric utility's total retail electric sales to retail customers in Minnesota are
generated by eligible energy technologies by the end of the year indicated:

(1)	2010	15 percent
(2)	2012	18 percent
(3)	2016	25 percent
(4)	2020	30 percent.

Of the 30 percent in 2020, at least 25 percent must be generated by wind energy conversion
systems and the remaining five percent by other eligible energy technology.
    Subd. 2b. Modification or delay of standard. (a) The commission shall modify or delay the
implementation of a standard obligation, in whole or in part, if the commission determines it is in
the public interest to do so. The commission, when requested to modify or delay implementation
of a standard, must consider:
(1) the impact of implementing the standard on its customers' utility costs, including the
economic and competitive pressure on the utility's customers;
(2) the effects of implementing the standard on the reliability of the electric system;
(3) technical advances or technical concerns;
(4) delays in acquiring sites or routes due to rejection or delays of necessary siting or other
permitting approvals;
(5) delays, cancellations, or nondelivery of necessary equipment for construction or
commercial operation of an eligible energy technology facility;
(6) transmission constraints preventing delivery of service; and
(7) other statutory obligations imposed on the commission or a utility.
The commission may modify or delay implementation of a standard obligation under clauses (1)
to (3) only if it finds implementation would cause significant rate impact, requires significant
measures to address reliability, or raises significant technical issues. The commission may modify
or delay implementation of a standard obligation under clauses (4) to (6) only if it finds that the
circumstances described in those clauses were due to circumstances beyond an electric utility's
control and make compliance not feasible.
    (b) When considering whether to delay or modify implementation of a standard obligation,
the commission must give due consideration to a preference for electric generation through use of
eligible energy technology and to the achievement of the standards set by this section.
(c) An electric utility requesting a modification or delay in the implementation of a standard
must file a plan to comply with its standard obligation in the same proceeding that it is requesting
the delay.
    Subd. 2c. Use of integrated resource planning process. The commission may exercise its
authority under subdivision 2b to modify or delay implementation of a standard obligation as
part of an integrated resource planning proceeding under section 216B.2422. The commission's
authority must be exercised according to subdivision 2b. The order to delay or modify shall not be
considered advisory with respect to any electric utility. This subdivision is in addition to and does
not limit the commission's authority to modify or delay implementation of a standard obligation
in other proceedings before the commission.
    Subd. 2d. Commission order. The commission shall issue necessary orders detailing the
criteria and standards by which it will measure an electric utility's efforts to meet the renewable
energy objectives of subdivision 2 to determine whether the utility is making the required good
faith effort. In this order, the commission shall include criteria and standards that protect against
undesirable impacts on the reliability of the utility's system and economic impacts on the utility's
ratepayers and that consider technical feasibility.
    Subd. 3. Utility plans filed with commission. (a) Each electric utility shall report on its
plans, activities, and progress with regard to the objectives and standards of this section in its
filings under section 216B.2422 or in a separate report submitted to the commission every two
years, whichever is more frequent, demonstrating to the commission the utility's effort to comply
with this section. In its resource plan or a separate report, each electric utility shall provide a
description of:
    (1) the status of the utility's renewable energy mix relative to the objective and standards;
    (2) efforts taken to meet the objective and standards;
    (3) any obstacles encountered or anticipated in meeting the objective or standards; and
    (4) potential solutions to the obstacles.
    (b) The commissioner shall compile the information provided to the commission under
paragraph (a), and report to the chairs of the house of representatives and senate committees with
jurisdiction over energy and environment policy issues as to the progress of utilities in the state,
including the progress of each individual electric utility, in increasing the amount of renewable
energy provided to retail customers, with any recommendations for regulatory or legislative
action, by January 15 of each odd-numbered year.
    Subd. 4. Renewable energy credits. (a) To facilitate compliance with this section, the
commission, by rule or order, shall establish by January 1, 2008, a program for tradable renewable
energy credits for electricity generated by eligible energy technology. The credits must represent
energy produced by an eligible energy technology, as defined in subdivision 1. Each kilowatt-hour
of renewable energy credits must be treated the same as a kilowatt-hour of eligible energy
technology generated or procured by an electric utility if it is produced by an eligible energy
technology. The program must permit a credit to be used only once. The program must treat all
eligible energy technology equally and shall not give more or less credit to energy based on the
state where the energy was generated or the technology with which the energy was generated.
The commission must determine the period in which the credits may be used for purposes of the
program.
    (b) In lieu of generating or procuring energy directly to satisfy the eligible energy technology
objective or standard of this section, an electric utility may utilize renewable energy credits
allowed under the program to satisfy the objective or standard.
    (c) The commission shall facilitate the trading of renewable energy credits between states.
    (d) The commission shall require all electric utilities to participate in a commission-approved
credit-tracking system or systems. Once a credit-tracking system is in operation, the commission
shall issue an order establishing protocols for trading credits.
(e) An electric utility subject to subdivision 2a, paragraph (b), may not sell renewable energy
credits to an electric utility subject to subdivision 2a, paragraph (a), until 2021.
    Subd. 5. Technology based on fuel combustion. (a) Electricity produced by fuel combustion
through fuel blending or co-firing under paragraph (b) may only count toward a utility's objectives
or standards if the generation facility:
    (1) was constructed in compliance with new source performance standards promulgated
under the federal Clean Air Act for a generation facility of that type; or
    (2) employs the maximum achievable or best available control technology available for a
generation facility of that type.
    (b) An eligible energy technology may blend or co-fire a fuel listed in subdivision 1,
paragraph (a), clause (5), with other fuels in the generation facility, but only the percentage of
electricity that is attributable to a fuel listed in that clause can be counted toward an electric
utility's renewable energy objectives.
    Subd. 6. [Repealed by amendment, 2007 c 3 s 1]
    Subd. 7. Compliance. The commission must regularly investigate whether an electric utility
is in compliance with its good-faith objective under subdivision 2 and standard obligation
under subdivision 2a. If the commission finds noncompliance, it may order the electric utility to
construct facilities, purchase energy generated by eligible energy technology, purchase renewable
energy credits, or engage in other activities to achieve compliance. If an electric utility fails to
comply with an order under this subdivision, the commission may impose a financial penalty
on the electric utility in an amount not to exceed the estimated cost of the electric utility to
achieve compliance. The penalty may not exceed the lesser of the cost of constructing facilities
or purchasing credits. The commission must deposit financial penalties imposed under this
subdivision in the energy and conservation account established in the special revenue fund under
section 216B.241, subdivision 2a. This subdivision is in addition to and does not limit any other
authority of the commission to enforce this section.
    Subd. 8. Relation to other law. This section does not limit the authority of the commission
under any other law, including, without limitation, sections 216B.2422 and 216B.243.
    Subd. 9. Local benefits. The commission shall take all reasonable actions within its
statutory authority to ensure this section is implemented to maximize benefits to Minnesota
citizens, balancing factors such as local ownership of or participation in energy production,
development and ownership of eligible energy technology facilities by independent power
producers, Minnesota utility ownership of eligible energy technology facilities, the costs of energy
generation to satisfy the renewable standard, and the reliability of electric service to Minnesotans.
    Subd. 10. Utility acquisition of resources. A competitive resource acquisition process
established by the commission prior to June 1, 2007, shall not apply to a utility for the
construction, ownership, and operation of generation facilities used to satisfy the requirements
of this section unless, upon a finding that it is in the public interest, the commission issues an
order on or after June 1, 2007, that requires compliance by a utility with a competitive resource
acquisition process. A utility that owns a nuclear generation facility and intends to construct, own,
or operate facilities under this section shall file with the commission on or before March 1,
2008, a renewable energy plan setting forth the manner in which the utility proposes to meet the
requirements of this section, including a proposed schedule for purchasing renewable energy from
C-BED and non-C-BED projects. The utility shall update the plan as necessary in its filing under
section 216B.2422. The commission shall approve the plan unless it determines, after public
hearing and comment, that the plan is not in the public interest. As part of its determination of
public interest, the commission shall consider the plan's allocation of projects among C-BED,
non-C-BED, and utility-owned projects, balancing the state's interest in:
    (1) promoting the policy of economic development in rural areas through the development
of renewable energy projects, as expressed in subdivision 9;
    (2) maintaining the reliability of the state's electric power grid; and
    (3) minimizing cost impacts on ratepayers.
History: 2001 c 212 art 8 s 3; 2002 c 398 s 3; 1Sp2003 c 11 art 2 s 3; 2007 c 3 s 1; 2007 c
136 art 4 s 10; art 6 s 1,2