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Disappointment in Minnesota

A strong Renewables Portfolio Standard (RPS) passed through the Minnesota Senate in early May was watered down in conference committee after the Republican controlled House of Representatives opposed mandating a standard for renewable energy in supply portfolios without also deregulating the industry. The Senate energy bill would have required 1% of Minnesota's electricity to come from renewable energy resources by 2005, escalating by 1% a year towards a 2015 goal of 10% of electricity.

The RPS did not specifically call for all the renewables to be supplied by wind turbines. At least 0.5% was to have come from biomass by 2010, and at least 1% by 2015. Utilities could have chosen to buy tradable credits instead of owning renewables plant.

"The strong support we thought we had in the Senate weakened," says Bill Grant of the Izaak Walton League. "The author of the House bill made it clear that the mandates would only be appropriate if it included deregulation of the utilities, which it did not." Instead, the final bill sets a goal for renewables of 10% of the energy mix by 2015, but it fails to mandate compliance or set penalties. It also requires all utilities to have a green marketing tariff, something most of them in Minnesota already have, says Grant. The bill does, however, limit what utilities can charge customers when selling blocks of green electricity to the actual cost of the power.

State representative Lauren Jennings expressed disappointment at the bill's outcome and is expected, in another bill next year, to require Xcel Energy to increase its renewable energy commitment in exchange for more short term dry cask storage at its nuclear facilities. That would still leave other utilities without a minimum renewables standard, says Grant. The other possibility for a Minnesota RPS is if the state decides to deregulate electric utilities. An RPS could be attached to any new bill.

The Minnesota energy bill includes energy efficiency and modifications to the state's small scale wind tax credit, which is nearly oversubscribed. "On balance, it is better than no bill," Grant says.

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