Minnesota on Oct. 5 released a 2025 Energy Action Plan that lays a path for Minnesota to meet or exceed its renewable energy and energy efficiency goals, while boosting the state’s economy.
Minnesota currently imports 72% of the energy it consumes, mostly fossil fuels such as coal and oil. The new report recommends ways to leverage opportunities over the next decade to reduce this dependence and increase Minnesota’s use of clean, affordable, reliable and resilient energy.
“The bipartisan work of Governor [Tim] Pawlenty and the Legislature in 2007 shows Minnesota can work across party lines to reduce carbon emissions and increase renewable energy use, without sacrificing reliability or cost effectiveness,” said Lt. Gov. Tina Smith. “The 2025 Energy Action Plan continues this work, and outlines the path to meeting our long-term renewable energy and emission reduction goals. I look forward to working with stakeholders and the Legislature next year to build an energy future that is good for our environment, health, and economy.”
“Minnesota has long been a leader in innovative energy policies,” said Minnesota Commerce Commissioner Mike Rothman, whose agency serves as the state energy office. “Our state is poised to extend that leadership, as the 2025 Action Plan provides a roadmap to continue moving forward on the state’s renewable energy and energy efficiency goals. It is a strategy that will create jobs, strengthen our economy and reduce pollution that threatens the environment and people’s health.”
The Action Plan is the result of a two-year project funded by a competitive grant awarded by the U.S. Department of Energy.
Minnesota’s energy landscape has changed dramatically in the past decade, the report notes. The state’s coal-fired electricity dropped to 44% in 2015 from 62% in 2005, while electricity generated from renewable energy increased to 21% in 2015, compared to just 6% a decade earlier. That puts Minnesota well on pace to exceed its Renewable Electricity Standard of generating 25% of the state’s electricity from renewables by 2025.
The 2025 Energy Action Plan charts strategies for continued clean energy growth over the next decade. Strategies are recommended under five categories: transportation; energy supply and grid modernization; efficient buildings and integrated energy systems; industrial and agricultural processes; and local planning and action.
“What really sets the 2025 Energy Action Plan apart from other energy planning efforts is the stakeholder-driven approach that identifies actionable steps to enable key energy strategies and technologies over the next 10 years,” said Stephen Doig, Managing Director for the Rocky Mountain Institute, which prepared the report.
The project was coordinated by staff from the Rocky Mountain Institute, Minnesota Commerce Department, Minnesota Legislative Energy Commission, Great Plains Institute and LHB Inc. The project team worked closely with a multidisciplinary group of more than 50 stakeholders across the state to collect input on energy technologies and strategies.
A webinar to provide an overview of the 2025 Energy Action Plan and discuss next steps will be held on Oct. 12.
Within the electricity sector, renewables make up a large and growing share of total energy used to produce electricity, accounting for 21 percent of annual generation in Minnesota in 2015. In addition to electricity generated in-state, electricity imports from neighboring states and Canada account for approximately 26% of the electricity used in the state.
The report added that federal legislation and regulations are further shaping the market for renewable energy. In December 2015, Congress voted to extend the 30% investment tax credit (ITC) for solar PV and the Production Tax Credit (PTC) for wind energy. The bill also extends a tax credit for biodiesel and biodiesel mixtures and the tax credit for small agribusiness producers, making investments in biofuels, wind, and solar more favorable.
Concurrently, a number of federal regulations, most notably the EPA’s Mercury and Toxic Air Standards (MATS), are making the operation of old coal-fired power plants less economical and accelerating plant retirement. In addition, the EPA’s Clean Power Plan, which is under court review and aims to reduce carbon emissions from the power sector 32% below 2005 levels by 2030, is expected to have a significant impact on coal generation. Though the U.S. Supreme Court has issued a stay on implementation of the Clean Power Plan, many states, including Minnesota, are on track to comply with the regulation. Going forward, the status of the Clean Power Plan is uncertain: it could be changed or struck down by the courts, Congress, or a new presidential administration, the report said.