Counties and cities in Minnesota can now get into the business of generating wind energy.
Renville County Commissioner Bob Fox and other officials from rural and metropolitan governments pushed for the new authority this session.
Gov. Tim Pawlenty signed the bill Tuesday despite objections from some in his GOP party that the legislation would allow the state to be too involved in private business matters.
Fox, whose central Minnesota county is doing a study to determine its potential for wind-energy development, said that investors are interested in building wind turbines in his area – and that the new policy approved by Pawlenty would allow Renville and other counties to partner with wind energy investors.
“We did not have the right as a county to do this before. That was our first step to have this authority,” said Fox, a member of the Rural Minnesota Energy Board, which consists of 17 counties in southern and western Minnesota.
The Metropolitan Energy Policy Coalition, which consists of seven metropolitan counties and the Metropolitan Council, also advocated for the legislation.
Sen. Gary Kubly, DFL-Granite Falls, and Rep. Lyle Koenen, DFL-Clara City, sponsored the legislation.
Kubly said local units of government that build wind turbines will be able to sell power wholesale to utilities or sell retail power to residents. The new law will help Minnesota meet state requirements that electric utilities generate 25 percent of their power from renewable sources by 2025.
“I think it will help the utilities meet their mandate in addition to allowing local units of government to save money,” Kubly said.
The bill sparked controversy in the House and Senate before Pawlenty signed it. The House passed the measure 95-35. The Senate passed it 53-10.
Sen. David Hann, R-Eden Prairie, voted against the bill. He questioned if government should get involved in the marketplace for wind energy.
“If things are really economically advantageous, you don’t need to spend taxpayer money to make it happen,” Hann said in an interview.
Kubly, however, said developing wind energy will benefit Minnesotans. Moreover, wind can be obtained for free, while other energy sources such as coal can only be gotten for a price.
“The cost of wind will still be nothing. … I think it is going to save the taxpayers’ money,” Kubly said.
The bill received several hearings this session in House and Senate committees. Among the changes made during the legislative process, lawmakers inserted a provision that would deny local governments from using eminent domain to take land on which to build a turbine. Kubly said that most cities own land on the outskirts of their boundaries that tend to be good locations for a turbine or two.
Fox noted that investors of smaller community-based energy development (C-BED) projects are limited to a 15 percent stake in a single project. But he said the new law is useful because a county could chip in for a portion of the project if necessary.
A separate bill moving through the Legislature at the end of session would help finance local energy projects. The bill, which was waiting for a vote in the House and Senate on Friday, was sponsored by Rep. Jeremy Kalin, DFL-Lindstrom, and Sen. Scott Dibble, DFL-Minneapolis.
The bill would provide financing to help local units of government obtain the engineering and other services needed to do renewable energy projects. The financing is called a tax-exempt lease purchase agreement. Kalin said the proposal would provide financial assistance to local governments who want to do wind and conservation projects.
“The lease purchase, I like to describe it, is a ‘funded unmandate,’ ” Kalin said.
Fox said government officials still have more work to do to provide wind energy incentives.
Federal tax policy, in particular, needs to be changed in order to provide better incentives for renewable energy, Fox said. But he added that Minnesota’s wind-energy potential should be pursued in the face of rising energy costs.
“We’re going to have to do something different. Our demand curve for energy keeps going up,” Fox said.
by Charley Shaw
16 May 2008
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