Prevailing wage would become part of renewable energy projects under bill

Is the move toward renewable energy in Minnesota a good use of taxpayer dollars? That’s actually a tricky question, because much of the transition to renewable energy is not being funded by taxpayers, but by Xcel Energy. And some legislators are quick to point out that Xcel customers are the ones who ultimately foot the bill.

But the state is responsible for meting out the funds collected from Xcel for the Renewable Development Account. That’s a fund set up in 1994 when Xcel was given permission to store nuclear waste at its Prairie Island plant in southeastern Minnesota. Storage at its Monticello plant was added in 2007. For each waste cask used, Xcel gives the state between $350,000 and $500,000 annually.

The fund is earmarked for grants for the development of renewable energy sources in Minnesota.

Which raises a question: Should workers building solar and wind energy systems and electric vehicle infrastructure paid for by the Renewable Development Account follow the same “prevailing wage” dictates as state-funded construction projects.

Rep. Jerry Newton (DFL-Coon Rapids) thinks they should.

That’s why he’s sponsoring HF826, a bill that, as amended, would add to the section of state law on the Renewable Development Account a sentence saying that a construction project funded in whole or in part by the account would be subject to the same prevailing wage laws as state-funded construction projects.

On Wednesday, the House Climate and Energy Finance and Policy Committee approved the bill 14-3 and sent it to the House Labor and Industry Finance and Policy Committee.

A prevailing wage is the hourly rate, plus benefits, required by law to be paid to each trade worker while performing work on state-funded construction projects. Its levels are determined by the state’s Department of Labor and Industry.

“Almost every renewable energy project and incentive program proposed has a Renewable Development Account spending mechanism,” said Andy Snope, legislative and political director for the International Brotherhood of Electrical Workers Local 292. “The RDA walks and talks like General Fund money spending. And, for that reason, we think that this is long overdue for the fund to carry the same public works wage and hour policy that comes with General Fund spending.”

Rep. Chris Swedzinski (R-Ghent) suggested that increased labor costs as a result of the legislation might result in fewer projects being funded.