Committee advances bill to make clean energy law exception for out-of-state electricity

Could North Dakota sue Minnesota?

Our neighbor to the west is threatening to do just that. And it’s all because of Minnesota’s move toward carbon-free electricity.

On Feb. 26, North Dakota’s governor, Kelly Armstrong, sent a letter to Gov. Tim Walz expressing concern about Minnesota’s 100% clean energy standards signed into law in 2023.

“By requiring utilities selling power to retail customers in Minnesota to generate exclusively from ‘carbon-free energy technologies’ by 2040, this legislation may inadvertently regulate energy production beyond Minnesota’s borders,” she wrote.

Armstrong suggested that this was unconstitutional.

“To avoid another costly and divisive legal battle, I respectfully request Minnesota adopt clarifying language in the 2025 legislative session to ensure the carbon-free mandate solely applies to electricity generation within Minnesota’s own borders,” the letter said.

Such is the genesis of HF787, a bill sponsored by Rep. Paul Anderson (R-Starbuck) that would do precisely as Gov. Armstrong requested.

As amended during Tuesday’s meeting of the House Energy Finance and Policy Committee, it would change the language in statute about the mandatory targets that electric utilities must meet with respect to the proportion of their energy generated or procured from carbon-free sources to say that it applies only to sources generated within the state of Minnesota.

The committee approved the bill on an 8-7 party-line vote and sent it to the House floor.

“HF787 ensures that our policy remains focused on electricity generation within Minnesota’s borders and doesn’t attempt to regulate power plants in neighboring states,” Anderson said.

“Minnesota did lose a case,” Anderson said of the decision in North Dakota v. Heydinger, in which a circuit judge found that some provisions of the Minnesota Next Generation Energy Act violated the U.S. Constitution’s Dormant Commerce Clause. “$1.3 million in court costs.”

But Rep. Athena Hollins (DFL-St. Paul) believes Minnesota’s law will hold up in court.

“This law was crafted specifically to avoid being the subject of lawsuits,” Hollins said. “It’s been a couple of years now, and there hasn’t been a lawsuit, not that I’m inviting one.”

Both Hollins and Rep. Larry Kraft (DFL-St. Louis Park) said several states have signed carbon-free energy standards into law without them being declared unconstitutional.

“The threats of a lawsuit are just that,” said Rep. Patty Acomb (DFL-Minnetonka). “When we talk about new industries coming to Minnesota — data centers, for example — one of the reasons they’re coming here is because of our policies on clean energy.”

“From our perspective, there is no need for this legislation,” said Sam Smith, government relations director for the Commerce Department.