5.3. ERMUSR 02-12-2008 - Laserfiche WebLink

Home Browse Search

M1-: ~~ Position Statement Minnesota Municipa/ Uti/ities Association Federal Incentives for Renewable Energy With last year's passage of Minnesota's aggressive renewable energy standard (RES), federal support for renewable development by Minnesota municipal utilities is more essential than ever before. Two federal issues important to Minnesota municipal utilities should be addressed in any energy legislation passed by Congress. They are Clean Renewable Energy Bonds (CREBs) and the Renewable Energy Production Incentive (KEPI). Unfortunately, only the KEPI program was reauthorized by Congress last year; CREBs was dropped from inclusion in the new energy bill, as part of the energy tax title. Accordingly, we urge Congress to pass a new energy tax title in 2008. Minnesota municipal utilities have long embraced the use of renewable generation to meet the electric energy needs of their communities. They have been motivated by the need to secure wholesale power that will result in reliable and reasonably priced service to their customers. It was for that reason, more than 50 years ago, that municipal utilities in western Minnesota began making commitments to purchase wholesale power from federal hydroelectric dams at a time when power from conventional sources would have been less expensive and, it seemed, possibly even more reliable. It is with this same sense of responsibility that municipal utilities are approaching the effort to develop wind and other renewables in order to meet a portion of their electricity needs. Last year Minnesota enacted the most comprehensive renewable energy standard (RES) law in the United States. Patterned after a comprehensive proposal developed by the Minnesota Municipal Utilities Association (MMUA) and passed with the support of both utilities and environmentalists, the new law: • Requires investor-owned utilities*, generation & transmission cooperatives and municipal power agencies to produce 7% of their electricity from renewable resources by the year 2010, 12% by 2012, 17% by 2016, 20% by 2020 and 25% by 2025. (*Xcel must produce 30% by 2020.) • Connects Minnesota with neighboring states in a renewable energy credit trading system so that energy from wind turbines, landfills, biomass plants and other renewable sources can be shared and sited in optimal locations. • Phases out the current green pricing requirement in the law, which requires utilities to provide electricity from renewable sources to customers who request such service. A green pricing mandate is no longer necessary, given the aggressive implementation schedule of the RES. Not surprisingly, power from renewable resources and advanced technologies continues to be more expensive than power from traditional generation sources. Federal investment Minnesota Municipal Utilities Association February 2008