In a literal sprint to the finish, the Minnesota legislature passed a bill, which included energy policy provisions as part of a Senate Floor Amendment, just seconds before the State constitutional deadline. Pertinent energy policy provisions were included in Article 3 of that amendment and are briefly summarized below:
- If the MN PUC orders a generating facility to terminate its operations prior to the end of that facility’s physical life, the MN PUC may assess whether to allow a utility to recover any positive net book value of that facility.
- The existing multi-year rate plan provision was revised to permit multi-year rate plan proposals up to five years in duration, during which the utility may be subject to reasonable performance measures and incentives, and as part of which the utility may propose: (1) recovery of its forecasted rate base; (2) recovery of O&M expenses; (3) tariffs that expand the products and services available to customers, including an affordability rate for low-income customers; and (4) MN PUC-approved adjustments for changes the MN PUC determines are just and reasonable, including changes in the utility’s cost of operating its nuclear facilities.
- Utilities operating under a multi-year rate plan must engage in distribution system planning to (i) identify in a report those investments that are necessary to modernize the grid, enhance reliability, improve security against cyber and physical threats, and increase energy conservation; and (ii) identify in a study the interconnection points on its distribution system that are available for small-scale distributed generation resources and identify any necessary upgrades. The utility may recover the costs associated with this planning and any investments incident thereto.
- Utilities may petition the MN PUC for recovery of natural gas extension projects outside of a general rate case.
- Net metered customers of a cooperative electric association or a municipal utility may be subject to additional fixed charges.
- To achieve the policy objective of ensuring competitive electric rates for energy-intensive trade-exposed customers, certain utilities have the flexibility to offer those customers various rate options, including fixed rates, market-based rates, and rates to encourage utilization of new clean energy technology.
Although not endorsed by all members of the Minnesota e21 Initiative, the concepts in the provisions related to the multi-year rate plan, distribution planning, and energy-intensive trade-exposed rate options were raised in the e21 Report.