Enabling a rapid clean energy transformation in Minnesota

Decades of deliberate efforts to transform the state’s electric segment are bearing fruit in Minnesota with utilities, advocates and industry practitioners alike pleasantly surprised by the state’s progress in the past year. Find out what benefits the state expects to gain from renewables.

When most people think of the U.S. renewable energy leadership, they tend to point to states such as California. However, other states are quietly achieving their own lofty renewable energy goals outside the limelight.

Minnesota – where solar energy is seeing a second consecutive year of strong growth and utilities are on track to exceed the state’s Renewable Energy Standard ahead of schedule – is one such state. Careful planning towards renewable energy going back 20 years, along with decreased costs for renewables, is beginning to bear fruit.

Reaping the benefits of planning ahead

The Great Plains Institute’s Senior Program Director, Brian Ross, points to energy utilities’ views on renewables as clear evidence of the importance of making forward-looking decisions to affect future change.

“Just a few years ago, we weren’t seeing utility executives saying the things they routinely say today in favour of renewable energy,” he points out, “but steady progress towards dispelling utilities’ concerns about energy intermittency in renewable-based systems and decreasing costs for renewables have changed the picture dramatically.”

The utilities themselves confirm this view: in 2018, Xcel Energy’s CEO said the company could build a new wind farm and operate it more cheaply than it could operate the marginal costs of its existing coal plants. At that point, Ross argues, significant renewable energy growth becomes an “inevitability,” since shareholder interests in keeping investor-owned utilities’ costs down and society’s interest in decarbonisation are aligned, making renewables the primary sensible path forward.

However, all the planning in the world couldn’t make renewable energy cheaper than traditional generation without decreasing renewable costs. Josh Klopp, Business Development Manager Wärtsilä North America, cites solar energy as an example of lower costs’ effects. Even a year ago, solar costs were too high for some utilities, so it was underutilised. Because PV cell costs have dropped substantially in the past 12–18 months, more companies have been able to offer community solar gardens, and Minnesota now has ~1,100 MW of solar installed across the state, with another ~3,000 MW of solar coming from new projects by 2030.

Unsettled debates and open questions

However, Minnesota still has numerous choices to make about its clean energy future. While Governor Tim Walz has proposed pursuing 100% carbon-free energy by 2050, industry players are advocating for a path to 100, meaning 100% renewables but allowing for the continued use of dispatchable thermal assets that operate on renewable synthetic fuel.

Klopp points out that with technology available today utilities can and have achieved 70% to 80% renewable generation but achieving the final 20% to 30% of electricity generation with renewables is where it gets challenging. A task that will be made even more difficult if all, but carbon-free electricity generation operations are eliminated.

There are also ongoing debates about how best to deploy renewable energy, with increasing pushback from communities that see wind farms as transforming their communities’ characteristics for the worse and ongoing debate about whether it’s better to build large scale solar systems or on homes via solar panels. Overall, Ross observes that the conversation around energy deployment is evolving from mere implementation to seeking to low-impact deployments that minimise impacts to communities and the natural environment while maximising economic benefits.

Benefits for all

Finally, there are still open questions about how utilities will ensure that energy remains reliable, affordable and flexible as more coal units retired and more renewable energy comes online. Klopp argues that as this transition happens, “utilities are going to need a new, more flexible tool to ensure consistent energy delivery,” likely in the form of energy storage and fast response technology.

Regardless of how Minnesota pursues its renewable energy goals, Klopp sounds an optimistic note about industry’s role in ensuring a better future: “Sometimes, those working in the power industry get a bad reputation as far as the environment goes, but everyone I’ve worked with in the industry is invested in a better future.”

Written by

Lorelei Yang
Contributing Writer at Spoon Agency