Sorting Out the Cost Factors Behind MN's Carbon-Free Plan
Thursday, March 2, 2023
Minnesota recently captured headlines for its approval of a new goal to reach 100% carbon-free electricity, and those tracking the effort say while investments are needed, the state is in a good position to do what is required.
The plan, recently signed into law, calls on the state's utilities to get 100% of their electricity from carbon-free sources by 2040. Many utilities were already making the transition, but some initially expressed concern about added costs.
Annie Levenson-Falk, executive director of the Citizens Utility Board of Minnesota, noted renewable-energy replacements for aging fossil-fuel infrastructure are the best way to go.
"There's no cheaper alternative," Levenson-Falk asserted. "Renewables are generally the lowest-cost way to generate electricity."
For example, the Lazard financial advisory firm said subsidized wind and solar projects are now cheaper than coal production.
Levenson-Falk acknowledged no matter the source, overall energy investments will be in the billions. But she added Minnesota utilities have already made progress in integrating renewables, making it the more attractive option. Supporters said the federal Inflation Reduction Act also will keep costs lower.
Rep. Jamie Long, DFL-Minneapolis, the House Majority Leader, authored the plan. He predicted whatever costs are passed on to consumers will be more manageable than the impact currently felt from volatile fossil-fuel markets.
"A significant part of the recent increases that we've seen in electricity prices have been from the skyrocketing natural gas prices," Long pointed out.
The Center for the American Experiment said under the plan, Minnesota customers will see their electricity expenses increase by an average of nearly $3,900 a year. But Levenson-Falk countered there are a lot of estimates being floated, which should be met with skepticism.
"I think there's a lot of misinformation out there," Levenson-Falk contended. "I would just encourage folks to look a little more carefully look at where it already is being done and the effects that it's having. And from a consumer perspective, I think this is a really great step forward for Minnesota."
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