MN wind and solar mandate would mean costly grid upgrade

By Tom Steward | Watchdog Minnesota Bureau

A new report released by the Minnesota Commerce Department lays the technical groundwork for ramping up one of the nation’s highest state renewable energy mandates from 30 to 40 percent by 2030.

One technicality left out of the $750,000 study underwritten by Minnesota utility ratepayers? Who pays for what in a potentially massive upgrade of high voltage transmission lines from the Dakotas to Indiana.

“The results indicate that Minnesota’s renewable energy standard is clearly on track and that the capacity for adding additional wind and solar up to 40% by 2030 can be reliably accommodated by the electric power system,” according to a Minnesota Commerce Department news release.

A search of the 178-page report shows the authors never mention ratepayers, leaving unanswered whether spending nearly $400 million to upgrade the grid would be a good investment for Minnesota consumers and employers.

“It doesn’t say it would be cost effective to upgrade the system to accommodate 40 percent renewables. It doesn’t say it would be a good idea,” said Bill Glahn, an independent energy analyst for Piedmont Consulting and a former Pawlenty administration energy official. “It just said that given enough time and money, it’s technically feasible. I could have told you that.”

Minnesota utilities and transmission line companies selected General Electric Energy Consulting to conduct the analysis ordered by the 2013 Minnesota Legislature. GE is a major manufacturer and supplier of wind turbines and solar infrastructure, but state officials said there were no conflict of interest concerns on their part.

“GE Consulting is a separate business operating independently of GE. The study was overseen by the project Technical Review Committee made up of utility engineers and national experts who reviewed all inputs and outputs from the analyses. As you may know, GE has business interests that span almost all forms of electric generation,” stated Commerce Department staff in an email response to Watchdog Minnesota Bureau.

Despite the intermittent nature of wind and solar power, the analysis makes the case the transmission grid can be made to accommodate higher levels of renewable energy, given enough time and investment. However, the state’s generation mix would still feature existing resources, including nuclear, coal and natural gas power plants to provide reliable, around the clock service to the state’s consumers.

“With upgrades to existing transmission, the power system can be successfully operated for all hours of the year (no unserved load, no reserve violations, and minimal curtailment of renewable energy) with wind and solar resources increased to achieve 40 percent renewable energy in Minnesota,” said Commerce Department Deputy Commissioner Bill Grant in an overview of the report.

Critics say the state got it backwards, generating a technical report for an energy policy that doesn’t yet exist and may not be economically feasible, at ratepayers’ expense.

“They should be asking whether it’s a good idea before they spend money on figuring out how to get it done,” said Glahn, who preceded Grant at the state Commerce Department. “And with consumers and employers in the state already trying to figure out how they’re going to pay their energy bills, even the study money could have been better used elsewhere.”

To reach higher levels of renewable energy sources on the power grid, the level of investment would need to increase exponentially. The report estimates a cost of more than $2.5 billion to upgrade transmission systems to accommodate a 50 percent renewable energy mandate in Minnesota.

“Detailed engineering studies identifying specific costs of each upgrade would need to be performed. In most cases, such projects would then require regulatory review and approval before ratepayers could be assessed,” said a Commerce Department email.