SAN FRANCISCO – A Minnesota law banning the importation of electricity from coal-fired power plants in other states does not threaten California’s more narrowly written environmental laws largely because it has been struck down recently by both a U.S. district court and a federal appeals court.
A three-judge panel of the U.S. 8th Circuit Court of Appeals recently upheld a U.S. district court finding that the Minnesota law actually sought to control conduct beyond the state’s borders.
The law sought to prohibit new construction of coal-fired plants in Minnesota, but also barred state entities from buying power from out-of-state utilities if these purchases essentially increased Minnesota’s statewide power sector carbon dioxide emissions.
North Dakota and three electricity producing cooperatives that sell power to Minnesota utilities filed the federal court lawsuit against Beverly Heydinger, who chairs the Minnesota Public Utilities, on the grounds that the Minnesota law violated the Commerce Clause of the U.S. Constitution.
Two of the three judges on the appeals court panel agreed that the district court’s injunction against the Minnesota law should be affirmed because the Federal Power Act gives the Federal Energy Regulatory Commission, created by Congress, exclusive jurisdiction to regulate wholesale sales and the transmission of electric energy in interstate commerce.
One of the appeals court judges said that by demanding offsets or allowance purchases from a North Dakota energy facility as a condition for providing power to Minnesota customers conflicts with the regulatory scheme that Congress designed in the Clean Air Act.
That appeals court judge said that if Minnesota has concerns with emissions from its neighbors, it may seek recourse through one of the Clean Air Act’s several mechanisms that allow states to challenge emissions created by other states.
“Clearly, the U.S. Constitution gives Congress the supreme authority over commerce” among the various states, Natural Resources Defense Council (NRDC) expert Allison Clements told the Northern California Record.
“One of the judges reasoned that the Minnesota law violated the Commerce Clause because it gave Minnesota the power to control business in other states,” NRDC expert Miles Farmer told the Northern California Record.
That’s because Minnesota is in the Midcontinent Independent System Operator (MISO) power grid that provides electricity to parts of 15 states. Electricity does not stop at state borders. California is not in the MISO grid.
“California’s power plant emissions laws and its renewable energy standards are narrower in reach than the Minnesota law,” Clements said.
That is an important difference between the California set of environmental laws and the Minnesota law.
Clements and Farmer said California’s emissions performance standard, known as SB1368, establishes an emissions limit only for power plants that serve California customers and prevents state utilities from making long-term financial commitments for resources that do not meet these emissions standards.
California’s Renewable Portfolio Standard (RPS) requires that retail sellers and publicly owned utilities procure 50 percent renewable energy by 2030. Like SB1368, the RPS requirements are specifically limited to entities engaged in the retail sale of electricity to end-use customers located within California.