Base-Load Energy and Capacity

Issue

What policy changes are needed to allow Minnesota to prepare for and meet future base-load electricity demand so the development and growth of our economy is not hindered by a lack of competitively priced, reliable electricity?

Policy

• Remove the outdated ban on issuing a Certificate of Need for a new nuclear power facility

• Address the question of long-term storage of waste as best we can as a state without waiting for Congress to resolve the issue.
  
  
  • The Legislature should make recycling of spent nuclear fuel legal in Minnesota. While an act of Congress is likely necessary to provide the proper legal incentive to adopt recycling of spent fuel, states should lead by encouraging the practice.
    
    
  • When it removes the ban on new nuclear generation, the Legislature also should pass a resolution urging Congress to fully fund the development of a long-term waste storage facility at Nevada’s Yucca Mountain or an alternative facility, and encourage a national nuclear waste recycling/reprocessing program.
    
    
  • The Legislature should use whatever leverage it has, by virtue of Minnesotans’ contributions to the Nuclear Waste Fund, to convince Congress to act.
    
    
• Remove the requirement for legislative oversight for Certificates of Need related to additional storage of spent nuclear fuel.

• Repeal Minnesota’s prohibition on constructing, importing or purchasing generation which contributes to statewide power sector carbon emissions.

• Create no new restrictions on the types of electricity generating technology which may be considered and potentially used to meet demonstrated need for base-load generation.

Business Impact

Electricity infrastructure is linked to the development and growth of our economy. Two major factors affect the rate of growth: first, the development and proliferation of electricity-powered equipment and devices; and second, the overall rate of economic growth. Clearly, the two factors are linked; however, even in a weak economy demand can and does grow. The growth may be more industry and location specific, making it harder, but still important to plan for and serve.

Maintaining a reliable and competitively priced supply of electricity becomes even more complicated when utilities factor in Minnesota’s laws increasing conservation targets and mandating major investments in renewable energy.

Current economic conditions and recent Minnesota energy legislation do not mean that our state will never need additional base-load electricity – i.e. power generated by plants that run 24 hours a day, seven days a week. The central questions are the following:

1. When – not if – will more capacity be needed?
   
   
2. What technology will give us the most reliable and competitively priced power?
   
   
3. How soon do we need to start the process for adding capacity in order to make sure new generation is online when the economy requires it?

Minnesota is among a minority of states in the country that currently bans new nuclear energy. This policy, in concert with other state policies including a moratorium on greenhouse gas-emitting resources, effectively limits new base-load resource options to natural gas-based generation while exposing customers to an expensive, volatile regional market. Eliminating Minnesota’s outdated nuclear ban would give customers a clean, safe, reliable option to fill the eventual need for new power with a technology that doesn’t contribute to global climate change.

Any serious attempt by the Legislature to address Minnesota’s contribution to climate change must include the possibility of new nuclear generation in our base-load energy profile. Without this option, meeting the state’s greenhouse gas reduction goals will be much more difficult, if not impossible.