New Law: Ratepayers and utilities policies

An omnibus energy policy law ends a renewable development grant program this year and requires the Public Utilities Commission to evaluate spent nuclear fuel storage costs for the next 200 years. The law also repeals a utility’s ability to incrementally increase consumer rates based on natural gas usage amounts.

The Initiative for Renewable Energy and the Environment’s $5 million grant program, which was set to expire next year, will instead sunset July 1, 2011. IREE provides grants to the University of Minnesota and at rural campuses and experiment stations for research and development of renewable energy technologies.

Recognizing that the failure of the federal government to establish a national site for the disposal of spent nuclear fuel may result in that material remaining stored at reactor sites for an extended period of time, the law requires Xcel Energy to estimate the impacts on ratepayers if the spent fuel stays in Minnesota for 60, 100, and 200 years after the reactors shut down. In its triennial review of Xcel’s required plan describing the amount of funds it is setting aside for eventual decommissioning of its Monticello and Prairie Island nuclear plants, the commission is now required to evaluate the costs storing the spent fuel imposes on the state and the community in which it is located. The commission is required to submit a report to the Legislature that explains its funding decisions regarding decommissioning and any progress made by the federal government to remove spent nuclear fuel from the state.

Another measure revokes a utility’s ability to charge inverted block rates, which are intended to encourage energy conservation by incrementally increasing consumer rates as usage increases.

Sponsored by Rep. Mike Beard (R-Shakopee) and Sen. Julie Rosen (R-Fairmont), the other key provisions include:

• enabling a utility to propose a multi-year rate plan for up to three years beginning May 31, 2012 (effective May 28, 2011);

• eliminating the Energy Intervention Office and the position of reliability administrator within the Commerce Department and giving the department more flexibility to reallocate a $1 million appropriation for the former administrator (effective July 1, 2011); and

• allowing a utility to electronically notify customers of their rights and responsibilities with respect to the state’s Cold Weather Rule that prohibits winter disconnections under certain conditions (effective May 28, 2011).

HF1025/ SF1197*/CH97