North Dakota officials led by Republican Gov. Doug Burgum and leaders in the state's coal industry are pushing for carbon capture and storage to qualify as an eligible technology under Minnesota’s carbon-free standard, a key part of that state’s sweeping climate law enacted last year.
The North Dakota Industrial Commission, a three-member panel led by Burgum, filed formal comments with Minnesota’s Public Utilities Commission late last month, expressing concerns about the Minnesota law’s constitutionality and stating that carbon capture “must be recognized as a ‘carbon-free energy technology.’” Burgum is considered a top contender to be a potential running mate for former President Donald Trump.
The 14-page letter follows threats by Burgum a year ago to sue Minnesota over the clean power law. It also signals a rare area of agreement on energy policy between Trump supporters and the Biden administration, which has strongly backed carbon capture and storage (CCS) as a tool to fight climate change. The technology is at the center of EPA’s carbon rule for power plants.
While the Minnesota climate law signed by Democratic Gov. Tim Walz last year specified that certain renewable resources are eligible to qualify as carbon-free, it’s up to the state’s Public Utilities Commission to determine the role of technologies such as CCS and hydrogen. Both technologies have received huge backing from Biden’s Department of Energy and the Inflation Reduction Act.
Most other states with 100-percent clean power laws don’t specify what technologies are eligible to meet emissions reductions goals, though California’s Air Resources Board (CARB) in April called “deployment of CCS technologies” a “critical [greenhouse gas] abatement measure.”
The issue has added significance in the Upper Midwest, where a developer is planning an $8 billion pipeline to transport carbon dioxide from ethanol and fertilizer plants in the region to North Dakota, where the gas would be injected deep underground.
Without mentioning climate change or why it values carbon capture, the Burgum-led commission described North Dakota as a national leader on CCS technology, noting it was the first state granted primacy by EPA to oversee specialized injection wells for CO2 known as Class VI. The letter also cited millions of dollars in incentives for CCS research and development approved by the North Dakota Legislature going back a decade.
The state and its partners have “established and implemented numerous effective and ground breaking carbon capture policies and has dedicated substantial resources” to its development, the letter said.
North American Coal, a company that operates three surface lignite mines in North Dakota, also told the PUC the clean power law is unconstitutional. It said power plants supplied by its mines “play a role in providing its Minnesota neighbors with much needed affordable and dispatchable electricity, especially in harsh winter conditions when this electricity is most needed.”
Nexus Line LLC, the operator of a high-voltage power line connecting North Dakota’s largest coal-fired power plant — the 1,151-megawatt Rainbow Energy Center — to the suburbs of Minneapolis and St. Paul, also pushed for inclusion of CCS under Minnesota’s law, as did Minnetonka Power Cooperative, a generation and transmission cooperative based in Grand Forks, North Dakota.
Minnetonka Power Cooperative is the developer of Project Tundra, which aims to capture up to 4 million metric tons of CO2 annually from the coal-fired Milton R. Young Station in North Dakota.
The cooperative supplies electricity to eight distribution cooperatives in northwest Minnesota. Project Tundra was chosen in December to receive DOE funding for as much as $350 million to deploy carbon capture.
The Rainbow Energy Center, formerly known as the Coal Creek Station, was acquired in 2022 and its new owners have said they’re investing in carbon capture equipment at the plant with the help of $38 million in DOE funding. The aim is to make 90 percent of the plant’s output carbon-free.
A renewable model?
Joining energy companies in calling for CCS to be an eligible technology under state law are Minnesota utilities and electric cooperatives. Some, such as Xcel Energy and Otter Tail Power, also operate in North Dakota.
Otter Tail, in its comments, said including CCS as an eligible technology would be consistent with the EPA’s recently finalized power plant rules, which deem the technology as a best system of reducing carbon emissions from existing coal plants and new combustion gas turbines.
Aligning Minnesota’s definition of carbon-free with the technology underpinning EPA’s carbon rule “avoids conflicts or gaps between state and federal standards that would otherwise make resource planning very difficult,” the utility said.
While some clean energy advocates and environmental groups agree that fossil plants with CCS should qualify for partial credit, eligibility comes with caveats, they say there should be caveats.
Minnesota-based Fresh Energy said in comments to the PUC that megawatt-hours of power produced by plants able to capture carbon emissions should be given partial credit based on the percentage of emissions demonstrated to have been reduced.
Allen Gleckner, executive lead for policy and programs at Fresh Energy, said the mechanics of compliance haven’t been worked out yet, but he expects it will resemble how Minnesota and other states measure compliance with renewable energy standards that have been in place for decades across the U.S.
“The law is sort of built off the renewable energy standard, how all that works,” Gleckner said in an interview. “The utilities need to amass enough carbon-free generation to serve their Minnesota customers.”
The Minnesota Center for Environmental Advocacy and the Sierra Club said electricity generated from plants with CCS can qualify as carbon-free, but only if upstream and downstream climate impacts are accounted for.
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