Minn. House Energy Policy committee addresses 2 biomass bills

By Erin Voegele | March 08, 2013

On March 4, the Minnesota House of Representatives Energy Policy committee held hearings for two biomass energy-related bills. The first, H.F. 623, addresses biomass project development by the cities of Hibbing, Minn., and Virginia, Minn., in partial fulfillment of the biomass electric energy mandate issued to Xcel Energy by the legislature as part of the 1994 Prairie Island nuclear waste storage compromise. The second, H.F. 780, would allow waste heat used for heating or cooling and the displacement of fossil fuels by biomass-generated thermal heat to apply toward a utility’s energy saving goal, which is 1.5 percent of the previous year’s retail sales amount.

H.F. 623 was introduced on Feb. 14. A House research bill summary published on the legislation notes that the 1994 Prairie Island nuclear waste storage compromise called for the development of 110 MW of biomass-fueled electrical capacity. If signed into law, the bill would specify various elements of an amendment to the power purchase agreement that must be negotiated by mid-April and approved by the state Public Utilities Commission. Specifically, it applies to electric and steam generation facilities owned by the municipalities of Hibbing and Virginia. The facilities were converted from coal to biomass several years ago. The amendment includes a fuel cost adjustment, requiring Xcel to reimburse the plant ownership for all costs to procure and transport the fuel used to produce energy covered by the power purchase agreement.

H.F. 780 was introduced in the Minnesota House of Representatives on Feb. 21 and referred to the Energy Policy committee. Regarding biomass, the legislation would allow the state commerce commissioner to approve biomass-generated thermal heat used to displace natural gas heating within city buildings or college campuses to count toward a utility’s natural gas savings goal. Similarly, the bill summary notes that for similar biomass projects that displace fuel oil or propane in areas where natural gas service is not available, the commerce commissioner may allow utilities to count the energy savings realized at a rate of 1 KWh per 3,415 Btu.