MOORHEAD — Minnesota Democrats are confident their ambitious climate law that requires the state's power utilities to use 100% carbon-free electricity by 2040 will survive a legal challenge from North Dakota.
A supporting letter from a Harvard law professor, circulated on the floor of the Minnesota Legislature as the bill (SF 4) was being debated, concludes if anybody challenges the law as unconstitutional, "the balance of legal authority will weigh heavily in favor of Minnesota."
If North Dakota decides to sue (still undecided although likely, if for nothing other than political reasons), what the courts decide is obviously up in the air. But Minnesota lawmakers and clean-energy advocates took pains to write the bill so it mirrored similar laws in other states that have been upheld by federal courts.
"Anything can happen when you get to court," said one source. "But we feel this was written tightly and that it'll hold up."
Gov. Tim Walz is expected to sign today the legislation that mandates Minnesota utility companies to provide electricity generated from carbon-free sources. It's meant to push the utilities to dump energy that comes from coal, natural gas and other sources that release planet-warming gases.
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Ari Peskoe Letter to Sen. Frentz by Mike McFeely on Scribd
North Dakota provides Minnesota utilities with electricity generated from coal-fired power plants.
Minnesota's two largest utilities, Xcel Energy and Minnesota Power, had planned to be carbon-free by 2050, but the new law accelerates the timeline by a decade.
Before the Democrat-controlled House and Senate passed the bill, North Dakota leaders like Gov. Doug Burgum and Agriculture Commissioner Doug Goehring sent a letter to Walz and others warning of "the certainty of a lawsuit" if SF 4 became law.
The letter referenced a lawsuit won by North Dakota in 2016, when the Eighth Circuit Court of Appeals struck down provisions of the 2007 Next Generation Energy Act, a bipartisan Minnesota law that banned the import of coal power from new sources. Burgum, Goehring and others believe that precedent has North Dakota on solid legal footing this time.
North Dakota believes Minnesota's new law is similar in that it would ban commerce between states, violating the U.S. Constitution.
Ari Peskoe, director of the Electricity Law Initiative at Harvard Law School, isn't so sure.
He provided a letter for Minnesota Sen. Nick Frentz, chair of the Energy, Utilities, Environment, and Climate Committee, that bolstered Democrats' belief their law is constitutional.
"I have reviewed Senate File 4 (SF 4) and find that it seeks to achieve legitimate energy policy goals in a manner that is consistent with the U.S. Constitution," Peskoe wrote. "SF 4 follows a well-established regulatory model that has withstood legal challenges in federal courts."
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Peskoe said he's tracked challenges to state energy laws for the past decade with a focus on preemption and dormant Commerce Clause claims.
"SF 4 respects the Constitutional limits of state authority," Peskoe wrote. "The bill's carbon-free standard places legal obligations only on Minnesota utilities that deliver energy to consumers in Minnesota. It does not regulate entities outside of Minnesota or impose terms and conditions on interstate transactions that might be preempted by the Federal Energy Regulatory Commission."
Peskoe outlines why the Eighth Circuit knocked down parts of the Next Generation Energy Act, citing its decision in North Dakota v. Heydinger that the prohibitions in the law violated the Commerce Clause.
Peskoe said each member of the court's three-judge panel found a different reason for finding the import ban unconstitutional.
"SF 4 avoids each of those legal infirmities. It does not regulate energy imports, ban interstate purchases, or mandate carbon offsets," Peskoe wrote. "Instead, it provides Minnesota utilities with the flexibility to meet the carbon-free standard by generating or procuring power or by buying renewable energy credits.
"This model is on solid legal ground. More than half of states enforce similar laws."
Peskoe cites examples from other states that could serve as precedent should North Dakota decide to sue.
Indeed, the new law doesn't mandate energy purchases and allows utilities "off-ramps" if they believe they can't provide affordable or reliable energy. Small rural utilities, particularly, were concerned about their ability to meet the standards in a timely, affordable manner.
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North Dakota energy advocates, in fact, met with Minnesota lawmakers to discuss the law and lobby for carve-outs related to carbon-capture. Minnesota did make some concessions to North Dakota's requests, but apparently not enough to avoid a lawsuit.
North Dakota's Industrial Commission — made up of Republicans Burgum, Goehring and Attorney General Drew Wrigley — voted unanimously Monday, Feb. 6, to allocate $1 million from a coal research fund for potential litigation against Minnesota and to approve the appointment of special assistant attorneys general to the case.
North Dakota legislators, too, rattled their sabres Monday about setting aside money for a legal challenge to Minnesota.
The Trust Project
