From Minnesota to the national stage: How Gov. Walz’s policies and utilization of federal funding shaped Minnesota’s clean energy economy

Following President Joe Biden’s decision to step down from reelection and endorse Vice President Kamala Harris in mid-July, the nation eagerly speculated about her choice of running mate. In the weeks leading up to Minnesota Governor Tim Walz’s selection, he went viral during a media blitz, where he touched on unconventional topics like ‘weirdness,’ ‘brat summer,’ and the ‘future of freedom.’ His dynamic interviews propelled him into the national spotlight. As we approach tonight’s Vice Presidential debate, Clean Energy Economy MN (CEEM) wants to highlight the significant strides his administration has made in clean energy policy, a journey we’ve been closely engaged with through our collaboration with the governor and his team.

Within the first three months of his first term in 2019, Governor Walz and Lieutenant Governor Flanagan proposed the One Minnesota Path to Clean Energy plan – a trio of policy proposals for 100% clean energy by 2050, Clean Energy First, and Energy Optimization. Following a nationwide push for 100% clean energy, a bill was introduced in the legislature, but it was not passed because of partisan divides between the House and the Senate. Despite these disagreements in the 2019 legislative session, Governor Walz continued forward with his climate agenda and directed the Minnesota Pollution Control Agency (MPCA) to implement a Clean Cars Standard and also established the Governor’s Council on Biofuels – both policies were aimed toward reducing carbon emissions and driving the state toward a cleaner transportation sector. Additionally, he declared February 13, 2019, as Clean Energy Business Day (CEBD) across Minnesota – where Clean Energy Economy Minnesota (CEEM) and other partner organizations and industry leaders gathered at the Minnesota State Capitol to celebrate the third annual CEBD. Closing out his first year, Governor Walz signed the Climate Change Executive Order (EO) 19-37, which created and established a new Climate Change Subcabinet and Advisory Council on Climate Change.

In 2021, the Walz-Flanagan administration, along with the support of House and Senate Democratic-Farmer-Labor (DFL) leaders of the Energy Committees, announced an even more ambitious climate plan expanding on the One Minnesota Path to Clean Energy initially announced in 2019. The four components of the climate policy proposal included an aggressive target of 100% Clean Energy by 2040 instead of 2050, Clean Energy First, Energy Optimization, and carbon reduction goals for existing buildings. While the plan was proved to be an ongoing work in progress, energy optimization was the first in the climate plan to be passed and signed into law by Governor Walz. The Energy Conservation and Optimization (ECO) Act was the “first major bipartisan law in years” and created more energy efficiency choices for consumers and businesses in the state.

Due to divided government and election-year politics, momentum in the clean energy space was stalled in the 2022 legislature, including the missed opportunity to capture $20 million in competitive funding from the Infrastructure Investment and Jobs (IIJA) Act. Later that year, the Walz-Flanagan team announced the release of the Minnesota Climate Action Framework, containing detailed goals and actions strategically put together by stakeholders across state agencies, organizations, and communities.

Federal policies, like the Infrastructure Investment and Jobs (IIJA) Act, CHIPS and Science Act, and the Inflation Reduction Act passed by the Biden-Harris Administration, significantly catapulted Minnesota toward more aggressive climate policies. According to the Investing in America’s Minnesota State Factsheet, there have been $2.6 billion in private sector manufacturing investments and $7.5 billion in public investments in clean energy, infrastructure, and manufacturing. President Biden’s Investing in America Agenda has allowed Minnesota to unlock competitive federal funding, public-private sector investments, and massive job creation.

In October 2022, Governor Walz signed Executive Order 22-22 and directed state agencies to pursue federal IIJA funding for clean hydrogen market development that would benefit Minnesota’s clean energy economy. The state also signed on to the Memoranda of Understanding for the Heartland Hydrogen Hub and the Midwest Hydrogen Coalition. A year after signing EO 22-22, Governor Walz celebrated the news of a $1 billion investment from the U.S. Department of Energy for the Heartland Hydrogen Hub.

The 2022 general election resulted in a DFL trifecta with Minnesota Democrats controlling the state legislature and Governor Walz winning reelection. With an additional $17.3 billion surplus, the legislature dived right into the 2023 session and spent little time in passing significant legislation. Within a month of the 2023 legislative session, Governor Walz passed and signed the 100% Clean Energy by 2040 bill. The passage of the 100% Clean Energy by 2040 paved the way for the passage of other notable clean energy bills leading to historic climate action legislation in Minnesota.

Some significant clean energy legislation passed in 2023 were:

The Walz-Flanagan administration’s efforts in leveraging federal funding opportunities also made more resources available, spurring massive clean energy projects and development statewide, such as Xcel Energy’s Sherco Solar Project and Cummin’s Electrolyzer Production. The Sherco Solar Project, located near the retired Sherco Coal plant site in Becker, is the Upper Midwest’s largest solar project at 710 MW when construction is finished, continuing to provide the community with high-quality jobs. Xcel expects to leverage federal tax credits that make the construction of the site more affordable.

The Electrolyzer Production Project, under Accelera by Cummins, is the first electrolyzer production site in the United States that will kickstart the green hydrogen economy. President Joe Biden attended the facility’s ribbon-cutting ceremony along with the U.S. Department of Energy (DOE) Secretary Jennifer Granholm, and Governor Walz in May 2023. More Minnesota projects under the IIJA, IRA, and CHIPS and Science Act can be found using the State of Minnesota’s Department of Management and Budget’s Federal Investment Tracker.

In 2024, the legislature continued the clean energy momentum from the previous session and passed the Minnesota Energy Infrastructure Permitting Act, which streamlines the permitting process for small wind and solar projects as well as large-scale projects. This bill, Walz’s most recent clean energy win, was signed by the Governor at a wind energy farm in rural Minnesota.

Looking forward, a potential Harris-Walz administration would likely spell a continuance and advancement of key federal initiatives like the IRA and the IIJA. However, what roles the Harris team may hand off to Gov. Walz remains yet to be seen. As Vice President, Kamala Harris has worked closely with President Biden, but the energy and climate policies pushed by the administration have primarily been driven by the Biden administration, so the full breadth of a potential Harris administration remains to be seen. Meanwhile, Gov. Walz’s leadership has positioned Minnesota as a leader in clean energy, with his administration advancing the state’s ambitious goal of 100% carbon-free electricity by 2040. Whether Harris would take on a larger role in shaping federal energy policy or leave space for an energy leader like Walz remains unclear, but what is clear is that Gov. Walz has made substantial impacts toward decarbonizing Minnesota’s energy landscape, which will continue for years to come.