Sustainable: Presenting the business case for clean energy
From: Finance & Commerce by Frank Jossi
At a regional solar conference in late May, Gregg Mast appeared on a panel to discuss clean-energy issues being debated in the waning days of the 2017 legislative session.
Mast, the executive director of Clean Energy Economy Minnesota, apologized for being a bit bleary-eyed on May 23, the first full day of the Midwest Solar Expo at the Renaissance Minneapolis Hotel and Depot in Minneapolis.
“I’ve had a few late nights; it’s been a long legislative session,” he said with a smile.
Indeed, the Legislature had many proposals that clean-energy advocates saw as being detrimental to their industry. With help from the environmental community they ended up persuading Gov. Mark Dayton to use the threat of veto to remove most of the most offensive legislation, from their perspective.
Mast, 41, was in the middle of it, battling for businesses under Clean Energy Economy Minnesota’s banner. Formed last year, the organization is the first to have been started by clean-energy businesses to represent their interests at the Capitol and before the public.
Today Clean Energy Economy Minnesota has more than 30 members, including Mortenson Construction, Blattner Energy, Ever-Green Energy, LHB Inc. and Werner Electric.
“We saw a pressing need to have an organized business voice representing the clean-energy business in the state,” said Mast, who is president and CEO of Earthtech Energy Inc., a consulting firm in Minneapolis. “The idea was to highlight the business case for clean energy.”
So, what is the business case? The Clean Energy Trust’s “Clean Jobs Midwest” report said the field in Minnesota employs 54,458, with more than 47,000 of those in energy efficiency. The report showed 26 percent of clean-energy jobs are held by minorities, and 19 percent by women.
A 2014 report from the Minnesota Department of Employment and Economic Development pointed to a smaller number of jobs, around 15,000. The difference, said Mast, was one of definition. DEED considered a green job as one where employees spend more than 50 percent of their time on clean-energy work; Clean Jobs Midwest includes any time an employee is dealing with clean-energy-related projects.
While the DEED statistics pointed to fewer workers, they were well paid, with an average annual salary of $71,000. That is 42 percent higher than the state’s $50,000 average. The report credits Minnesota’s aggressive clean-energy legislation as the reason for the robust clean-energy sector.
In fact, Minnesota is home to two of the biggest players in wind and solar installations in the country. Among construction companies, Golden Valley-based Mortenson Construction ranks first in wind and third in solar installations in the United States, according to Energy News Record.
Blattner Energy, located in tiny Avon, has installed one-third of the wind capacity in the United States and Canada and was named in March the nation’s leading installer of solar by London-based IHS Markit. A solar analyst at Markit named Mortenson and Blattner Energy as two of the three leading companies in the country for installing photovoltaic solar last year, the biggest year for the industry ever.
Such success is what Mast hopes to highlight on his mission to educate policymakers, some of whom still do not see clean energy as a job creator. Instead, they tend to believe solar and wind cost more than conventional fossil-fuel-generated power and they have little idea of how many people work in the industry in the state, Mast said.
“Most are surprised to see and hear how substantial the industry is in Minnesota and to learn about the opportunities ahead for the state,” he said.
One strategy to highlighting clean energy’s impact will be inviting legislators to tour clean-energy businesses in their districts so they can meet employees and better understand the industry, Mast said.
The arrival of an organization devoted to promoting clean energy to policymakers, and offering collaborative opportunities for members, has been welcomed by the industry.
Mortenson’s Bradley Heitland, who serves on the Clean Energy Economy Minnesota’s board, said the group is becoming an important advocate for the industry.
“It’s active on renewable policies and active on the economical side of the business,” he said. “They’re all about coming with policies that generate value for their partners.”
Michael Noble, executive director of the clean-energy advocacy group Fresh Energy, said the state’s “strong foundation of energy policy” has led to business growth. “Clean Energy Economy Minnesota is doing the work to elevate those voices in order to grow our existing businesses and create new jobs,” he said.
At the Capitol
Clean Energy Economy Minnesota’s legislative priority was a bipartisan effort to move the state’s renewable energy standard to 50 percent by 2030. Now the standard requires utilities to reach 25 percent by 2025, and many of them are years ahead of schedule.
A higher standard would create even more clean-energy jobs, Mast said, while encouraging utilities to invest in renewable energy that today is cost-competitive with natural gas and coal. While the effort failed at the Legislature this year, advocates will continue to press for its passage in the future.
The story of energy legislation at the Capitol this session is as much about what didn’t happen as what did, Mast said. On May 30 Gov. Mark Dayton signed a jobs and energy bill that contained a handful of energy-related measures he didn’t particularly like, noting in his letter to legislators “that perhaps the most egregious policy provisions in this bill focus on energy.”
Perhaps the largest change is the end of the Made in Minnesota solar program, which offered buyers subsidies if they bought panels manufactured at least partly in the state. The program was part of the Renewable Development Fund, operated in conjunction with Xcel Energy. Money for the program comes from annual fees paid by Xcel for storing spent nuclear fuel casks at its two nuclear facilities. About $25 million comes into the fund yearly, and that money will now go to a variety of projects, including Xcel’s Solar Rewards program.
Another portion of the bill removes oversight by the Public Utilities Commission of fees being applied to solar and small wind customers by cooperative and municipally owned electricity providers. Along those same lines, legislation now exempts small utilities in greater Minnesota from having to comply with a conservation program.
Electric vehicles, but not hybrids, will be assessed a $75 annual fee. The idea is that electric vehicle owners pay no gasoline tax and as their numbers grow, road budgets could decline.
Finally, the omnibus legislation requires regulators to aim to keep utility rates a minimum of 5 percent below the national average. Minnesota’s utility rates are lower than other Midwest states, critics argue, and making one statistic a priority could dampen innovation and encourage power companies to use fees and other charges to maintain profitability while staying within the legislation’s guidelines.
Legislation that did not pass would have given the Legislature final say in any changes to the state’s building codes. Another failed measure would have changed the composition of the Public Utilities Commission to one where political bodies would appoint members.
Legislators also wanted control of the $47 million the state will receive from Volkswagen as part of a consent decree over vehicles designed to cheat emission-control testing equipment. They dropped the legislation, in part because the consent decree — arrived at by federal and California environmental officials — specifically outlined how the money could be spent after it was assigned to a state agency.
The Minnesota Pollution Control Agency, which was selected by the governor for the program, already has had meetings with stakeholders over how the money might be spent. Now that effort can continue without interruption.
Mast remains optimistic, pointing out that legislators listened to policy ideas that would bolster energy efficiency and clean energy.
“I am encouraged by the genuine interest many legislators have in wanting to better understand the business case for clean energy and its role in strengthening and diversifying our statewide economy,” he said.