Minnesota has the opportunity to harness abundant renewable resources - especially wind - that provide environmental benefits, improved reliability, and economic development in the growing renewable energy business sector. Minnesota can also develop new efficient generators, such as CHP, using natural gas. Together, the opportunities shown in Figure 3 could supply 24 percent of Minnesota's generation capacity by 2010, and 48 percent by 2020.

The Clean Energy Development Plan can be realized at a modest cost, as energy efficiency savings offset the cost of new generation. In Minnesota, it would increase overall electricity costs by about 1.5 percent in 2010, and 3.4 percent in 2020.

Smart policies can overcome the many market and regulatory barriers that energy efficiency and renewable resources face. Minnesota has already adopted some policies to promote clean power options, but more must be done to succeed. The key policies for achieving the Clean Energy Development Plan are to:

1. Increase Minnesota's Energy Efficiency Investment Fund by investing 0.3¢/kWh.
2. Manage the Energy Efficiency Investment Fund by an independent third-party administrator overseen by a board composed of regulators, state energy offices, and consumer, efficiency and environmental advocates.
3. Evaluate and update Minnesota's efficiency standards and building codes. Establish or reinforce monitoring and enforcement practices.
4. Increase Minnesota's Renewables Portfolio Standard, so that the percentage requirement reaches eight percent by 2010 and 20 percent by 2020. Policymakers in Minnesota may wish to adopt an RPS requirement that is higher than those in neighboring states, due to Minnesota's abundance of wind resources. If the Minnesota RPS requirement were set at 11.5 percent for new renewables by 2010 (instead of eight percent), the costs of the Clean Energy Development Plan would increase from $61 million to roughly $83 million.
5. Establish a Renewable Energy Investment Fund to support emerging renewable technologies, with a non-bypassable charge of at least 0.1¢/kWh.
6. Ensure that transmission pricing policies and power pooling practices treat renewable resources fairly and account for their intermittent nature, remote locations, or smaller scale.
7. Remove barriers to clean distributed generation by: (1) establishing standard business and interconnection terms; (2) establishing uniform safety and power quality standards to facilitate safe and economic interconnection to the electricity system; and (3) applying clean air standards to small distributed generation sources, thereby promoting clean power technologies, and discouraging highly polluting diesel generators.