December 20, 2012 Burl W. Haar Executive Secretary Minnesota Public Utilities Commission 121 7th Place East, Suite 350 St. Paul, Minnesota 55101-2147 RE: Comments of the Minnesota Department of Commerce, Division of Energy Resources Docket No. E999/PR-12-334 Dear Dr. Haar: On April 10, 2012 the Minnesota Public Utilities Commission (Commission) issued a Notice of Renewable Energy Certificate (REC) Retirement Process and Compliance Report for 2011. The Notice required entities subject to Minn. Stat. 216B.1691 (RES Statute) to file by June 1, 2012 a report detailing their compliance with the RES Statute for the year 2011. Minn. Stat. 216B.1691, subd. 2 requires utilities other than Xcel Energy to make a good faith effort to obtain at least 7 percent of their Minnesota retail sales from renewable energy sources by the end of 2010, while Minn. Stat. 216B.1691, Subd. 2 (b) requires Xcel Energy to obtain 15 percent of its retail sales from renewable energy sources by the end of 2010. 1 In the Commission s March 19, 2010 Order in Docket No. E999/CI-03-869, the Commission clarified that the RES standard is to be applied in every year going forward until the standard changed. Consequently, the RES standard for 2011 is 15 percent for Xcel and 7 percent for all other utilities. The Commission s December 3, 2008 Order in Docket No. E999/CI-04-1616 2 and November 12, 2008 Order in Docket No. E999/CI-03-869 set forth additional reporting requirements for RES compliance. 1 These amounts increase to 12 percent and 18 percent, respectively, for these entities for the 2012 compliance year. 2 In the Matter of a Commission Investigation into a Multi-State Tracking and Trading System for Renewable Energy Credits, Third Order Detailing Criteria and Standards for Determining Compliance under Minn. Stat. 216B.1691 and Setting Procedures for Retiring Renewable Energy Credits, December 3, 2008, Docket No. E999/CI-04-1616. In the Matter of Detailing Criteria and Standards for Measuring an Electric Utility s Good Faith Efforts in Meeting the Renewable Energy Objectives under Minn. Stat. 216B.1691, Order Setting Filing Requirements and Clarifying Procedures, November 12, 2008, Docket No. E999/CI-03-869.
Burl W. Haar December 20, 2012 Page 2 The following utilities have filed their 2011 compliance reports: Basin Electric Cooperative (Basin), Central Minnesota Municipal Power Agency (CMMPA), Dairyland Power Cooperative, East River Electric Power Cooperative (East River), Great River Energy (GRE), Heartland Consumers Power District, Interstate Power and Light (IPL), L&O Power Cooperative, Minnesota Municipal Power Agency (MMPA), Minnesota Power (MP), Minnkota Power Cooperative, Missouri River Energy Services, Northern States Power. d/b/a Xcel Energy (Xcel), Northwestern Wisconsin Electric Company. Otter Tail Power Company (OTP), and Southern Minnesota Municipal Power Agency (SMMPA). The Minnesota Department of Commerce, Division of Energy Resources (DOC) reviewed these filings and verified that utilities have complied with the 2011 RES requirement. Attached to this letter is a table and brief narrative summarizing each utility s compliance with the RES Statute. The DOC is available to answer any questions the Commission may have. Sincerely, /s/ SUSAN L. PEIRCE Rate Analyst SLP/jl Attachment
Summary of 2011 Minnesota RES Compliance through Retirement of Renewable Energy Credits (RECs) 2011 Retail Sales (MWhs) RES Requirement (%) RES Req. (MWhs) RECs Retired (MWhs) Above/(Below) RES Requirement Basin Electric 568,250 7% 39,777 39,777 0 CMMPA 319,698 7% 22,379 22,379 0 Dairyland Power 787,874 7% 55,151 55,154 3 East River Electric 334,034 7% 23,382 23,403 21 GRE** 10,597,425 7% 741,820 749,410 7,590 Heartland 654,818 7% 45,837 45,838 1 Interstate Power 846,818 7% 59,277 59,277 0 L&O Power 241,073 7% 16,875 16,876 1 Minnesota Power 10,130,969 7% 709,168 709,168 0 Minnkota 1,542,022 7% 107,942 107,942 0 MMPA 1,382,808 7% 96,797 96,797 0 Missouri River Energy Services 1,226,901 7% 85,883 85,884 0 NW Wisconsin * 450 7% 32 1 Otter Tail Power 2,085,902 7% 146,013 146,013-32 SMMPA 2,929,414 7% 205,058 205,059 0 Xcel Energy 31,788,268 15% 4,768,240 4,768,241 1 1 Total 65,436,274 7,123,601 7,131,218 0 *The Commission s November 12, 2008 Order in Docket No. E999/CI-03-869 allows Northwest Wisconsin to submit a copy of its Wisconsin compliance report to demonstrate its compliance with the Minnesota RES. On May 8, 2012, Northwest Wisconsin submitted its Wisconsin Renewable Portfolio Standard (RPS) compliance information indicating that it retired 24,084 RECs or 14.48 percent of its Wisconsin sales. **In its Compliance Report, GRE indicated that it retired 22,626 RECs associated with wholesale sales by two of its members, Connexus and Lake Country Power. In each case, Connexus and Lake Country Power resold the renewable energy to another distribution cooperative. In addition, GRE stated that it had wholesale sales to Willmar Municipal Utilities under a Participation Power agreement for which it did not retire RECs. GRE indicated that the sale to Willmar was not part of an all-requirements contract and, consequently, GRE does not believe it is required to retire RECs for its sales to Willmar. GRE s sales to Willmar would require the retirement of an additional 15,040 RECs. The Department has reviewed GRE s comments and believes that GRE is not required by Minn. Stat. 216B.1691 to retire RECs related to the wholesale sales by Connexus and Lake Country, but is required to retire RECs related to its sales to Willmar. Minn. Stat. 216B.1691, Subd. 2a(a) states:
Each electric utility shall generate or procure sufficient electricity generated by an eligible energy technology to provide its retail consumers, or the retail customers of a distribution utility to which the electric utility provides wholesale electric service, so that at least the following standard percentages of the electric utility s total retail electric sales to retail customers in Minnesota are generated by eligible energy technologies by the end of the year indicated In the case of GRE s sales to Connexus and Lake Country Power, the Cooperative correctly retired RECs for its wholesale sales associated with the retail sales of these two distribution cooperatives. However, in addition, GRE retired RECs associated with wholesale sales made by each cooperative to other distribution cooperatives. The statute states that the RES obligation only applies to the retail customers of a distribution utility to which the electric utility provides wholesale electric service. Consequently, the Department concludes that the RES statute does not require GRE to retire RECs for the wholesale sales made by Connexus and Lake Country Power. The Department also would distinguish GRE s wholesale sales to Connexus and Lake Country Power from Basin Electric Cooperative s wholesale sales to East River Cooperative and L&O Power. Under Minn. Stat. 216B.1691 Subd. 1 (b), an electric utility is defined as a public utility providing electric service, a generation and transmission cooperative electric association, a municipal power agency, or a power district. Both East River and L&O Power are wholesale power supply cooperatives serving other distribution cooperatives, and consequently meet the definition of an electric utility subject to the RES requirement. In contrast, Connexus and Lake Country Power are distribution cooperatives, and thus are not subject to the RES requirements. In the case of GRE s wholesale sales to Willmar, Willmar is a municipal utility serving retail customers. Consequently, GRE s wholesale sales meet the definition of the retail customers of a distribution utility to which the electric utility provides wholesale electric service. The Department concludes that the net impact of GRE s REC retirement associated with the two wholesale transactions is that it retired 7,586 more RECs than required (22,626 retired for Connexus/Lake Country 15,040 not retired for Willmar), and is therefore in compliance with its RES requirements. /jl
CERTIFICATE OF SERVICE I, Sharon Ferguson, hereby certify that I have this day, served copies of the following document on the attached list of persons by electronic filing, certified mail, e-mail, or by depositing a true and correct copy thereof properly enveloped with postage paid in the United States Mail at St. Paul, Minnesota. Minnesota Department of Commerce Comments Docket No. E999/PR-12-334 Dated this 20 th of December, 2012 /s/sharon Ferguson
First Name Last Name Email Company Name Address Delivery Method View Trade Secret Service List Name Julia Anderson Julia.Anderson@ag.state.m n.us Office of the Attorney General-DOC 1800 BRM Tower 445 Minnesota St St. Paul, 551012134 Tammie Carino tcarino@grenergy.com Great River Energy 12300 Elm Creek Blvd. Electronic Service Yes OFF_SL_12-334_Official Maple Grove, 55369-4718 Curt Dieren cdieren@dgrnet.com L&O Power Cooperative 1302 South Union Street PO Box 511 Rock Rapids, IA 51246 Sharon Ferguson sharon.ferguson@state.mn.us Ronald J. Franz Dairyland Power Cooperative Department of Commerce 85 7th Place E Ste 500 Saint Paul, 551012198 3200 East Ave S PO Box 817 La Crosse, WI 546020817 Amy Fredregrill N/A M-RETS 1885 University Avenue West, #315 St. Paul, 55104 Gary Garbe Gary.Garbe@avantenergy. com Minnesota Municipal Power Agency 200 South Sixth Street Suite 300 Minneapolis, 55402 Burl W. Haar burl.haar@state.mn.us Public Utilities Commission Suite 350 121 7th Place East St. Paul, 551012147 Casey Jacobson cjacobson@bepc.com Basin Electric Power Cooperative 1717 East Interstate Avenue Electronic Service Yes OFF_SL_12-334_Official Paula N. Johnson Interstate Power and Light Company Bismarck, ND 58501 200 First Street SE PO Box 351 Cedar Rapids, IA 524060351
First Name Last Name Email Company Name Address Delivery Method View Trade Secret Service List Name Larry Johnston lw.johnston@smmpa.org SMMPA 500 1st Ave SW Rochester, 55902-3303 Nate Jones njones@hcpd.com Heartland Consumers Power John Lindell agorud.ecf@ag.state.mn.us Office of the Attorney General-RUD Steven Lyons Steven.Lyons@avantenerg y.com MInnesota Municipal Power Agency PO Box 248 Madison, SD 57042 1400 BRM Tower 445 Minnesota St St. Paul, 551012130 200 S 6th St Ste 300 Minneapolis, 55402-5387 David Moeller dmoeller@allete.com Minnesota Power 30 W Superior St Electronic Service Yes OFF_SL_12-334_Official Duluth, 558022093 Ben Nelson CMMPA 459 South Grove Street Blue Earth, 56013 John Richards N/A Northwestern Wisconsin Electric Company 104 S. Pine St. Grantsburg, WI 54840 Craig Rustad crustad@minnkota.com Minnkota Power 1822 Mill Road PO Box 13200 Grand Forks, ND 582083200 Robert K. Sahr bsahr@eastriver.coop East River Electric Power Cooperative Mrg Simon mrgsimon@mrenergy.com Missouri River Energy Services P.O. Box 227 Madison, SD 57042 3724 W. Avera Drive P.O. Box 88920 Sioux Falls, SD 571098920 2
First Name Last Name Email Company Name Address Delivery Method View Trade Secret Service List Name SaGonna Thompson Regulatory.Records@xcele nergy.com Xcel Energy 414 Nicollet Mall FL 7 Minneapolis, 554011993 Carol Westergard N/A Otter Tail Power Company PO Box 496 215 S Cascade Street Fergus Falls, 56538-0496 3