NGIA: ‘No more’ Gas Innovation Act

The Natural Gas Innovation Act, or NGIA, is yet another example of Orwellian doublespeak. Rather than being about innovation in natural gas, the NGIA’s provisions are about the replacement of natural gas. And like renewables in electricity, the replacements promise to be unreliable, expensive and mandatory. Let’s look at the ‘devil in the details.’

Subdivision 10. Throughput goal

It is the goal of the state of Minnesota that through the Natural Gas Innovation Act and Conservation Improvement Program, utilities reduce the overall amount of natural gas produced from conventional geologic sources delivered to customers.

This provision states the goal of the NGIA, that being to “reduce the overall amount of natural gas…to customers.” It is on the second last page of Minnesota statute 216B.2427. It should be on the first page, or at least be the provision right after the definitions.

Subd. 1. Definitions

(i) “Innovative resource” means biogas, renewable natural gas, power-to-hydrogen, power-to-ammonia, carbon capture, strategic electrification, district energy, and energy efficiency.

There are twenty one definitions. The key one is “Innovative resource,” which crucially does not include conventional natural gas (CNG) in any form, low carbs or not. Indications are that the following ‘big three,’ of the eight above, are most likely to replace CNG.

(f) “District energy” means a heating or cooling system that is solar thermal powered or that uses the constant temperature of the earth or underground aquifers as a thermal exchange medium to heat or cool multiple buildings connected through a piping network.

(p) “Renewable natural gas” means biogas that has been processed to be interchangeable with, and that has a lower lifecycle greenhouse gas intensity than, natural gas produced from conventional geologic sources.

(r) “Strategic electrification” means the installation of electric end-use equipment in an existing building in which natural gas is a primary or back-up fuel source, or in a newly constructed building in which a customer receives natural gas service[.]

“Renewable natural gas” is at the device or building level. “District energy” is at the block or campus level. “Thermal energy network” is at the neigborhood or community level.

(s) “Thermal energy network” means a project that provides heating and cooling to multiple buildings connected via underground piping containing fluids that, in concert with heat pumps, exchange thermal energy from the earth, underground or surface waters, wastewater, or other heat sources.

The overall goal of replacing CNG is reflected in, and funded through, the following definition.

(t) “Total incremental cost” means … (1) the sum of: … (2) less the sum of: … (ii) cost savings achieved through avoidance of purchases of natural gas produced from conventional geologic sources, including but not limited to avoided commodity purchases and avoided pipeline costs;

Subd. 2. Innovation plans

(a) A natural gas utility may file an innovation plan with the commission. The utility’s plan must include, as applicable, the following components:

(1) the innovative resource or resources the utility plans to implement to contribute to meeting the state’s greenhouse gas and renewable energy goals[;]

Both CenterPoint Energy and Xcel Energy have recently filed plans with the Public Utilities Commission (PUC). The comment periods for CenterPoint are: July 31; September 2; and September 30. For Xcel: August 19; September 18; and October 21. Please have your say.

(2) research and development investments related to innovative resources the utility plans to undertake;

(5) a description of each pilot program included in the plan that is related to the development or provision of innovative resources, and an estimate of the total incremental costs to implement each pilot program;

These plans are mainly about the utilities spending money on how best to get rid of CNG. Money which they will be compensated for, by the PUC, out of the pockets of Minnesotans.

(6) the cost-effectiveness of innovative resources calculated from the perspective of the utility, society, the utility’s nonparticipating…and…participating customers compared to other innovative resources…to reduce or avoid the same greenhouse gas emissions[;]

Even the possibility of lower emissions CNG is ruled out by design.

(e) Upon approval of a utility’s plan, the commission shall establish cost-effectiveness objectives for the plan based on the cost-benefit test for innovative resources developed under section 216B.2428.

The PUC adopted “the partial cost-benefit-analysis framework [CBAF] jointly recommended by the parties and participants” on June 1, 2022. The PUC should have produced a full CBAF.

Subd. 4. Innovative resources procured outside of an innovation plan

(a) Without filing an innovation plan, a natural gas utility may propose and the commission may approve cost recovery for:

(2) utility expenditures for innovative resources procured at a cost that is within five percent of the average of Ventura and Demarc index prices for natural gas produced from conventional geologic sources at the time of the transaction per unit of natural gas that the innovative resource displaces.

The important phrase above, of course, is “natural gas that the innovative resource displaces.”

Subd. 6. Thermal energy audits

The first innovation plan filed under this section by a utility…must include a pilot program to provide thermal energy audits to small- and medium-sized businesses in order to identify opportunities to reduce or avoid greenhouse gas emissions from natural gas use. The pilot program must provide incentives for businesses to implement recommendations made by the audit.

This is a cross-subsidy from residential customers to reduce commercial/industrial CNG, on top of having to pay for their own ‘transition’ away from CNG.

Subd. 7. Innovative resources for certain industrial processes

The first innovation plan filed under this section by a utility…must include a pilot program to provide innovative resources to industrial facilities whose manufacturing processes, for technical reasons, are not amenable to electrification.

According to the federal Energy Information Administration (EIA): “one-fifth goes to the state’s electric power sector. Natural gas use for power generation in the state has substantially increased during the past decade, and in 2024 the sector consumed a record amount of natural gas in the state. Minnesota’s electric power sector used almost four times more natural gas than it consumed in 2014.” It is unclear if this provision will be applied here.

Subd. 8. Electric cold climate air-source heat pumps

(a) The first innovation plan filed under this section by a utility…must include a pilot program that facilitates deep energy retrofits and the installation of cold climate electric air-source heat pumps in existing residential homes that have natural gas heating systems.

CNG removal appears to be aimed at households, even as: “The industrial sector consumes the largest share of natural gas delivered to consumers in Minnesota and accounts for about three-tenths of state consumption. The residential sector, where two out of three Minnesota households heat with natural gas, uses about one-fourth of the natural gas delivered to consumers in the state. The commercial sector accounts for more than one-fifth[.]” – EIA

Subd. 11. Utility system report and forecasts

(a) A public utility filing an innovation plan shall concurrently submit a report to the commission containing the following information:

(5) a five-year forecast of fuel prices and anticipated purchases including, as available, natural gas produced from conventional geologic sources … ;

(6) a five-year forecast of potential capital investments by the utility in existing infrastructure and new infrastructure for natural gas produced from conventional geologic sources … ; and

(7) an inventory of the utility’s current financial incentive programs for natural gas, … and a description of the utility’s projected changes in incentives the utility is likely to implement over the next five years.

This is to make doubly sure CNG supply goes down, rather than staying the same, much less ever going up again.

Conclusion

Although it is not all that clear from the NGIA legislation, what are the favored replacements for natural gas and by when, it is clear that CNG is intended to be replaced one way or another, ‘come hell or high water.’ And, once again, as with renewable electricity and heat pumps, it is almost guaranteed that:

“Things will cost more, won’t work as well, and you’ll have no choice but to comply.” – Tim Blair, Let Freedom Spin! (June 26, 2026)

HAVE YOUR SAY

Website: https://mn.gov/puc/activities/economic-analysis/ngia/

Form: https://mn.gov/puc/get-involved/public-comments/

Email: [email protected]

U.S. Mail:

Consumer Affairs Office, Minnesota Public Utilities Commission

121 7th Place East, Suite 350

St. Paul, MN 55101