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Doubling Down on Failure Fact Sheet

Minnesota currently has a law mandating that 25 percent of the state’s electricity come from renewable energy sources, like wind and solar, by 2025. Some lawmakers have proposed doubling the renewable energy mandate (REM), requiring that 50 percent of our electricity be generated by renewable sources by the year 2030, and Governor Walz has proposed a 100 percent carbon-dioxide-free electric grid by 2050.

This report chose to calculate the impact of a 50 percent REM, rather than a 100 percent REM, because research from the Massachusetts Institute of Technology shows using wind, solar, and batteries to achieve 100 percent of electricity generation would be exponentially more expensive than a 50 percent renewable benchmark.

Enacting a 50 percent renewable energy mandate by 2030 would:

  • Increase electricity costs by $80.2 billion through 2050 and have negligible environmental benefits.
  • Cost of energy would cost each Minnesota household $1,200 per year, every year, through 2050.
  • Cause electricity prices to increase an average of 4.18 cents per kilowatt hour (kWh), a 40.2 percent  increase relative to November 2018 prices.
  • Increase household electric bills by $375 per year, a 32 percent increase compared to 2017.
  • Force the Edina school district to lay off 10 teachers to make up for higher electricity prices. Edina schools use 13.8 million kWh of electricity every year. Increasing the price of electricity by 4.18 cents per kWh would result in increased electricity costs of approximately $576,425. Edina would have to lay off more than 10 teachers making $56,000 per year to pay these higher electric bills or raise property taxes to keep them on staff.
  • Destroy 20,950 jobs by 2050 and reduce Minnesota’s GDP by $3.1 billion every year to create temporary construction jobs.
  • Harm energy-intensive industries, such as agriculture, healthcare, manufacturing, and mining, the most.
  • Reduce future global temperatures by 0.0006 degrees C by 2100, an amount too small to measure.

In contrast, Minnesota could achieve the same reduction in carbon dioxide emissions by building new nuclear power plants for far less cost. Utilizing Minnesota’s existing coal-fired power plants would save Minnesotans $7.5 billion through 2050 and create 1,500 jobs.

High Cost of Failure Fact Sheet

Minnesota has enacted a renewable energy policy that focuses on wind energy. Unfortunately, building wind turbines and transmission lines to satisfy the state’s mandate has been enormously expensive. Moreover, Minnesota’s enormous investment in wind energy has failed to make a dent in reducing the state’s carbon dioxide emissions—its stated purpose. What it has done is drive up the cost of electricity for all Minnesotans.

Here are some basic facts from the report by Steven F. Hayward and Peter J. Nelson titled, “Energy Policy in Minnesota: The High Cost of Failure.” The report is illustrated with numerous charts and graphs.

* Minnesota has adopted a renewable energy standard that requires utilities to obtain 25% to 30% of their electricity from renewable sources. In Minnesota, that essentially means wind.

* Minnesota has also adopted a goal of reducing the state’s CO2 emissions by 80% by 2050. That goal cannot possibly be met.

* To date, approximately $10.6 billion has been spent on wind farms to supply energy to the state’s utilities, and another $4 billion on transmission lines.

* Historically, electricity in Minnesota was consistently cheaper than the national average, by 18%-20%. As these enormous investments have been made in wind energy, that advantage has been lost. 2017 was the first year ever in which electricity in Minnesota was more expensive than the national average.

* Minnesotans are now paying over $1 billion a year more for electricity per year than if the state had maintained its historic price advantage.

* Minnesota has not developed wind farms in order to meet increased demand for electricity.

* Consumption of electricity has been flat, and the state already had enough power capacity through its coal, natural gas and nuclear plants. Wind power has been an added-on cost above and beyond those existing facilities.

* $15 billion spent on wind energy has done little to reduce Minnesota’s CO2 emissions, which for the state as a whole are virtually the same as they were 20 years ago.

* Even emissions from the power generation sector are down only slightly compared with their 2005 peak.

* Wind power will never replace conventional sources of electricity (coal, natural gas and nuclear) because it is intermittent and unreliable. Wind turbines only generate electricity when the wind blows, so Minnesota needs enough reliable electricity sources to meet peak demand, no matter how many wind farms are constructed.

* Electricity cannot be stored at scale and must be consumed as it is produced. Wind energy is particularly low-value since it provides the most electricity when it is least needed: in the spring and fall, and at night. At times, wind farms actually pay utilities to take their electricity because there is no demand for it. Wind farms can make money doing this on account of federal subsidies.

* While the supposed environmental benefit of wind energy—reduction in CO2 emissions—turns out to be illusory, its environmental costs are very real: it needs vastly greater land area than conventional power plants; wind turbines are unsightly and noisy; being located far from where most electricity is consumed, they require many miles of transmission lines; and they kill large numbers of birds and bats.

About Center of the American Experiment

Center of the American Experiment is Minnesota’s leading public policy organization. The Center is more than a think tank. It not only researches and produces papers on Minnesota’s economy, education, health care, the family, employee freedom and state and local governance. It also crafts and proposes creative solutions that emphasize free enterprise, limited government, personal responsibility and government accountability.

American Experiment’s staff advances those solutions by drafting legislation, testifying before legislative committees, placing op-eds in newspapers and magazines across the State of Minnesota and nationally, appearing on radio and television news programs, holding town meetings, and lobbying. Further, American Experiment conducts grass roots advertising campaigns on radio and on the internet, which bring the key findings of the Center’s research papers to millions of Minnesotans. And the Center carries out investigative reporting, uncovering waste, abuse of power and ineptitude in Minnesota’s state and local governments, schools and unions.

For more than 25 years, Center of the American Experiment has been the most impactful and effective public policy organization in Minnesota. It leads the way in creating and advocating policies that make Minnesota a freer, more prosperous and better-governed state.

The Center is a civic and educational 501(c)(3) organization. Contributions are tax deductible.