MINN TO TAX ND COAL

N.D. Eyes Suit Against Minn. Over Carbon Tax
December 29, 2009 (AP via WCCO/CBS)

"Attorney General Wayne Stenehjem said North Dakota is likely to file a legal challenge to Minnesota's efforts to make it costlier for utilities to use coal-generated electricity produced in western North Dakota.

"North Dakota officials have tried for months to change or soften the rules, which say power sources that generate carbon dioxide should include $9 to $34 in extra costs per ton of gas produced. The rules are intended to encourage utilities to use alternative energy sources…Stenehjem argued the rules would violate the U.S. Constitution's restrictions on states regulating each other's businesses."

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"Minnesota's Public Utilities Commission has rejected North Dakota's arguments…Stenehjem, Gov. John Hoeven and Agriculture Commissioner Doug Goehring are members of the North Dakota Industrial Commission, which oversees a state coal research fund…

"The state Legislature has authorized the commission to spend up to $2 million on possible litigation in the Minnesota dispute…[N]o decisions have been made on when a lawsuit will be filed, or whether it would be brought in state or federal court."

The best thing about Minnesota's move is that it could force ND to develop some of the nation's best winds. (click to enlarge)

"Western North Dakota's lignite fields supply nearby power plants that provide electricity for Minnesota customers…Great River Energy, of Maple Grove, Minn., owns power plants near the western North Dakota communities of Underwood and Stanton that are capable of generating almost 1,300 megawatts of power. Great River supplies electricity to 28 rural Minnesota cooperatives…Otter Tail Power Co., based in Fergus Falls, Minn., supplies communities in western Minnesota and manages the 427-megawatt Coyote station south of Beulah, N.D.

"The regulatory dispute dates to the mid-1990s, when the Minnesota PUC considered proposals to assess environmental costs of electricity generated by North Dakota coal plants…The PUC's initial estimates, published in December 2007, assumed coal-generated electricity would carry an environmental cost of at least $4 per ton of carbon dioxide generated, with a maximum of $30 a ton…[more recent estimates] put the range at $9 to $34 per ton…[which could] add roughly $7.50 to $28 monthly to the electric bill of a residential customer…The increase would be lessened if the utility supplied power from other sources that generate less carbon dioxide…"