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Energy efficiency act on its way to the House floor

Meet the new ECO Act. Same as the old ECO Act … almost.

Last May, the House passed the Energy Conservation and Optimization Act of 2020, which would have updated the state’s Conservation Improvement Program that helps Minnesota businesses and households use electricity and natural gas more efficiently. However, there was no Senate vote.

Hence, the ECO Act of 2020 is now the ECO Act of 2021, a bill only slightly altered from the previously proposed legislation. Sponsored by Rep. Zack Stephenson (DFL-Coon Rapids), HF164, as amended, was approved by the House Climate and Energy Finance and Policy Committee Tuesday by a 10-7 party-line vote, and is on its way to the House floor.

Its companion, SF227, sponsored by Sen. Jason Rarick (R-Pine City), awaits action by the Senate Energy and Utilities Finance and Policy Committee.

Stephenson said the bill would “modernize and expand Minnesota’s highly successful CIP program. It supports 45,000 jobs in every part of the state.” He called it “a comprehensive refresh of the program” that “will save consumers money and create jobs.”

He also spoke of broad support for the bill among Minnesota’s utilities, business groups, labor unions and environmental organizations, something echoed by testimony from representatives of three utilities and over a dozen letters of support sent to the committee.

While the majority of the bill’s language is already in statute, it would be reorganized into one section that applies to co-operatives and municipal utilities and another that pertains to investor-owned utilities. It calls for an increase in annual energy-savings goals, and how much a utility must spend on energy conservation programs for low-income households. Enforcing the statutes is overseen by the Department of Commerce.

While a Stephenson amendment was approved, four other proposed amendments were defeated, including two that would have kept energy efficiency and savings goals at 2007 levels.

Just as the bill is much the same as last year’s, so are the most common arguments against it. They chiefly center around “fuel switching,” the act of changing from one source of heat or electric power to another for economic or environmental reasons. The bill was portrayed by some Republican members as being unfair to the propane industry, which is not regulated by the Public Utilities Commission and doesn’t participate in the CIP program.

“The bill only allows fuel switching if it’s more efficient,” Stephenson replied. “No one is forced to make a fuel switch here. If you’re happy with propane, you don’t have to switch.”

Rep. Jamie Long (DFL-Mpls), the committee chair, said, “You’re going to be hard-pressed to find any energy legislation with such a broad array of stakeholders in favor of it.”

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