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100% and what it means for consumers

100% and what it means for consumers


Minnesota’s 100% Carbon-Free by 2040 law is our state’s nation-leading commitment to transitioning away from fossil fuels and securing for Minnesotans all the economic, environmental, health, equity, and other benefits of the latest energy technologies. How does one law do all that?

The primary goal is in the name: with this law, Minnesota has asked our electric utilities to make their best effort to provide 100% carbon-free electricity by 2040. There are benchmarks set along the way starting in 2030, when investor-owned utilities must reach 80% carbon-free electricity, while coops and municipal utilities need only 60%. Then in 2035, the law requires all utilities to reach 90% carbon-free energy, with 55% of their electric generation coming specifically from renewables, excluding some carbon-free sources like nuclear and newly constructed large hydropower. 

Making the switch to renewable and carbon-free sources, 100% by 2040 will lower the cost of electricity for Minnesota’s consumers. Minnesota’s fossil-fuel power plants are many decades old and in need of replacement, and renewable generation will be cheaper to build than new fossil fuel generators. It already costs less to build new renewable generation than to simply operate our aging coal plants – and the incentives in the federal Inflation Reduction Act effectively put renewables on sale for the next decade. Renewables will also help protect electric consumers from volatile natural gas markets, which were responsible for 90% of the rate hikes seen by Xcel customers last year. Importantly, this law will also help deliver Minnesotans cleaner air and water and reduce our contribution to climate change and the extreme weather it brings. 

The 100% Carbon-Free law directs the Public Utilities Commission (PUC), which regulates Minnesota utilities, to track the environmental justice impacts while implementing this law, to ensure that air quality improvements and other benefits are spread equally to all Minnesotans. 

Those benefits include bringing high-quality clean energy jobs to our state, giving Minnesotans the skills and tools necessary to enjoy those jobs and adapt to the clean energy transition, and recognizing the rights of workers to organize. The law includes preferences for local job creation and domestically produced materials, and requirements for utilities to report on efforts to retain workers from shuttered power plants, increase workforce diversity, and more. Our renewed commitment to carbon-free energy will also encourage the growth of new businesses by giving our clean energy industry the support it needs to thrive. 

Finally, this bill was written in collaboration with Minnesota’s utilities to ensure that our consumers and our grid remain protected. Utilities may purchase Renewable Energy Credits (RECs) to help meet the standard set, exchanging investments in renewable energy elsewhere in the country in cases where the standard can’t be met economically here. The PUC is also given the discretion to delay or modify the standards if necessary to protect the reliability and affordability of electricity.

100% Carbon-Free puts Minnesota back at the lead of the national transition away from fossil fuels for the first time since a bipartisan group of lawmakers passed the Renewable Energy Standard in 2007. With this commitment, we’re poised once again to bring the many benefits of clean energy home to our state.

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