Building a Better Power Grid for Minnesota

Minnesotans are facing concurrent crises of climate change, high energy prices and inflation, and the inequitable public health impacts of fossil fuel air pollution. Renewable energy will help with all of that—but we need a grid that is designed for wind and solar instead of having to rely on expensive coal and gas plants.

Unfortunately, the Minnesota Legislature failed to act on climate and clean energy investments this session, leaving progress toward a more affordable, equitable, healthy Minnesota on the table. However the Midcontinent Independent System Operator, or MISO, the Midwest’s regional grid manager, has stepped up to approve long-awaited upgrades that will improve the reliability of the electricity system across the region, including Minnesota as well as Illinois and Michigan. These investments will help accommodate accelerating amounts of low-cost renewable energy like wind and solar power, laying the groundwork for a cleaner, cheaper grid.

Wait—MISO? That’s not a Minnesota utility…is it?

Most Minnesotans are familiar with their local electricity utility, since that’s who bills them for electricity they provide. And local utilities like Xcel Energy are on the hook for a lot—like generating enough electricity to meet customer demand and providing energy efficiency or solar programs. But long-range power lines are connected throughout the region across different utilities, creating a transmission system—and a regional power market—that needs regional oversight and planning. That’s where MISO comes in.

For the last few years, MISO has been assessing grid reliability issues and areas of the grid that are being overloaded and engaging in long-range transmission planning, or LRTP, to propose specific projects and transmission lines that will bring significant benefits to Minnesota ratepayers in terms of added reliability and avoided costs. These regional planning processes are a critical part of decarbonizing the power grid.

The benefits far outweigh the costs

The first set of projects coming out of the LRTP are collectively known as Tranche 1, which includes projects proposed in Zone 1 of MISO: Minnesota, North Dakota, and western Wisconsin.

The LRTP Tranche 1 portfolio of investments will facilitate the development of new renewable energy resources in Zone 1, which includes much of Minnesota. According to the Clean Grid Alliance, these grid investments will enable more than 13,000 megawatts of new wind and solar resources, creating more than 56,000 jobs in the region. 

MISO expects this region to receive between $7.9 and $11.2 billion in benefits from the LRTP Tranche 1 portfolio of investments, versus a cost estimate of just $2.8 billion. That means MISO expects ratepayers in Minnesota and the surrounding states to see benefits three to four times more than the cost of the grid upgrades—and that’s just the benefits MISO was able to quantify, such as being able to move cheaper wind and solar power around the electricity system instead of having to rely on more expensive fossil fuels.

Getting energy from where it’s produced to where it’s needed

Energy prices tend to soar when there are constraints or shortages and times of high demand, and Minnesota is no stranger to these costs. During the Texas power outages in 2021, Minnesota gas utilities were stuck buying gas at Midwest wholesale prices 4500% higher than usual, passing astronomical bills onto Minnesota consumers—many of whom are already struggling with energy burdens that are higher than average.

When temperatures are high in the summer, increased electricity demand from spikes in air conditioning stresses the grid and raises costs. Being able to get lower-cost wind and solar power where it’s needed will not only help brace the grid during extreme weather and high demand—and reduce the risk of brownouts or controlled outages—but it will also help lower costs across the region. 

Southwest Minnesota and the Dakotas have a lot of wind power—and the potential for even more. These kinds of transmission investments will help get these surplus amounts of cheap, clean energy to other areas across the region. The Jamestown–Ellendale project and the Big Stone South–Alexandria–Cassie’s Crossing (labeled 1 and 2 on the map pictured above) will help transport energy out of Dakotas toward central Minnesota and the Twin Cities area.

According to MISO, the upgrades slated for Minnesota and Wisconsin (labeled 4, 5, and 6 above) will also provide an outlet for Minnesota renewable energy. Allowing for more mobile renewable energy in the region provides much-needed reliability as coal plants in the region retire, and removes barriers to retiring more polluting power plants even sooner.

Additionally, the projects will relieve congestion—everyone hates traffic jams, including electrons—and addresses areas with excessive loading, building a more resilient and reliable grid. Both of these carry significant savings: fuel savings from enabling renewable energy to flow through the grid and displace fossil fuels, and reduced risk of costly blackouts.

Unlocking the gridlock for Minnesota’s renewable energy future

Minnesota’s current goal is to reduce statewide carbon emissions 30 percent by 2025 compared to 2005 levels and 80 percent by 2050.

The Minnesota House has proposed legislation to update the state’s target for reducing heat-trapping emissions to achieve “net zero” emissions by 2050 and reach 100 percent carbon-free electricity by 2040. Governor Tim Walz has also proposed a 100 percent clean energy standard to require all electric utilities in Minnesota to use only carbon-free energy resources by 2040.

Utilities in Minnesota are setting goals as well. Xcel Energy pledged to provide customers with 100 percent carbon-free electricity by 2050. The company’s recently approved resource plan includes over 4,500 megawatts of new solar, wind, and battery storage on its way toward 80 percent of electricity generation from carbon-free resources by 2032—and no new gas. Minnesota Power’s vision is to provide 100 percent carbon-free energy by 2050, achieve 70 percent renewable electricity by 2030, and eliminate coal burning by 2035.

In addition to political barriers like the Minnesota Senate, the current grid poses a physical, technological barrier to reaching the levels of renewable energy needed to address the climate crisis. Building a modern grid that allows cheaper renewable energy to reliably displace dirty, expensive fossil fuels is crucial to progress on climate change, public health, and energy affordability. But we’re going to need a lot more than Tranche 1.

What’s next for MISO transmission planning in Minnesota?

Tranche 1 will address existing reliability issues, literally helping to keep the lights on—and at the same time enabling ratepayers to benefit from the cost effectiveness of renewable energy. More forward-thinking upgrades that could align the grid with the level of leadership utilities and policymakers are already showing in Minnesota and enable climate goals to become a reality will come in the next three “Tranches” MISO intends to propose.

Now that Tranche 1 is approved by MISO, it’s up to Midwest states to evaluate and approve the projects. Minnesota’s state agencies and regulators should ensure inclusive, equitable siting and permitting processes for these transmission projects that ensure robust public participation and community engagement. MISO’s approval of these initial lines is a big step, but it and the states must continue their work to create the modern transmission system that people and the climate need: carbon-free, renewable, reliable, and affordable.

Originally published in Union of Concerned Scientists.