Minnesota’s renewable energy snapshot: Growth and barriers

As President Obama is making plans to head back to the Gulf of Mexico to deal with the oil spill, more than 100 people from around Minnesota are at the Minnesota History Center today trying to figure out where the future lies for renewable energy in the state.

“The oil spill has changed the conversation dramatically,” Rep. Jeremy Kalin told the group gathered by Minnesota Renewable Energy Marketplace. Kalin sits on a White House task force of state legislators pulled together to look at renewable energy.

Kalin said Minnesota has done good work on renewable energy, conservation and carbon emission but is still waiting for substantial economic development benefits to result. And while a lot of the action in wind, solar, biofuels, bio mass and other renewable sources is at the state and even community level, Kalin urged people to watch the Clean Energy jobs and American Power Act that is expected to see Senate debate as soon as August.

It will include standards for renewable energy and efficiency and expectations for oil, nuclear and coal energy, but the key to debate will be the carbon pricing mechanism Senators will debate, Kalin predicted.

So what does Minnesota need to do to take further advantage of what everyone agrees is a rapidly evolving industry?

One key thing – tie state energy policy to the state’s economic development policy, said Rich Overmoyer, of GSP Consulting in Pittsburgh, hired by Minnesota Renewable Energy Marketplace to provide a snapshot of the renewable energy situation. Only Washington state does that today, Overmoyer said.

Key trends in the industry that Overmoyer identified:

–Federal and state policy will continue to drive the market.

–45 percent to 65 percent of new energy production in coming years will be from renewable sources.

–A recent short-term slowdown in renewable energy production is turning around.

–Internaitonal investment in wind, solar and biomass will continue to grow.

–The chain of supply of equipment and the market in general will continue to shake out and develop.

Wind energy has the greatest job creation potential, Overmoyer said. Minnesota has significant untapped capacity and the state’s existing requirements for utilities to use renewable energy make it a leader in the nation and will continue to drive use of wind energy. The big challenge clearly is the issue of transmission lines and connection to the existing power grid.

Overmoyer identified several barriers to growth in the industry, including the lack of capital availability and inconsistency in public policy – tax credits that come and go, for example.

Aside from a unified state strategy for energy and economic development, Overmoyer said a critical need is for a renewable energy clearinghouse.

This could be “a dating service for people in the renewable energy sector,” offering resources, toolkits, a website and the unknown benefits of forming relationships among people who otherwise wouldn’t talk to each other.

That reminded me of one of the principles to come out of the small towns conference in Morris last week, namely the value of making connections among people on the ground, the people who are creating the “new normal” for the economy and quality of life in Minnesota.

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