Big Win for Renewable Energy

tumafeature“It is said that reforms never go backward, and I look for this law to become general in Minnesota in the near future.” – Gov. Samuel R. Van Sant, 1901

Samuel R. Van Sant was a short, plump, jovial riverboat captain from Winona, Minnesota. He and his family made their wealth off of moving commerce up and down the Mississippi River from St. Paul to the Gulf of Mexico. In 1900 he became governor of Minnesota by a very small margin as a Republican and soon won the hearts of progressives throughout the state for two very important initiatives. The first was the direct primary, which he is referring to in the above quote from his first inaugural address.

The second was the establishment of the State Board of Control to take on the railroad monopolies. The old riverboat captain didn’t have much love for his main competition on the iron rails. He particularly detested the Northern Securities Company run by fellow Minnesotan James J. Hill and his eastern industrialist partner J.P. Morgan. The jovial riverboat captain turned out to be a very determined trustbuster these two titans of the Gilded Age wished they never had crossed.

Hill and Morgan’s efforts to crush Van Sant and his little Board of Control soon turned into one of the nation’s biggest and most significant court dramas to ever come out of Minnesota. It eventually led to a federal government court action to dissolve the Hill-Morgan railroad monopoly with the backing of President Teddy Roosevelt under the newly passed Sherman Antitrust Act. In 1904 the Supreme Court, by a vote of 5 to 4, upheld the determination that Hill and Morgan’s Northern Securities Company was an illegal restraint of trade and the trust was broken up.

A future outgrowth Van Sant’s and other reformers’ progressive visions of protecting consumers was the Minnesota Public Utilities Commission (PUC) to help regulate the monopolistic structure of power utilities. Van Sant would have been proud of how the PUC law worked just recently relating to the development of new energy generation. For the first time the PUC required a competitive bidding process for a proposed major expansion of power generation forcing energy companies to compete on price. This last week an administrative law judge announced the winners of this competitive bidding process.

That is a fabulous development for consumers pocketbooks, but to the surprise of many pundits it also turned out to be a major victory for clean renewable energy because the winner of the bidding process was a 100% solar generation proposal. For several years the conservation community has been pushing for more renewable energy because of environmental benefits while understanding that for the time being the cost of this generation will be slightly higher than conventional power sources. Those making money from the old fossil fuel sources constantly beat the drums of opposition saying solar and wind will always be more expensive and less reliable. It is our contention that once these renewable generation methods get established, the result will be that they are far more competitive over the life of a particular project. That contention has finally come true with this first ever competitive bidding on the major energy generation expansion, thanks to Geronimo Energy.

Edina-based Geronimo Energy is well known in Minnesota as a leading windfarm developer, but this time they put together a large-scale solar proposal to compete head-to-head with several natural gas generation proposals. The key here is that this solar proposal by Geronimo did not have any public subsidies or tax breaks in order to make it more cost-effective and is not needed to meet any state-mandated renewable energy standard. In other words, Geronimo Energy went head-to-head with several gas generation proposals and they won even up in front of an administrative law judge in preparation for the PUC approval of the bids.

I’m sure several clean energy detractors will try to make the argument that the particular administrative law judge must have had a liberal political agenda. This is where they can’t be any more wrong. The Administrative Law Judge was Eric Lipman who is a former Republican legislator and Pawlenty appointee. I served in the Legislature with Judge Lipman during part of his tenure in the House between 2000-2004. He represented a conservative district in Washington County and during his years in the legislature had a reputation as a thoughtful but solid free-market conservative. As a matter fact, he was one of the strongest champions for free market business development.

Therefore, Geronimo’s victory in a head-to-head competition with gas generation is a major development for the future of clean renewable energy. Congratulations to the team at Geronimo and thanks to Judge Lipman for his thoughtful decision recognizing that not only is solar good for the environment it is also very competitive in the free market system. Clean energy is a reform that is here to stay and will “never go backward”.

About John Tuma

John is a former state legislator and litigation attorney. He served in the Minnesota House of Representatives for eight years from the Northfield area, beginning in 1994. Elected as a Republican, John was known for his independent thinking and ability to work across party lines. He is well-known in Minnesota state government circles.
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