What's Happening in Minnesota

Minnesota was home to one of the most aggressive utility rate-basing attempts in the country. This, combined with statute that encourages utility owned EV chargers, makes Minnesota an unattractive state for private investment.

Charge Ahead Partnership is advocating for a competitive and level playing field for all retailers who want to provide publicly available electric vehicle charging stations in Minnesota. The most equitable, economic and practical way to build out a charging network in Minnesota is through a market-based approach which removes the barriers that are disincentivizing private investment in EV charging infrastructure. We work collaboratively with all stakeholders on commonsense solutions that unlock the market’s full potential without unfairly shifting the cost burden to non-EV users – particularly those in low- and fixed-income communities.

Currently, electric utilities have an edge over private investors looking to enter the EV charging market. Electric utilities have begun utilizing rate-basing to cover the installation and development costs of EV charging stations. Rate-basing allows power companies to transfer the cost for the installation of charging infrastructure to all of their utility consumers on their monthly electric bill, while the vast majority of their customers do not currently drive an EV and will not benefit from EV charging stations. Furthermore, rate-basing allows power companies to sell electricity for private EV charging stations at unprofitable rates by spreading the cost of this loss to all of their customers. This gives electric utilities a tremendous advantage over private companies who want to make investments in EV charging stations, and demonstrates ideals directly contrary to the free market principles that exist in every other growing industry.  

The lack of private investment in charging infrastructure only furthers one of consumers’ major concerns regarding EVs: Range anxiety, which is the fear of not having access to a charging station. When Americans drive gas-powered cars there is little concern about finding gas to refill when traveling or running errands. It is a different story for EV drivers. Charging networks can and should mirror existing fuel networks, a reality made difficult by barriers to private investment.

Minnesotans deserve access to a reliable, convenient and efficient EV charging network that meets both the needs of consumers and the market. Legislative action is required by the Minnesota Legislature to overcome these hurdles to private investment and make this network a reality.

2023 Minnesota Legislative Session Update:

CAP opposed Minnesota HF 413 and Minnesota SF 1296, two bills which contained extremely concerning language regarding the capabilities of electric utilities to build and own EV chargers using ratepayer funds. HF 413 and SF 1296 would have required utilities to submit Transportation Electrification Plans every three years. These plans could include proposals to build utility owned chargers. What’s worse, this legislation would enable utilities to recoup the costs of the installation and operation of their EV chargers by spreading the costs to their existing electric customers. While electric utilities would still be required to submit their plans to the Minnesota Public Utilities Commission for approval, these bills not only encouraged utility ownership of EV chargers, but also provided the legislative authority to rate-base the construction and operation of these chargers. While these bills did not pass, the concerning language was ultimately included in a large omnibus bill, Minnesota HF 2310, which the governor signed into law. Amendments made to the legislation did add language which encourages partnerships with existing fuel retailers, a small step in the right direction.

This legislation came on the heels of Xcel Energy's request to use almost $200 million in ratepayer funds to build more than 700 EV chargers in Minnesota. CAP was one of several groups who called to see this proposal moved to a separate and contested proceeding for evaluation. The Minnesota Public Utilities Commission evaluated this proposal through Docket 22-432. Xcel withdrew their proposal on June 1, 2023, putting a hold on their attempt to extend their monopoly into the EV charging marketplace. While the withdrawal of this request is a good sign, the new requirements of HF 2310 could drive future attempts from Xcel to take over Minnesota's EV charging marketplace. A long-term solution to establish a competitive EV charging marketplace in The North Star State remains crucial.

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