The Extractive Industry Greenhouse Gas Reduction and Renewable Energy Incentivization Act

Proposed bill for the Minnesota State Legislature regarding the advancement of renewable energy on mining land.

A BILL

To be introduced in the 93rd Legislature of the State of Minnesota

Date: [Insert Date]

By Representative [Insert Name]

SECTION 1. TITLE

This Act shall be known as the Extractive Industry Greenhouse Gas Reduction and Renewable Energy Incentivization Act.

SECTION 2. FINDINGS AND PURPOSE

(a) Findings. The legislature finds that:

1. Mining operations in Minnesota contribute significantly to greenhouse gas emissions (GHGs), including carbon dioxide (CO₂), methane (CH₄), and nitrous oxide (N₂O).

2. The General Mining Law of 1872 is outdated and does not provide adequate environmental safeguards.

3. Minnesota is a leader in clean energy policy, with its Next Generation Energy Act and Climate Action Framework demonstrating the state's commitment to reducing emissions.

4. Implementing renewable energy at mining sites and incentivizing emission reductions will enhance sustainability, economic resilience, and environmental protection.

(b) Purpose.The purpose of this Act is to:

1. Require mining operations to integrate renewable energy into their operations.

2. Provide flexible compliance mechanisms for mining operations to meet GHG reduction goals.

3. Establish incentives for land rehabilitation and participation in carbon credit markets.

SECTION 3. DEFINITIONS

For the purposes of this Act:

• "Mining operation" refers to any entity engaged in the extraction of minerals or ores within the jurisdiction of the state of Minnesota.

• "Renewable energy" includes solar, wind, hydroelectric, geothermal, hydrogen, and biomass sources as defined under Minnesota law.

• "GHG emissions" refer to carbon dioxide (CO₂), methane (CH₄), nitrous oxide (N₂O), and other pollutants regulated under the Clean Air Act (CAA).

• "Carbon credit market" refers to a system where mining operations can earn tradable credits for reducing emissions or engaging in carbon sequestration activities.

SECTION 4. MANDATORY USE OF RENEWABLE ENERGY AT MINES

(a) Renewable Energy Requirement

1. All new mining operations must use at least 50% renewable energy for power generation.

2. Existing mines shall transition to a minimum of 50% renewable energy within five years of this Act’s passage.

3. Mines exceeding 50% renewable energy use may qualify for state tax incentives and clean energy grants.

(b) Administration and Compliance

1. The Minnesota Pollution Control Agency (MPCA) shall oversee compliance, issue certifications, and conduct annual energy consumption audits.

2. Mines failing to comply shall be subject to penalties or loss of state-funded incentives.

SECTION 5. FLEXIBLE COMPLIANCE MECHANISMS

(a) Performance-Based Incentives

1. Mines achieving additional reductions in emissions beyond required levels shall be eligible for:

   • Tax credits under the Carbon Credit Market Regulation Act (proposed legislation).

   • Financial incentives from state clean energy transition funds.

(b) Flexible Compliance Pathways

1. Mines unable to meet targets due to geographical or financial constraints may apply for an extended compliance timeline, provided they submit a GHG Reduction Plan for approval by the MPCA.

2. The state may offer direct technical assistance in adopting clean energy technologies.

SECTION 6. INCENTIVIZED LAND REHABILITATION & CARBON CREDIT PARTICIPATION

(a) Land Rehabilitation Requirements

1. Mines conducting land rehabilitation post-closure shall qualify for state grants covering up to 50% of project costs.

2. Land restoration projects must incorporate carbon sequestration strategies, including reforestation and soil carbon capture.

(b) Carbon Credit Market Participation

1. The state shall establish a Minnesota Carbon Credit Exchange, allowing mining companies to trade carbon credits based on verified emissions reductions.

2. Participation in the carbon credit market shall be voluntary but incentivized through state tax breaks and grants.

SECTION 7. ENFORCEMENT AND PENALTIES

1. The MPCA shall conduct regular compliance inspections.

2. Failure to meet renewable energy or emissions reduction targets shall result in fines not exceeding $500,000 per violation per year.

3. Mining companies engaging in intentional non-compliance shall be subject to permit revocation.

SECTION 8. FUNDING AND IMPLEMENTATION

1. Funding shall come from:

   • Federal Clean Energy Deployment Grants (Energy.gov).

   • Minnesota Climate Action Framework Funds ($14.2 million allocated).

   • State tax incentives for mines meeting clean energy targets.

2. Implementation will be phased over five years, with annual progress reports submitted to the Minnesota Legislature.

SECTION 9. LEGAL PRECEDENTS AND JUSTIFICATION

1. The Act aligns with federal emissions reduction goals under the Clean Air Act (CAA) and follows the precedent set in National Pork Producers Council v. Ross (2023) regarding state authority to regulate industries within its borders.

2. It is structured to avoid conflicts with the Dormant Commerce Clause, ensuring Minnesota does not interfere with interstate commerce while promoting local clean energy initiatives.

SECTION 10. EFFECTIVE DATE

This Act shall take effect immediately upon passage and enforcement shall begin January 1, 2026.

Extractive Industry GHG Reduction Policy Portfolio and Anticipated Outcomes-2.docx

Download DOCX • 55KB