Minnesota House Bill HF1714

Minnesota 2023-2024 Regular Session

• Introduced: 2/13/23
• Refer: 2/13/23

Caption

Process established to compensate businesses for loss of business opportunity resulting from sale and closure of biomass energy plant.

Impact

The enactment of HF1714 would amend existing regulations under Minnesota energy law, ensuring that businesses affected by biomass plant closures receive financial support. This could significantly impact the industry's operations, particularly for businesses that rely on contracts with biomass facilities. Furthermore, the bill stipulates specific eligibility criteria, which include proof of operational contracts dating back to at least May 1, 2017, thereby affecting the landscape for existing and future business contracts in the renewable energy sector. The allocation of funds for claims will be managed through the newly established 'biomass business compensation account', which is set to receive substantial appropriations from the renewable development account.

Summary

House File 1714 seeks to provide a structured compensation mechanism for businesses that experience financial losses due to the early closure and sale of biomass energy plants. The bill establishes a claims process, managed by the Office of Administrative Hearings, to evaluate and award claims from affected businesses. Specifically, it recognizes two main types of claims: (1) decreased operating income and (2) loss of value in investments tied to the operations linked to biomass plants. This compensation program is intended to mitigate the disruptions caused by the closure of critical energy infrastructure.

Contention

While proponents argue that the bill is essential for offering equitable support to disadvantaged businesses due to unforeseen plant closures, critics may contend that it represents a significant financial obligation on the state without guaranteed long-term benefits. Concerns have been raised about the potential for misallocation of funds and whether the compensation system might set a precedent for further state intervention in private contracts. Additionally, since the bill establishes a limit on awards based on specific calculations, there could be disputes over the adequacy of compensation received by the businesses affected, which may lead to further legislative scrutiny or amendments.