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Bioenergy Regulation & Policy


All biodiesel fuel sold or offered for sale in Minnesota for use in internal combustion engines must contain the following percentage of biodiesel fuel oil by volume. “Biodiesel fuel” means a renewable e, biodegradable, mono alkyl ester combustible liquid fuel that is derived from agricultural and other plant oils (excluding palm oil) or animal fats. 

May 2009: 5 percent
May 2011: 10 percent
May 2013: 15 percent
May 2015: 20 percent

The minimum content levels are effective during the months of April, May, June, July, August, September, and October only. The minimum content for the remainder of the year is five percent. 

Status: It is estimated that the state’s B5 requirement is replacing about 40 million gallons of diesel fuel with domestic, renewable biodiesel—and Minnesota’s 65 million gallons of biodiesel production capacity can easily meet that demand. Before an increase from 5 percent can be implemented the law (Minn. Stat. § 239.77, Subd. 2 (a)) requires the commissioners of agriculture, commerce and the pollution control agency to determine whether four statutory conditions have been met. These conditions involve federal standards for blend specifications, the production capacity of biodiesel in Minnesota, the amount of infrastructure and regulatory protocol for biodiesel blending, and the source of feedstocks. 

After much discussion and in consultation with the Minnesota Biodiesel Task Force and with stakeholders, the commissioners agree that these four conditions have not been met completely in Minnesota. Therefore, the commissioners recommend a one-year delay (May 31, 2013) in the implementation of the B10 minimum content requirement.

Cellulosic Biofuel Development Goal  Minn. Statute 41A.10, Subd. 2
The state cellulosic biofuel production goal is one-quarter of the total amount necessary for ethanol use required under section 239.791, subdivision 1a, by 2015 or when cellulosic biofuel facilities in the state attain a total annual production level of 60,000,000 gallons, whichever is first. 

Oxygenated Gasoline Content Mandate  Minn. Statute 239.791 Subdivision 1 - minimum ethanol content required  (2005)

a. Except as provided in subdivisions 10 to 14, a person responsible for the product shall ensure that all gasoline sold or offered for sale in Minnesota must contain at least the quantity of ethanol required by clause (1) or (2), whichever is greater:
  1. 10.0 percent denatured ethanol by volume; or
  2. the maximum percent of denatured ethanol by volume authorized in a waiver granted by the United States Environmental Protection Agency.

Status: Minnesota has 21 ethanol plants with a total annual production capacity of about one billion gallons. Ten of the 21 ethanol plants are farmer-owned co-operatives, bringing direct economic returns to farmers and rural communities. Ethanol consumption in Minnesota is about 28 percent of the state’s total production with the remaining 72 percent exported. More than $3 billion in Minnesota’s economic output is created per year from this effort to diversify sources of fuel supply through community-based energy production. 

Renewable Energy Production Incentive  Minn. Statute 216C.41 Subdivision 1 - Definitions

The definitions in this subdivision apply to this section include:

  • "Qualified hydroelectric facility" 1.5 cents per kilowatt-hour.
  • "Qualified wind energy conversion facility" 1.0 cent per kilowatt-hour
  • "Qualified on-farm biogas recovery facility" 1.5 cents per kilowatt-hour.

Subd. 5. Amount of payment; wind facilities limit.
a. An incentive payment is based on the number of kilowatt-hours of electricity generated. The amount of the payment is:
c. There is annually appropriated from the renewable development account under section 116C.779 to the commissioner of commerce sums sufficient to make the payments required under this section, in addition to the amounts funded by the renewable development account as specified in subdivision 5a. 

Subd. 4. Payment period.
a. A facility may receive payments under this section for a 10-year period starting from the date the facility begins generating electricity. No payment under this section may be made for electricity generated:
  1. by a qualified hydroelectric facility after December 31, 2021;
  2. by a qualified wind energy conversion facility after December 31, 2018; or
  3. by a qualified on-farm biogas recovery facility after December 31, 2015.
Twenty-five by Twenty-five goal  Minn. Statute 41A.11
It is the goal of the state that no later than January 1, 2025, the state's agricultural, forestry, and working land should provide from renewable resources not less than 25 percent of the total energy consumed in this state while continuing to produce safe, abundant, and affordable food, feed, and fiber.