Sec. 4.

new text begin [216B.68] DEFINITIONS, MERCURY EMISSIONS REDUCTIONS.
new text end

Sec. 5.

new text begin [216B.681] MONITORING MERCURY EMISSIONS.
new text end

new text begin By July 1, 2007, a public utility that owns or operates a qualifying facility shall
install, maintain, and operate continuous mercury emissions monitoring systems on
coal-fired electric generation units that the utility may include in a mercury emissions
reduction plan under section 216B.682. The monitoring systems must use methods
set forth in federal mercury regulations or other methods as may be approved by the
agency. The data from monitoring systems or other methods of measurement approved
by the agency associated with a utility's qualifying facilities must be used to establish a
baseline for mercury emissions reductions under section 216B.682. The public utility shall
report to the agency the quality assured and controlled data produced from the systems
implemented pursuant to this section on a quarterly basis thereafter.
new text end

Sec. 6.

new text begin [216B.682] MERCURY EMISSIONS REDUCTION PLANS.
new text end

new text begin (a) By December 31, 2007, for dry scrubbed units and by December 31, 2009, for
wet scrubbed units, a public utility that owns or operates a qualifying facility shall develop
and submit to the Pollution Control Agency and the Public Utilities Commission plans to
reduce mercury emissions in this state. A public utility filing a plan for a wet scrubbed
unit on or before December 31, 2007, may file a plan for any other wet scrubbed unit at
its qualifying facility by July 1, 2011. Mercury emissions reduction initiatives must be
implemented by December 31, 2010, at dry scrubbed units, and by December 31, 2015, at
wet scrubbed units.
new text end

new text begin (b) A public utility must file a set of plans under paragraph (a) that, taken together,
are designed to achieve total mercury reductions among the utility's Minnesota facilities
equivalent to a goal of 90 percent reduction of mercury emissions at the utility's targeted
units by December 31, 2015.
new text end

new text begin (c) The utility may also submit one or more alternatives to the plans required under
paragraph (b). The alternatives must be designed to achieve mercury emissions reductions
at its qualifying facilities greater and earlier than required under federal mercury
regulations. The utility shall also provide information as to how the utility would have
planned to meet federal mercury reduction requirements in the absence of this legislation
and the estimated cost and timing of meeting federal mercury reduction requirements.
new text end

new text begin (d) For each required and alternative plan submitted pursuant to this subdivision,
the utility shall present information assessing that plan's ability to optimize human health
benefits and achieve cost efficiencies. The utility shall assess how each plan balances
environmental benefits with the associated costs, considering the impact of the resulting
electricity costs on both the utility's customers and the state's economy. Plans must
provide the cost, technical feasibility, and mercury emissions reduction expected for each
option. Plans may also provide measures to reduce the cost and maximize the flexibility of
each option, including, but not limited to, mercury emissions reductions achieved through
pretreatment of the coal burned at the facility, averaging mercury emissions reductions
among different generating units at the same plant and achieving equivalent mercury
emissions reductions on other plants in the public utility's electric system in Minnesota.
The plans may specify permit targets or conditions proposed by the public utility for each
mercury emissions control option, including, but not limited to, numeric emission targets,
percent removal expectations, emission control technology installation and operative
requirements, or work practice standards.
new text end

new text begin (e) Mercury emissions reductions under a plan approved by the commission under
section 216B.1692 before January 1, 2006, may not be counted toward total mercury
emissions reductions of a plan under this section.
new text end

Sec. 7.

new text begin [216B.683] OTHER ENVIRONMENTAL IMPROVEMENT PLANS.
new text end

new text begin In order to encourage a utility to address multiple pollutants, a utility required to
submit mercury reduction plans under sections 216B.68 to 216B.688 may also propose
plans and associated emission reduction riders addressing investments in additional
pollution control equipment and related expenses needed to comply with state or federal
statute or regulation that became effective after December 31, 2004. The plans must
propose to implement emission control initiatives that exceed and are implemented in
advance of state or federal requirements. The utility must show that plans submitted
under this subdivision and any related riders are the least-cost alternative for complying
with state and federal regulations.
new text end

Sec. 8.

new text begin [216B.684] EMISSIONS REDUCTION RIDERS.
new text end

new text begin (a) A public utility required to file a mercury emissions reduction plan under section
216B.682 may also file for approval of an emissions reduction rate rider pursuant to
section 216B.1692, subdivision 3, for its mercury control and other environmental
improvement initiatives under sections 216B.68 to 216B.688. The emissions reduction
rate rider may include recovery of costs associated with the installation of continuous
mercury emission monitoring systems, ongoing operation and maintenance costs
associated with the utility's mercury control initiatives, and any studies undertaken by
the utility in support of the mercury emissions reduction plan required under section
216B.682, in addition to the cost recovery provided by sections 216B.1692, subdivision 3.
The utility may propose to phase in the emissions reduction riders to recover these costs
over the development and life of the projects.
new text end

new text begin (b) Each mercury emissions reduction rider approved by the commission must
include performance-based financial incentives to encourage the utility to exceed the 90
percent mercury emissions reductions required in the plan filed under section 216B.682.
These incentives may include increased returns on investments or other performance-based
incentives. The commission shall structure the financial incentives to escalate for each
additional increment of mercury emissions reductions achieved by the utility above the 90
percent mercury emissions reductions required in the plan filed under section 216B.682.
new text end

Sec. 9.

new text begin [216B.685] ENVIRONMENTAL ASSESSMENT.
new text end

new text begin The Pollution Control Agency shall evaluate a utility's mercury emissions reduction
plans and alternatives filed under sections 216B.68 to 216B.688, and submit its evaluation
to the Public Utilities Commission within 180 days of the date the plan is filed with the
agency and commission under subdivision 3. In its review, the agency shall:
new text end

new text begin (1) assess whether the utility's plan under section 216B.682, paragraph (b), meets
the requirements of that paragraph;
new text end

new text begin (2) evaluate the environmental and public health benefits of each plan submitted
under section 216B.682, including benefits associated with reductions in pollutants other
than mercury;
new text end

new text begin (3) assess the technical feasibility and cost-effectiveness of technologies proposed
for achieving mercury emissions reduction in each plan submitted; and
new text end

new text begin (4) advise the commission of the appropriateness of each plan.
new text end

Sec. 10.

new text begin [216B.686] COMMISSION APPROVAL.
new text end

new text begin (a) The Public Utilities Commission shall review and evaluate a utility's mercury
emissions reduction plans submitted under this section. In its review, the commission
shall consider the environmental and public health benefits, the agency's assessment of a
technology's technical feasibility, competitiveness of customer rates and power supply
costs, and cost-effectiveness of the utility's proposed mercury control initiatives in light
of the agency's report under section 216B.685. For multi-emissions reduction plans, the
commission shall consider the overall environmental and public health benefits, total
costs, and competitiveness of customer rates and power supply costs.
new text end

new text begin Within 180 days of receiving the agency's report, the commission shall approve a
utility's mercury or multi-emissions reduction plans that the commission reasonably
expects will be technically able to achieve, by December 31, 2015, substantial mercury
emissions reductions and associated environmental and health benefits among the utility's
Minnesota facilities in a manner that does not impose excessive consumer and power
supply costs. In approving the plans, the commission shall attempt to achieve the greatest
level of mercury reduction that can be obtained without imposing excessive costs on
ratepayers.
new text end

new text begin If the commission is unable to approve the utility's 90 percent reduction plan
submitted under section 216B.682, paragraph (b), the commission shall, in consultation
with the agency, order the utility to implement the most stringent mercury control
alternatives proposed by the utility under section 216B.682, paragraph (c), that will
achieve the maximum mercury emissions reductions technically feasible and protective of
the public health and environment without imposing excessive consumer costs.
new text end

new text begin (b) The commission shall review and evaluate a utility's plan and associated
emissions reduction rider for other environmental improvement initiatives submitted
under section 216B.683. Within 180 days of receiving the agency's report prepared under
section 216B.1692, the commission shall approve the plan and associated emissions
reduction rider if it complies with applicable state and federal regulations and is the
least-cost alternative.
new text end

new text begin (c) Section 216B.1692 applies to plans and emissions control riders proposed under
sections 216B.68 to 216B.688, except that projects included in a plan approved under
those sections are deemed to be qualifying projects for the purposes of section 216B.1692;
and section 216B.1692, subdivision 5, paragraph (c), and subdivision 6, do not apply to
plans or riders submitted under sections 216B.68 to 216B.688. Commission approval of
an emissions reduction plan under sections 216B.68 to 216B.688 includes approval of an
emissions reduction rider associated with that plan, if one was submitted by the utility.
Nothing in sections 216B.68 to 216B.688 requires a utility to convert a wet scrubbed unit
into a dry scrubbed unit as part of an emissions reduction plan.
new text end

Sec. 11.

new text begin [216B.687] IMPLEMENTATION AND OPERATION.
new text end

new text begin (a) A public utility required to file a mercury emissions reduction plan under
section 216B.682 shall implement the plan as approved by the commission under section
216B.685.
new text end

new text begin (b) During the startup period, except as required by federal regulation, any mercury
emission reduction incorporated into a qualifying facility's permit as established under
the plan is a state-only condition of the permit and is not subject to enforcement by the
agency. If, after the startup period ends, it is determined that the qualifying facility is
able to comply with the mercury emissions reduction, the agency shall incorporate the
mercury reduction into the facility's permit as an enforceable state-only condition. If,
after the startup period, despite the utility's reasonable best efforts consistent with the
approved plan, the equipment installed at a unit under an approved plan fails to achieve
the mercury reduction expected in the approved plan, the agency shall revise the permit
for the qualifying facility to reflect the actual mercury emissions expected from the unit
and incorporate that mercury emissions reduction as an enforceable state-only condition
in the facility's permit. The utility shall report periodically to the agency of its efforts to
optimize the operation of installed equipment, and the agency shall revise the unit's air
permit within five years of initial operation, to ensure optimal operation of equipment
installed under a plan approved pursuant to sections 216B.68 to 216B.688.
new text end

new text begin (c) For qualifying facilities using both dry scrubbed and wet scrubbed units, the
agency may establish permit limits as set forth in paragraph (b) for each individual
unit. After the startup periods for all units at the qualifying facility have concluded and
the actual mercury emissions for the units expected under the approved plan have been
determined, the agency may establish a single enforceable state-only mercury emission
limit for the qualifying facility covering all units at that facility.
new text end

Sec. 12.

new text begin [216B.688] RELATIONSHIP TO STATE AND FEDERAL
REGULATIONS.
new text end

new text begin Mercury emissions reduction equipment installed under this section fulfills all
applicable requirements related to mercury emissions from a qualifying facility, including
but not limited to any mercury-related requirements related to total maximum daily
loads under the federal Clean Water Act. Except as otherwise provided in this section, a
targeted unit implementing a mercury emissions reduction plan under sections 216B.68 to
216B.688 shall not be required to undertake additional investments to reduce mercury by
state law or regulation. The agency shall implement requirements of federal law in the
most flexible manner approved by the United States Environmental Protection Agency.
new text end