The fossil fuel and ethanol industries made a pitch Thursday for a new arm of the North Dakota Industrial Commission meant to advance cleaner energy technologies.
Critics expressed concerns about subsidizing the energy sector and said the proposal gives unequal treatment to renewable power.
House Bill 1452, introduced by Rep. Glenn Bosch, R-Bismarck, would establish the Clean Sustainable Energy Authority. The agency would be tasked with overseeing the distribution of $25 million from North Dakota’s general fund in the form of grants and loans for projects that “reduce environmental impacts and use energy sources derived from within the state.”
“We really, truly need to become the world leader in the production of fossil fuel energy but it does need to do what consumers are demanding,” North Dakota Petroleum Council President Ron Ness told the House Energy and Natural Resources Committee. “We’re in a battle between producing states and consuming states right now.”
Ness referenced the flurry of orders from the White House aimed at tackling climate change during the first few days of the Biden administration, prompted by growing public demand to take action to stop global warming.
“We know the climate activists are coming after us,” he said. “So what can we do as a state to ensure we do not leave 800 years of coal in the ground or leave one of the top 10 oil fields in the world undercapitalized and underdeveloped?”
The state has taken several steps already to facilitate energy research, including establishing an official partnership with the University of North Dakota’s Energy & Environmental Research Center and developing a fund under the Industrial Commission to advance technologies such as projects to capture carbon emissions from coal and ethanol plants, said Jason Bohrer, president and CEO of the Lignite Energy Council, a trade group for North Dakota’s coal industry.
The Clean Sustainable Energy Authority would complement those steps, amounting to “a structural increase and improvement over what we have to allow commercial demonstration to go forward,” he said.
Dakota Resource Council Executive Director Scott Skokos said that while his group supports the sustainable use of North Dakota’s resources, the bill “seems extremely skewed.” It’s geared toward the oil, coal and ethanol industries, he said.
“To call it a ‘clean and sustainable’ energy authority, I think is disingenuous,” he said.
The authority would be made up of a 15-person board, including seven voting members. Its membership is one of the sticking points for critics of the proposal.
Of the voting members, five would come from various arms of the Industrial Commission, including two from the Lignite Research Council, two from the Oil and Gas Research Council and one from the Renewable Energy Council. Others would include a lawmaker and a representative from the Western Dakota Energy Association, which is made up of oil- and coal-producing counties, cities and school districts.
Skokos said there should be greater representation from the renewable power sector.
“We have to recognize in this state that the solar and wind industries are also a viable energy industry,” he said.
North Dakota’s wind industry has boomed over the past decade with dozens of wind farms popping up across the prairie. No utility-scale solar farms exist in the state, though several smaller projects are operating.
The rise of the wind industry has occurred at the same time the state's coal industry has faced financial challenges amid competition from renewables and natural gas.
Dustin Gawrylow, managing director of the North Dakota Watchdog Network, said the bill ought to include a way to phase out the Clean Sustainable Energy Authority if it doesn’t achieve its goals.
“If we’re going to be going down the road of helping these industries move forward, we need to make sure it isn’t in a protectionist way and it isn’t in a subsidy way,” he said.
Gerald Bachmeier, CEO of the Red Trail Energy ethanol plant in Richardton, supported the bill but requested another member from the Renewable Energy Council be added to the board. The council is focused on wind, biofuels and geothermal, among other types of energy.
Red Trail Energy is on the verge of applying for a permit to operate the state’s first carbon storage project.
Others involved in carbon projects spoke in favor of the bill, including a representative from the Minnkota Power Cooperative, which is working toward building a major capture and storage facility at the Milton R. Young Station, a coal-fired power plant in Oliver County. The project seeks to capture 90% of the facility’s carbon emissions and bury the gas underground.
Ness said the Clean Sustainable Energy Authority has been in the works for months and stems from discussions of the EmPower Commission, an energy policy advisory group for the state.
The authority also would be tasked with creating an environmental, social and governance policy for North Dakota, which it would present to the Legislature.
Such policies are trendy. Investors and companies are increasingly adopting them to guide socially conscious business decisions. The movement has caused headaches for North Dakota’s oil and coal industries as companies seek investors.
The committee did not vote on the bill Thursday.
Reach Amy R. Sisk at 701-250-8252 or email@example.com.