The challenge, and opportunity, of 'getting to green' in Minnesota

Margaret Cherne-Hendrick is the senior lead for innovation and impact at Fresh Energy, a St. Paul-based clean energy nonprofit working to identify equitable, decarbonization strategies that advance the clean energy economy.

She spoke to MPR News’ Dan Kraker about her work and the challenges — and opportunities — of “getting to green” in Minnesota. 

Hear the conversation using the audio player above, or read a transcript of it below. Both have been lightly edited for clarity and length.

Dan Kraker: How do you frame the challenge that lies in front of us? How do you compartmentalize it?

Cherne-Hendrick: It is the challenge of not just our generation, but generations to come, right. I actually try to not compartmentalize it, because I think that's what's slowed down our work a little bit in the past is really thinking about these issues of how we move off of fossil fuels and on to clean energy solutions in silos. 

Generally, those silos have been categorized by economic sector. So [for example] we're thinking about buildings, and we're not thinking about the interactions that buildings have with, say, the transportation sector.

So I'm really trying to encourage folks to think about this from a systems-wide perspective. We have to move with an urgency and act at scale in a way that is unprecedented. So we're really trying to take a step back and think about, ‘Okay, we have a certain amount of time, we need to back out when we need to be off of fossil fuels.’

And we need to be setting interim goals that we're meeting expeditiously. We need to identify those end-uses, like internal combustion engines in vehicles, like furnaces in homes, that need to be off of gasoline, off of gas. How can we do that in a way that is going to harness our tools that we have in our decarbonization toolkit? 

Some of those tools are electrification; moving on to clean electricity that's carbon free, like wind and solar energy. And then some of those end-uses are going to require different tools for decarbonization, [including] low and zero-carbon fuels like green hydrogen, like renewable natural gas. We are thinking a lot about what decarbonization solutions are scalable, so we can deploy them as broadly as possible.

A good example that we're thinking a lot about is green hydrogen. Hydrogen has been very well advanced by some of the federal funding that we've seen in the Inflation Reduction Act, as well as the Infrastructure Investment and Jobs Act.

We’ve talked about hydrogen and the coming hydrogen economy for decades now. But a lot of folks now think with these investments that we're really on the cusp of making hydrogen a really big part of our fuel economy. 

So we are really looking at those opportunities to try to understand, okay, we can subsidize hydrogen production in a way that can be fully carbon-free with green hydrogen. So taking renewable electricity from wind or solar to power what's called an electrolyzer, which helps to split hydrogen off of a water molecule to produce what is going to be carbon-free hydrogen — green hydrogen. So we're pushing [to] get the cleanest hydrogen we can. 

And then we're taking a step back and saying, ‘Okay, who's going to need that hydrogen?’ And we really think that it's going to be end-uses that are going to be very, very technologically hard [and] cost-prohibitive to electrify, [areas where] decarbonization through electrification is not going to be the best use case.

Good examples of that are heavy industry that requires really high temperatures, any sort of heavy industrial process, or things like fertilizer production, which is produced primarily using natural gas today. And in some instances, really long-haul, heavy duty transportation. 

Where we are taking a more critical eye, is in other areas like light duty vehicles, that are very ripe for electrification. We've got the technology in hand. 

[In] the building sector, I think there are a lot of folks who would say, let's throw some of that green hydrogen into the distribution pipeline and help to offset some of the natural gas that we're using in the building sector. And we say, ‘well, that's a very expensive solution. There are some very real technical limits on how much you can mix into the natural gas pipeline.’ So that is really an instance in which we think that district energy opportunities — where we have really low energy usage, high energy efficiency — that's a better way to decarbonize than using green hydrogen. 

So, I think that's an illustrative example of how we're thinking about, okay, what are the decarbonization solutions that we have in hand? Are these ready to scale today?

And how do we think about deploying those in a way that's not going to slow the pace of decarbonization in any one sector of the economy, recognizing that we're all going to be trying to decarbonize simultaneously?

Dan Kraker: I’ve often heard it described that what we need to do is [first] make the grid clean through wind, solar, etc.; and then electrify everything. Is that the broad outline of what we need to do?

Cherne-Hendrick: I think in Minnesota, we are in such a great position right now, because we just passed 100 percent carbon-free, which is the bill that really makes sure that we are going to be completely carbon-free in the electricity that is generated and consumed in Minnesota by 2040. So that sets us on a really excellent path to decarbonize our electric mix, and therefore guarantee that what we are electrifying is going to be served with electricity that's carbon free.

That's not a guarantee in all places. In the Midwest, in particular, we have historically been so reliant on coal and natural gas, it's a really big step for us in the Midwest. We just have just a wealth of wind power already, and are looking to build a lot more solar. And again the federal investments are really going to help with that. 

You said ‘electrify everything.’ So I think we're taking a more nuanced approach. The way we're thinking about it is ‘electrify everything that we can.’ And I say that because we live in the Midwest. We have very cold climates. We are a state that has a huge agriculture sector, we have a huge industrial sector. And again, some of those processes are just not going to be easily electrified. 

We are moving towards a goal in the state of Minnesota — which aligns with where a lot of the climate science is telling us we need to go — we need to be carbon neutral across the economy by 2050. 

In those very last sort of hold-out parts of the economy that are going to be really hard to decarbonize — industry and agriculture — we as a society have not focused as much on those pieces yet, because they're the hardest, and they're going to be the most expensive. And so that's where we're really going to have to deploy those low and zero-carbon fuels. 

But by far and away, much of what we can do economy-wide can be accomplished on the decarbonization front with electrification. 

I think what's really important to acknowledge is that not only do we need to make sure our electricity is generated through green methods — solar, wind, a lot of battery storage is needed too — we also need to make sure that we are building up the grid.

We're going to need a lot more electricity, so we're going to need to build it out quickly, we need to make sure that that electricity can flow to the folks that are going to be using it. So we need a lot more transmission. And we need that grid to be really redundant and resilient. 

Because we're going to be relying on electricity [that is] intermittent — wind is primarily blowing at night and solar is mostly of course generated during the day — we need to guarantee that we have storage and we have other means of moving electricity around when the wind not is not blowing, and then the sun is not shining. 

So building out the grid of the future to serve all this new electric demand, while we also electrify end-uses that are being currently served by fossil fuels, that is the grand challenge. And we can't afford to sequence it. We need to be doing it at the same time. 

But it's also an opportunity. We have to build out a really energy efficient, cost effective and carbon free economy. And we have to do it quickly. And I think the biggest challenge here is how do we also do it equitably? How do we do it in a way that's not going to leave behind the communities that are already most impacted by climate change?

How do we make sure that this energy transition is not only not leaving these folks behind, but bringing the folks that are going to be most impacted by these policies to the table to help craft those policies? 

We hear a lot about ‘Justice 40.’

Dan Kraker: Explain what that is? 

Cherne-Hendrick: It’s a commitment to pass through roughly 40 percent of funds to disadvantaged, underserved communities who are going to need them most. How that 40 percent is calculated is squishy. But suffice to say, the Justice 40 concept embodies this notion that we need to be empowering folks who are going to be impacted most by this energy transition to help navigate the transition. 

That really is an acknowledgement that we have not done this well in the past. We've made some real mistakes in how we transitioned off coal, in terms of how it's impacted the communities where coal-fired power plants have been sited; it's impacted folks who are in the mix of the labor transition. 

Those are pieces that we need to be thinking about really critically as we move this forward. We cannot have change occur only on the pocketbooks of those early adopters, those people who can most afford it and benefit most. That's just not the way that we can do this in an equitable fashion. 

And we can't expect that really large transitions like this are going to be done on the backs of individual ratepayers. For example, in the building sector, it cannot be up to folks to make hundreds of minute decisions on exactly how to retrofit their homes to be more energy efficient, and then switch out their furnace for a heat pump, and then make sure that they're plugging into every single subsidy that's available both at the federal level and state level. 

So I think [the challenge] is stepping back [and] trying to understand how we make the most of this once in a lifetime opportunity. With the sheer flood of federal funding that's coming down the pipeline, the matching state funds, the additional state funds that are coming in, also the grand challenge is making sure that folks understand the opportunity and are able to access the opportunity, and are able to stack these benefits in a way that maximizes cost effectiveness and energy efficiency. 

And that is not an easy feat. For how much money is coming down the pipe, there's still layers and layers of bureaucracy. Folks are still trying to figure out what is the best way to implement these programs in a way that folks understand and can access. And anytime you have to apply for funding it is just a huge amount of work and resources that folks don't necessarily have to bear. 

Those are some of the challenges that we're identifying and trying to overcome here as we're making sure that as these funds start to roll. And they're rolling [out] slowly. We are moving at the pace that the federal government is moving.

They are moving as fast as they possibly can. But it's still a year out, for example, from when the inflation Reduction Act passed, and we're still waiting for things to start to pick up and flow. 

MPR News: Could you talk a little bit more about equity? For people with means and the desire to take part in this transition, it seems challenging like you said to figure out where the money is, and what's best to do.

But then when you think about someone who’s renting, or can’t afford to buy an EV, or doesn’t have the time to really think about it when they’re focused on work and their kids, [it seems even more challenging].

So it seems overwhelming to think about how this transition can benefit everybody, and how we reach everybody to be a part of this. Are you optimistic we can do that? 

Cherne-Hendrick: I'm choosing to be optimistic, because I think that's the only thing that we can do. We have to seize the opportunity, we have to make the money work for us. Right? What we haven't seen in the past is a lot of this type of federal funding be so targeted to low and moderate income families.

And we are definitely seeing that, especially on the building side with funds that are income qualified. They're not excluding, as we have done in the past, folks who are renting and don't own their properties to be able to partake. 

Now, that being said, I know how hard it is for folks to make those individual decisions– even if you do own your property– to try to figure out, what contractor do I need to come in and install my heat pump? Will it work in a cold climate? Is it the right one? Do I need to keep a furnace on backup? Can I have a backup that's electric? Are my windows up to par? That is a lot for an individual.

And so we are going to work as tirelessly as possible to make sure that folks are connected to all of those great benefits to help replace appliances, to help upgrade homes, and make sure that they are as energy efficient as possible.

We are also pushing for solutions that are going to be rolled out at scale. And sometimes that's going to be through the utilities. That's why we spend a lot of time working at the Public Utilities Commission to really put pressure on investor owned utilities to also be going out to access these federal funds. 

We need to be taking advantage of those funds to think critically about what the utility business model of the future looks like. That's especially important on the gas side. If you are in the business of selling a product, natural gas, that is … 80 times more potent [of a] greenhouse gas than CO2 — that is antithetical to federal as well as state greenhouse gas reduction goals. We have to shift that utility business model to be one where we are in line with greenhouse gas reduction goals.

So we're really thinking critically in the Midwest. What does that new utility business model look like for gas utilities, and especially in cold climates? What’s a way to equitably advance an energy transition that keeps people in their jobs that makes sure that we're delivering reliable heating and cooling and makes sure that we're putting the least pressure possible on the electric grid, recognizing that everyone else is going to be electrified at the same time?

So we're doing things like pushing the utilities to really consider what is the potential for rolling out technologies like ground source district energy systems, so moving around heat in the form of water or steam instead of a carbon based fuel.

If you're interconnecting buildings that are dumping waste heat into the system, which then other buildings take up, you can get efficiencies that are sometimes eight times more efficient than distributed natural gas.

So those are the sorts of important scalable solutions at the utility level, neighborhood by neighborhood instead of individual ratepayer by ratepayer that we're thinking about too. So what are the ways that we can keep costs down and affect change at scale that's not going to leave folks behind.

MPR News: Lastly I wanted to ask you about opportunities as well. We've talked about some of the challenges. They’re immense, but I know that can also lead to opportunities. 

Cherne-Hendrick: With any large-scale, economy-wide transition like this, there's, rightly so I think, anxiety around what change looks like, both from the consumer perspective, as well as from the labor force.

But I think there's every opportunity, especially from Minnesota's perspective, to be a leader from the north, and how do we make this work. I always say what you can do in Minnesota can be really a model for how that works at the federal level, too. 

We haven't talked a huge amount about transportation, but on the transportation side so far what we have seen is that this federal investment has translated into a lot of manufacturers building plants in the US for batteries, for vehicles, for chargers. That is a real opportunity to bring jobs to Minnesota.

There's no reason that we can't be a manufacturing hub in Minnesota, for transportation or otherwise. And so I think that sort of golden opportunity, realizing it, seizing it, and taking advantage of making Minnesota a hub for production and job growth, is everything that we should be leaning into right now. 

It's hard to hold this tension of wanting to move really quickly, and then also untangling the very complex reality of what implementing all these federal and state funding programs looks like, and then layered on to that, this lens of wanting to do this work equitably.

It's a lot to hold at one time. And I think we just have to get really comfortable with sitting with that tension, and also keeping up the momentum to move forward with this transition. 

My sincere hope is that as we continue [access] these dollars, we start to see folks leaning into that economic opportunity. We're starting to see it in the Sunbelt. That’s where a lot of EV manufacturing is happening.

And so I just think there's every opportunity for Minnesota to lead on this as well. And that's really what gives me a lot of hope on this.

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