Commentary: Big Tent Ideas

Expensive State Clean Energy Mandates: The Math Nobody Ran

Windtech/Wikimedia Commons

Thirteen states from Vermont to Hawaii have written a hard deadline into law: 100 percent carbon-free (CO2-free) or “clean” electricity, most by 2040 or 2045. Lawmakers sold these mandates as a bargain: cheaper power alongside cleaner air. Voters in those states are struggling with ever-increasing electricity bills. Which are increasing faster than non-mandate states.

The metric politicians lean on to make that case is the “levelized cost of energy” (LCOE), which ranks wind and solar as the cheapest sources of generation on the grid. The U.S. Energy Information Administration itself cautions that the ranking is misleading because LCOE reflects the cost to build and run a single generator. It says nothing about whether that generator can deliver power at 6 p.m. on a windless February evening, exactly when a grid needs it most.

Energy analysts, Isaac Orr and Mitch Rolling, answer the question EIA’s own number dodges. Their “Always On Levelized Cost of Energy” (AOLOC) model adds back everything a bare LCOE figure leaves out: backup generation, transmission, overbuilt capacity and the power curtailed to keep intermittent resources reliable.

Run through Minnesota’s grid, the model puts wind’s real cost at roughly $272 per megawatt-hour and solar’s at $472. Treat those as modeled estimates, not quoted market prices, but they are the most honest attempt anyone has made to price what these mandates actually cost.

Set those figures next to new natural gas plants, a resource that needs no matching backup fleet and can be built wherever demand is, saving transmission buildout, rather than wherever the wind happens to blow, which needs vast amounts of expensive transmission.

EIA’s own projection for gas entering service in 2030 runs $46 to $49 per megawatt-hour, and an already-paid-off coal plant costs less still. Counted fully, wind runs at least double. Solar runs at least triple.

Minnesota is where the theory meets the invoice. Its 100 percent carbon-free law passed in 2023, and the state’s largest utility, Xcel Energy, has since asked regulators to approve $490.7 million in rate increases across 2025 and 2026, a 13.2 percent jump it partly attributes to cleaner generation investments. Regulators trimmed that to a 5.2 percent interim increase but did not reverse the direction.

Twelve more states carry the same 100 percent commitment on their books. Together, representing more than a quarter of the nation’s electricity use, they all lean on the same LCOE sales pitch that Minnesota did.

A nationwide review of utility rate filings by Orr and Rolling already shows the pattern in the data: states with these mandates sought rate increases 32 percent larger than states without them from 2020 through 2025, with prices climbing at nearly double the pace of non-mandate states, despite slower population growth.

Reliability is eroding on the same timeline. MISO, the grid operator serving Minnesota and fourteen other states, already counts wind and solar for only a small fraction of their rated capacity during the hours the system is under the most strain when it is very hot or cold, because they cannot be counted on to deliver when needed.

That is not a regional quirk. The North American Electric Reliability Corporation’s latest long-term outlook puts 13 of the 23 grid regions it tracks nationwide, including MISO, PJM, ERCOT, and much of the West, at elevated or high risk of a shortfall within five years, as retiring plants outpace the firm generation meant to replace them.

Wind and solar cannot fill that gap on command, and NERC warns the shortfall will force emergency responses, such as rolling blackouts, and no governor wants to explain that to constituents.

None of this argues against cleaner electricity. It argues against buying it blind. Before a state locks in a mandate and before a utility retires one more dispatchable plant, regulators should require a single disclosure: the full cost of the replacement power, including backup, transmission, storage, subsidies, and curtailment, not just the price of the generation.

Voters were promised a bargain. They are learning that this was a false promise. Electricity is far too important to ignore facts and charge ahead with ideology-driven, expensive, often dangerous net-zero mandates.

Frank Lasee is President of Truth in Energy and Climate.

The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.