Federal tax credits and clean energy funding are driving big results for Minnesota—lower energy costs, job creation, and cleaner air. Since the Inflation Reduction Act (IRA) passed in 2022, Minnesota has seen:

• $2.4 billion in clean energy and manufacturing investments
• Nearly 2,500 new permanent operational jobs and 4,800 construction jobs
• 135 new clean energy facilities launched
• 7 new facilities now manufacturing Minnesota-made products

But all of this progress is at risk. Proposals to repeal clean energy programs could slam the brakes on growth. In just two months, national rollbacks have already halted over 60 clean energy projects and 42,000 announced jobs. 

For Minnesota, the impact would be severe:

• $4.1 billion drop in GDP by 2030
• Over 13,100 jobs lost by 2030; nearly 11,500 in 2035
• 270+ more per year in household energy bills by 2035
• 3 million metric tons more CO2 pollution—equal to one coal plant’s emissions

According to a report from NERA, the North Central and Western region of the U.S. are projected to see the highest increase in electricity costs if tech-neutral tax credits are repealed.

Projected increase in delivered electricity price by 2029 if tech-neutral tax credits are repealed (analysis by NERA)

Key industries like manufacturing and construction would also be hit hard as clean energy demand and investments dry up.

The bottom line: keep Minnesota moving forward. Federal clean energy programs are delivering real results for Minnesota families, workers, and businesses. Repealing them would cost us jobs, raise our bills, and stall economic progress. Let's stay on track toward a cleaner, more affordable, more prosperous future.

Minnesota’s energy system relies on complex, global supply chains. Recent tariff-driven trade policies are already inflating energy costs and creating uncertainty for developers and manufacturers. The problem is particularly acute in Minnesota due to our dependence on imported energy from Canada.

The Inflation Reduction Act offers a more strategic path forward than tariffs by using targeted incentives to strengthen domestic supply chains, encourage clean energy investment, and reduce long-term reliance on volatile international markets.

Federal funding cuts to the Energy Assistance Program would put Minnesotans at risk for higher utility bills and power shutoffs

The federal government’s fiscal year 2026 budget proposal calls for the elimination of the Low Income Home Energy Assistance Program (LIHEAP) — a program that each year helps approximately 125,000 income-eligible households in Minnesota keep their heat and lights on.

Minnesota’s Energy Assistance Program, which is fully funded by LIHEAP, has consistently proven its value as an effective, efficient way to keep energy affordable for all Minnesotans.

For more than four decades, the federal government has been a reliable partner in funding energy assistance to ensure Minnesota families can heat their homes when freezing temperatures could be life-threatening.

This past winter alone, approximately 116,000 Minnesota households qualified for assistance, with an average benefit of $759. Two-thirds of those homes are in greater Minnesota and three-quarters are households with vulnerable individuals—those who are elderly, have disabilities, or have young children.

Congress Needs to Act Based on Fact, not Fiction

FACT: THERE IS NO OTHER PROGRAM THAT PREVENTS MINNESOTANS FROM GETTING THEIR UTILITIES SHUT OFF, AND THOUSANDS OF MINNESOTANS ARE DISCONNECTED EVERY YEAR FACT: ENERGY ASSISTANCE PROGRAMS BENEFIT EVERYONE

The energy assistance program helps lower costs for all utility ratepayers by reducing the number of unpaid bills passed on to other customers. Payments are made directly to the utility companies and fuel vendors that service households that qualify for assistance.

FACT: FRAUD CONCERNS ARE UNFOUNDED

Minnesota has a robust system of internal controls, with regular audits at both the state and federal levels, to prevent and detect waste, fraud, and abuse, including:

• Application verification procedures (including 3rd party verification) for identity and income
• Annual program audits, financial monitoring and centralized payment system
• Service provider desk monitoring
• Financial monitoring

See the National Energy Assistance Directors Association (NEADA) response for more information.

What’s at Stake for Minnesotans

Withholding federal funding for energy assistance would put thousands of Minnesotans at risk of having their heat shut off or being left without help when their furnace breaks down or their propane fuel tanks run dry. Families could be forced to choose between heating their homes and buying groceries or medications.

Minnesotans are relying on government at every level—federal, state and local —to act responsibly and to act based on our values.

The federal government must renew its longstanding and successful partnership with Minnesota to keep our homes safe and warm.

Cuts to environmental leadership program

As of March 27, 2025, the Minnesota Department of Commerce has been unable to access funds from the EPA for its Government-to-Government program funds. Termination of this assistance agreement will have a detrimental effect on the State of Minnesota, in particular, it will harm the State’s ability to address household’s energy burdens as well as health and environmental issues in homes of Minnesota residents.

We expect the federal government to be responsible and follow through with its contractual commitments.

Minnesota Management and Budget tracks all Minnesota terminated awards: Data and Reporting / Minnesota Management and Budget (MMB)

Our goal: reliable, affordable, and safe energy for all Minnesotans—even as the climate changes. Under the Zero by 2040 law, Minnesota is on track to use 100% carbon-free electricity by 2040. But new executive orders from the Trump administration pushing coal power threaten to derail our clean energy future.

Minnesota stands firm in our authority to regulate our state’s energy resources. The federal executive orders issued April 8, 2025, that attempt to increase coal power generation ignore facts

The facts:

Minnesota has a proven track record of delivering reliable, safe, affordable and increasingly clean energy to power our homes and businesses.

Our state has a comprehensive plan for phasing out coal plants and transitioning to 100% carbon-free electricity by the year 2040. The Zero by 2040 standard, which became state law in 2023, gives utility companies time to plan and allows for flexibility to ensure our electric grid maintains our strong track record of reliability.

In fact, our largest utility, Xcel Energy, has a plan in place to be 100% carbon-free by the year 2035 (Commerce press release, Feb. 20, 2025). 

These laws aim to keep coal online; coal generates harmful pollution that drives up health care costs, harms our health and environment through toxins like mercury, and emits more planet warming greenhouse gases per unit of energy than alternatives.