Red States Move To Stop Transmission Lines That Would Give Relief To Minnesota Ratepayers

By Brian Martucci, Minnesota Reformer

September 25, 2025

As Washington Republicans’ attacks on renewable energy and voracious data center electricity demand threaten to push electricity prices higher, utility commissions in five red states are fighting a widely supported effort to keep power bills in check.

They’ve filed a complaint asking federal energy regulators to halt development of a $22 billion slate of proposed high-voltage electric transmission lines that would expand an existing network stretching from Kentucky to Minnesota and the Dakotas. They argue the Upper Midwest’s main power grid operator dramatically overstated the lines’ financial and environmental merits while improperly allocating their construction costs to states that say they don’t need them.

On the other side is a motley coalition of electric utilities, tech companies, agribusinesses, environmental groups, a Republican governor and a couple potential 2028 Democratic presidential contenders who support the investment.

The new lines are expected to be in service by 2034, strengthening links between the windy, sunny Plains states and population centers further south and east.

The fight over the transmission lines highlights a key flashpoint in the energy sphere, as cheaper renewable energy runs headlong into a lack of transmission capacity and political hostility from Republican states.

“These improvements will save customers billions by avoiding costly inefficiencies and diversifying the market of generation resources across the region,” Gov. Tim Walz, who’s running for a third term, said in a Sept. 16 letter to the Federal Energy Regulatory Commission.

Michigan Gov. Gretchen Whitmer and Illinois Gov. J.B. Pritzker made similar arguments in letters earlier this month. Like Minnesota, Michigan and Illinois have statutory mandates for 100% carbon-free electricity — Michigan by 2040 and Illinois by 2050. Both governors are potential 2028 presidential candidates.

Gov. Kim Reynolds of wind-rich and mandate-free Iowa also pushed back on the five utility commissions’ complaint in a Sept. 5 letter hailing her state’s “all-of-the-above energy strategy” and name-checking President Trump.

The new infrastructure “will ensure continued reliability and resilience of the electric grid not only in Iowa but also across the region,” she wrote. Killing the new transmission investments, she added, could in turn stall seven nuclear reactors’ worth of new power plants in her state “by months to even years.”

The Indiana-based nonprofit that operates the electric grid in Minnesota and parts or all of 14 other states asserts the proposed lines — collectively known as LRTP Tranche 2.1 — could pay for themselves more than three times over.

That’s more than enough to qualify them as “multi-value projects” whose costs can be spread broadly across the territory of the Midcontinent Independent System Operator — known as MISO —including among ratepayers in Republican-controlled states without ambitious decarbonization goals. Stakeholders across the region had ample opportunity to weigh in on the proposed lines, a MISO spokesperson told the Reformer.

Before finalizing the tranche last year, MISO led “a collaborative process that included substantial stakeholder engagement as well as more than 300 meetings and feedback on the solutions and benefits,” MISO spokesman Brandon Morris said in an email.

Representing the public utility commissions of Montana, North Dakota, Mississippi, Louisiana and Arkansas, the complainants argued that the cost allocation effectively subsidizes the development of wind and solar farms far from population centers — and, by extension, Midwestern blue states’ clean energy goals. Instead of asking Montana and North Dakota to share the burden, they said states like Minnesota, Michigan and Illinois should build more clean energy and transmission within their own borders.

North Dakota’s GOP congressional delegation said much the same in a Sept. 11 letter urging regulators to grant the complaint and undo the cost allocation framework.

“The current approach to cost allocation is a subsidy scheme that alleviates certain states of the costs of their most aggressive energy policies…while out-of-state ratepayers bear the costs,” U.S. Rep. Julie Fedorchak and Sens. Kevin Cramer and John Hoeven wrote.

Belying the complaint, Minnesota is building plenty of clean energy on home soil. Renewables supplied 33% of the state’s electricity in 2024, according to Clean Energy Economy Minnesota, and a state law that accelerates permitting for wind, solar and other energy infrastructure took effect in July. Solar power projects approved by the Minnesota Public Utilities Commission since then will supply nearly a nuclear reactor’s worth of energy as they come online over the next few years.

But regardless of how it’s produced, experts say high-voltage transmission is needed to move electricity across longer distances.

“One of the key concepts of a renewables-based system is you want the grid to be bigger than the weather,” said Mike Schowalter of Fresh Energy, a St. Paul-based clean energy nonprofit.

Transmission lines built to deliver coal-fired power from North Dakota to Minnesota now catch a fair amount of wind, which supplies more than one-third of North Dakota’s electricity. North Dakota officials said during MISO’s stakeholder engagement process — before the utility commissioners’ July complaint — that they’d like to see more of that, Schowalter said.

East of the Rockies, power generally moves from west to east, but the prevailing flow often reverses during winter storms and other extreme weather events, Schowalter explained. To ensure everyone has enough power under the circumstances, utilities can either build lots of transmission and some power plants or lots of power plants and some transmission.

“The latter is far more expensive,” Schowalter said.

Building lots of new gas-fired power plants — something that’s already likely to happen as more AI data centers come online — could push up natural gas prices, Schowalter said. Because gas plants often set the local price of electricity, and fuel represents a significant fraction of their operating expenses, that means costlier power.

“The world that the complainants envision is one of more expensive electricity, and our AI industry is going to be at risk,” he said. “We are shooting ourselves in the foot.”

MISO appears to agree.

“The complaint jeopardizes the ability of MISO and its state partners to support the anticipated growth in electricity demand and would increase costs to customers within the MISO region by replacing an efficient, regional solution with a piecemeal one,” the grid operator said in a Sept. 9 filing that called the utility commissioners’ proposal “haphazard and unrealistic.”

Schowalter said a setback for Tranche 2.1 would mess with the delicate grid planning process and delay the arrival of new power plants that MISO, utilities and big customers were counting on.

Ironically, those delays could slow deployment of the the very gas plants meant to stabilize the grid as AI data centers multiply.

The Data Center Coalition, a tech industry trade group, made this point in a Sept. 9 filing.

Though Schowalter said MISO allocated less than 2% of total Tranche 2.1 costs to North Dakota and Montana, their utility commissions’ complaints make sense: They don’t want to pay at all for investments they believe benefit others.

The other three commissions’ motivations are less obvious because federal energy regulators have prevented MISO from allocating Tranche 2.1 costs across its southern region.

Colby Cook of the Louisiana Public Service Commission told the Reformer that LPSC “has always supported the MISO regional transmission planning processes” but joined the complaint for two main reasons.

The first was “the unreasonable underlying assumptions relied upon to justify these projects as (multi-value projects),” Cook said in an email. Beyond decarbonization benefits, the complaint objected to MISO’s estimates of how cost-effectively the new high-voltage lines could be built and the extent to which they would improve grid reliability and reduce the need for new power plants.

Second was the concern that Louisiana — though not currently required to pay the proposed new costs — could be on the hook later.

Legal representatives for the other four commissions did not respond to a Reformer request for comment.

Perhaps recognizing the need for a speedy resolution, the complainants themselves have asked federal regulators to expedite the complaint. It’s unclear whether the feds will agree.

In the meantime, a key piece of the Midwest’s future power grid is in limbo.

“If the complainants are successful, MISO would have to redo at least a year’s worth of work,” Schowalter said.

The Minnesota Reformer is an independent, nonprofit news organization dedicated to keeping Minnesotans informed and unearthing stories other outlets can’t or won’t tell..