Item Description:
title
Amd 1 to Agmt PR00007357 with Kutak Rock LLP for legal services related to renewable energy, ext term to 12/31/27, incr NTE by $100,000 for a new total NTE of $200,000
end
Resolution:
body
BE IT RESOLVED, that Amendment 1 to Agreement PR00007357 with Kutak Rock LLP for legal services related to renewable energy, extending the agreement through December 31, 2027 and increasing the not to exceed amount by $100,000, for a new total not to exceed amount of $200,000, be approved; that the Chair of the Board be authorized to sign the Amendment on behalf of the county; and that the Controller be authorized to disburse funds as directed; and
BE IT FURTHER RESOLVED, that the Purchasing Director may extend the Agreement for an additional period of up to one (1) year and increase the Agreement’s not‑to‑exceed amount as necessary to fulfill County requirements.
end
Background:
As part of its Climate Action Plan and desire to reduce its carbon footprint, Hennepin County has installed several solar arrays on properties it owns. Facility Services currently operates seven active photovoltaic solar power array systems; all interconnected to the electrical grid at their respective county facilities and with net-metering arrangements to sell energy generated in excess of those facilities’ needs back to the electrical utility. In aggregate, these systems comprise nearly 5,000 individual solar panels which, in coordination with their inverters, are designed to supply a peak generating capacity of a little over 2 Megawatts of grid-ready power.
In the fall of 2024, the County entered into two Statewide Contracts with Xcel Energy which provide for net metering at two county facilities in Plymouth - a 720-kW array at the new Public Safety Services (PSS) headquarters and a second separate 620-kW facility at the nearby Adult Corrections Facility (ACF). While these facilities are in close proximity to each other, each array is separately metered and the electricity generated connects to the grid at separate substations. The two arrays are of critical importance, representing about two-thirds of the County’s aggregate active generating capacity.
The County entered into separate contracts with Xcel for each array. Under these contracts, Xcel agreed to purchase the power at the net metered rate, reducing the cost of these projects to the County. Xcel later informed the County that because both arrays are within one mile of each other, a federal rule applies to aggregate their output, which would exceed the 1 MW limit for net metered facilities. As such, Xcel would pay the County a lower rate for its electricity, costing County taxpayers as much as $1 million a year and making the project less financially viable.
Hennepin County believes it is eligible for the favorable rate under a Minnesota law designed to encourage the use of small power production and renewable energy sources. Hennepin County retained the Kutak Rock firm in 2025 to represent the County’s interest in utilizing net metering. Staff first met with Xcel to try to resolve the dispute. The County then submitted a comment in a proceeding before the Minnesota Public Utilities Commission where the one-mile rule was in question. When the Commission didn’t make a decision on the one-mile rule, the County filed its own complaint against Xcel, asking the Commission to rule that the County’s arrays are eligible for net-metering. In late 2025, the County filed its complaint against Xcel. The issues have now been briefed, and the parties are awaiting a hearing in front of the Commission.
This is an issue of first impression in Minnesota and affects other municipalities and other entities that have campuses with more than one solar array. If Hennepin County is successful, entities seeking to offset their own power consumption with multiple arrays in close proximity will benefit. The importance of this issue is highlighted by the number of amici participating in the County’s case. The following organizations filed amicus briefs in support of the County: League of Minnesota Cities; Solar Energy Industries Association; Minnesota Solar Energy Industries Association; Environmental Law & Policy Center (ELPC); Community Power; Minnesota Interfaith Power & Light (MNIPL); and Vote Solar.
In the event the County does not prevail at the Public Utilities Commission, the decision can be appealed.
Current Request: This request seeks authorization to negotiate Amendment 1 to Agreement PR00007357 with Kutak Rock LLP for legal services related to renewable energy, extending the agreement term from April 30, 2026, through December 31, 2027, and increasing the not‑to‑exceed amount from $100,000 to $200,000.
Impact/Outcomes: Approval of the amendment will enable Hennepin County to continue obtaining legal services from Kutak Rock LLP in support of renewable energy initiatives.
This request funds services that are: core services
recommendation
Recommendation from County Administrator: Recommend Approval