Centerpoint Energy Proposes Innovations to Advance a Cleaner Energy Future in Minnesota

• Wide-ranging plan is proposed under the Natural Gas Innovation Act, a recent landmark state energy law
• Proposed projects expected to reduce carbon emissions, promote job creation and leverage millions of dollars in federal clean energy funding

MINNEAPOLIS, June 29, 2023 /PRNewswire/ -- CenterPoint Energy, Inc. (NYSE: CNP), Minnesota's largest natural gas utility, today proposed a wide-ranging set of innovative projects to reduce carbon emissions and advance a cleaner energy future in Minnesota. The proposal includes projects to promote made-in-Minnesota alternative gases such as renewable natural gas and green hydrogen, as well as pioneering technologies such as a networked geothermal district energy system and end-use carbon capture.

>> In Other News: Lapis Energy and Denbury Form JV to Develop CO2 Sequestration Project in SE Louisiana

The projects are part of a five-year innovation plan submitted under a recent landmark state energy law, the Natural Gas Innovation Act (NGIA). Passed with bipartisan support in 2021, NGIA created a new regulatory framework for natural gas utilities to invest in renewable energy resources and innovative technologies that help reduce Minnesota's greenhouse gas emissions.

The proposed plan requires approval from the Minnesota Public Utilities Commission (PUC) through a review process that is expected to take about one year.

According to the U.S. Energy Information Administration, more than two-thirds of Minnesota households depend on natural gas for heating, as do many businesses and industries in the state. CenterPoint Energy provides natural gas service to more than 910,000 residential, commercial and industrial customers in Minnesota.

"Natural gas utilities continue to be indispensable to meeting Minnesota's energy needs," said Christe Singleton, CenterPoint Energy's Vice President, Minnesota Gas. "CenterPoint Energy looks forward to the opportunities made possible by NGIA that will allow us to pursue multiple pathways to reduce or avoid emissions while continuing to provide the safe, reliable and cost-effective energy that our customers count on every day, especially during the coldest days."

CenterPoint Energy's innovation plan is expected to deliver significant benefits to Minnesota, including:

• Reduce or avoid an estimated 1.2 million tons of carbon emissions over the lifetime of the projects – equal to the annual energy use of about 150,000 homes or 14% of total emissions from natural gas supplied to CenterPoint Energy customers in Minnesota each year;
• Create an estimated 3,000 full-time equivalent jobs over the lifetime of the projects; and
• Leverage $17 million or more in federal clean energy incentives and support for Minnesota.

The plan includes 18 pilot projects and seven smaller research-and-development projects. These projects will deploy and evaluate a broad array of innovative resources and technologies. Key pilot projects include:

Made-in-Minnesota gas alternatives

Under NGIA, at least 50% of an innovation plan's total investments must be dedicated to procurement or distribution of certain alternative gases. CenterPoint Energy proposes investing in low-carbon, zero-carbon and even carbon-negative energy resources that can supplement or replace conventional natural gas, including:

• Renewable natural gas (RNG): RNG is produced by capturing and recycling organic waste materials from farms, food waste, wastewater treatment facilities and other sources to produce pipeline-quality gas. CenterPoint Energy would purchase RNG for its gas supply, reducing lifecycle greenhouse gas emissions attributed to the energy used by customers. The proposal includes obtaining RNG through requests for proposals (RFPs), as well as from a planned Hennepin County organics recycling facility in Brooklyn Park and a similar planned facility for the Ramsey/Washington County organics recycling program.
• Green hydrogen: Green hydrogen is produced by splitting water into oxygen and hydrogen using renewable electricity. It can be blended into the utility's natural gas supply or used directly in a dedicated system with an industrial or large commercial customer. CenterPoint Energy already has a green hydrogen pilot project online in Minneapolis and the plan proposes a second facility, powered by a dedicated solar array, on CenterPoint Energy property in the Mankato area.

Networked geothermal system

CenterPoint Energy would develop a networked geothermal system to provide building heating and cooling to a neighborhood currently served by the utility. A geothermal system uses a network of wells, water, pipes and pumps to pull heat out of the ground to deliver warmth to buildings in winter and to pump heat from those buildings back into the ground to provide cooling in summer.

Hybrid heating

The plan includes proposed incentives for homeowners and businessowners to install hybrid heating systems that use electric heat pumps with gas backup heating for the coldest weather. The plan would also evaluate new weatherization strategies to prevent energy waste and reduce emissions through deep energy retrofits of homes and construction of high-performance commercial buildings.

Industrial decarbonization

The plan proposes incentives and other support to industrial customers to improve efficiency and reduce emissions for high-heat processes such as glassmaking, concrete production and metal foundries. Electric heat pumps may be suitable for low-to-medium heat processes, while technologies such as carbon capture or green hydrogen may be needed for processes not amenable to electrification.

The total proposed budget for all projects is about $106 million over five years. If cost recovery is approved by the PUC, the estimated impact would be less than $1.50 on a typical residential monthly utility bill.

CenterPoint Energy is committed to a cleaner energy future by reducing carbon emissions, including a company-wide Net Zero goal by 2035 for Scope 1 and certain Scope 2 emissions. In addition, the company is committed to helping its residential and commercial customers reduce emissions from their end use of natural gas by 20-30% by 2035 (from a 2021 baseline). The total emission reductions under this Scope 3 goal are comparable to those for the company's combined Scope 1 and 2 Net Zero goals.

To learn more about the Natural Gas Innovation Act and CenterPoint Energy's proposed innovation plan, visit www.CenterPointEnergy.com/NGIA.

About CenterPoint Energy, Inc.

As the only investor owned electric and gas utility based in Texas, CenterPoint Energy, Inc. (NYSE: CNP) is an energy delivery company with electric transmission and distribution, power generation and natural gas distribution operations that serve more than 7 million metered customers in Indiana, Louisiana, Minnesota, Mississippi, Ohio and Texas. As of March 31, 2023, the company owned approximately $38 billion in assets. With approximately 9,000 employees, CenterPoint Energy and its predecessor companies have been in business for more than 150 years. For more information, visit CenterPointEnergy.com.

SOURCE CenterPoint Energy, Inc.