Supporters of a law Minnesota passed in 2007 say it encourages utility companies to switch to cleaner energy instead of burning coal.
But for the second time a court has said a key part of that law is unconstitutional.
The law called the Next Generation Energy Act bans importing power to Minnesota from any big new plant that adds to carbon dioxide emissions.
So under that law, energy from coal-fired plants that went up in North Dakota since '07 can't be sold to Minnesotans.
North Dakota and three electric co-ops with Minnesota customers filed a federal lawsuit in 2011. They argued that Minnesota is basically trying to regulate utilities in other states. The court agreed with them, saying the Constitution makes it clear that only Congress can make rules about interstate commerce.
Minnesota appealed. On Wednesday the law was shot down again, this time by three judges on the 8th Circuit Court of Appeals.
North Dakota Attorney General Wayne Stenehjem applauded the appeals court ruling, saying in a statement: "North Dakota has once again prevailed in its lawsuit against Minnesota’s overreaching regulations.”
Stenehjem noted that Minnesota is also on the hook to cover North Dakota's court costs, which he says are up to about $1 million.
Gov. Mark Dayton says he strongly disagrees with the court's decision to strike down "an essential part" of Minnesota's clean energy law.
Will the case go to the U.S. Supreme Court? Dayton says: “I will need to review this ruling with the Attorney General before further consideration of how to proceed."