Minnesota ranks 13th in the nation for installed solar capacity, according to the Solar Energy Industries Association (SEIA) and is on track to increase its solar capacity by more than 800 MWs in the next five years. SEIA notes that in 2019, the state invested $1,914 million in solar, a huge increase over the $31 million spent in 2015. With solar-friendly policies and incentives, a growing number of homeowners are switching to solar. Find out how to make the change, and learn where to start.
Minnesota’s Solar
Report Card
To determine a grade for each state, our researchers and solar experts analyzed data on crucial solar-advancement criteria from the following sources:
- Rebates, Tax Credits, and Tax Exemptions from Database of State Incentives for Renewables & Efficiency;
- Electricity Rates from the U.S. Energy Information Administration;
- Renewable Energy Policy from NC Clean Energy Technology Center;
- Interconnection Ease from Freeing The Grid;
- Photovoltaic Potential from the Energy Department
We determined a rank from one to 10 for each state in each category. We then combined the scores with the following weights and assigned an overall grade for each state. Our goal is to encourage those considering solar for their homes to get a basic understanding of solar potential in their areas and discover the best opportunities for clean energy available.
Incentives & Rebates, 40%
Electricity Rate, 15%
Renewable Energy Policy, 30%
Interconnection Ease, 5%
Photovoltaic Potential, 10%
Electricity Costs in Minnesota
Electricity rates higher than the national average, falling in at $0.14 per kWh, according to the U.S. Energy Information Administration (EIA). The state ranks 15th for highest price. About 60 percent of Minnesota’s electricity is generated by coal-fired and nuclear power plants, according to the EIA. Generally, states with more expensive utility rates tend to see higher solar energy adoption since it translates into a higher return on investment. Not surprisingly, just as the state’s electricity rate hovers near the middle, so does its solar installation numbers. SEIA notes that Minnesota’s 33 MW of solar places the state 28th in the country for installed solar.
Cost of Residential Electricity
Data from U.S. Energy Information Administration
*as of Q3 2015
Additional Reading
on Solar in Minnesota
Solar Policies, Tax Incentives & Rebates
According to the state’s mandatory Renewable Energy Portfolio Standard (RPS), public utilities are required to have at least 25 percent of electricity generated by renewable sources, with 1.5 percent from solar by 2025. The requirement is even higher at 31.5 percent by 2020 for Minnesota’s nuclear utility, Excel Energy. Utility, county, state, and federal incentives are encouraging the use of solar energy throughout the state. Boosting solar energy production is Excel Energy’s incentives, and Minnesota Power’s rebate program to name a few. Between rebates, tax exemptions and credits, grants, loan assistance, and other programs, residents can save by installing solar panels.
REBATES/INCENTIVES
Offers incentives for solar energy produced by systems possessing a capacity of up to 20 kW. The incentive amount offered is $.08/kWh over 10 years, paid annually.
Made In Minnesota Solar PV Incentive ProgramProvides a 10-year incentive contract. Rates are determined annually by the Commissioner of Commerce. Systems must be certified as “Made in Minnesota”, and less than 40 kW in capacity to qualify.
MinnPACE ProgramProvides PACE funding for energy efficiency and renewable energy projects for businesses, housing, and other buildings. The maximum amount offered is equal to 20 percent of real property value.
Rochester Public Utilities – Solar Rebate ProgramProvides an incentive for commercial and residential customers of Rochester Public Utilities of $0.50 per watt for the installation of solar panels.
Austin Utilities – Solar Rebate Program Owatanna Public Utilities – Solar Rebate Program Brainerd Public Utilities – Renewable Incentives Program Moorhead Public Service Utility – Renewable Energy Incentive New Ulm Public Utilities – Solar Electric Rebate Program Steele-Waseca Cooperative Electric – The Sunna ProjectNone for residential specifically
Offers loans for up to 20 percent of assessed property value, up to $100,000, with a minimum loan of $5,000. Qualifying clients are businesses in the counties part of the Rural Minnesota Energy Board.
Value-Added Stock Loan Participation ProgramOffers the ability for farmers to finance the purchase of various companies or partnership (which includes renewable energy cooperatives).
Minnesota Power – SolarSense Solar Rebate ProgramOffers a rebate of $750/kW for grid-connected solar panel electric systems, up to a maximum total award of $20,000 or 60 percent of installation costs (whichever is less).
Minnesota Power – Power Grant ProgramOffers grants up to $50,000 for commercial, industrial and agricultural customers who are pursuing projects that use renewable energy, lower energy costs, and other applications. Grant maximums depend on individual kW capacity.
Commercial and Industrial Energy Efficiency Rebate by Shakopee Public UtilitiesProgram that provides rebates to increase energy efficiency for commercial facilities, with the incentive maximum being capped at 50 percent of the total project cost.
POLICIES
Enacted in 1983, net metering requirements apply to all utility companies, and must be offered for customers possessing less than 1,000 kW capacity at investor-owned utilities and less than 40kW capacity at electrical cooperatives.
Solar and Wind Easements & Local Option Rights LawsLegislation offers voluntary solar and wind easement contracts. In Minnesota, easements imposed on properties may reduce property values for tax purposes, but cannot increase value. Laws also prevent zoning laws from restricting sunlight access.
Comprehensive Energy Savings Plan for State FacilitiesEnergy efficiency policies set goals that require 20 percent energy reduction by state facilities (no deadline), and a goal of having 90 percent of new state buildings built to be certified green by 2025.
Renewable Development Fund (RDF)Requires Xcel to contribute $16 million annually towards the development of renewable energy sources for each year that the Prairie Island nuclear power plant is in operation and $7.5 million for each year not in operation.
Interconnection StandardsState legislation has required the adoption of standards for utility tariffs for interconnection, applied to connecting distributed generation plants with a capacity of up to 10 MW. The standards also created a conflict-resolution process, standard application fees, and other requirements.
Renewable Energy Standard Community-Based Energy Development (C-BED) Tariff Value of Solar TariffsNone for residential specifically
None for commercial specifically
TAX CREDITS
None for residential/commercial specifically
None for residential specifically
None for commercial specifically
EXEMPTIONS
Provides a 100 percent exemption from real property taxes for solar electric systems used in commercial, residential and industrial properties.
Solar Energy Sales Tax ExemptionSolar energy systems purchased on or after August 1, 2005, are fully exempt (100 percent) from the state’s sales tax. This exemption applies to all solar energy systems, including solar panels.
None for residential specifically
None for commercial specifically
Contractors & Installers of Solar Panels in Minnesota
All Energy Solar works to bring affordable solar options and accurate ROI forecasting to its Minnesota customers. As a full-service solar contractor, AES helps homeowners with every step of the process, from analysis and design to installation, monitoring, and beyond.
Where it operatesSt Paul, MN
Year of opening2009
Cedar Creek Energy specializes in solar energy and energy management for Minnesota residents, businesses, nonprofits, and agricultural locations.
Where it operatesCoon Rapids, MN
Year of opening2007
Blue Horizon Energy provides Minnesota with solar energy solutions and energy efficient upgrades. Customers can go online and monitor their system’s performance and track their return on investment.
Where it operatesMinneapolis, MN
Year of opening2010
With their team of fully certified installers and sales staff, Powerfully Green works to bring solar installations to Minnesota residents that maximize solar output and save money quicker.
Where it operatesChamplin, MN
Year of opening2007
Innovative Power Systems’ was named Top Solar Contractor three years in a row by Solar Power World. They’ve installed over 1,000 solar projects in Minnesota.
Where it operatesSt Paul, MN
Year of opening1991
AEI offers commercial and residential services from solar PV systems to solar thermal with certified NABCEP technicians and installers.
Where it operatesMinneapolis, MN
Year of opening2010
Serving all of Minnesota, North Dakota, South Dakota, and Wisconsin works to provide Minnesota residents with clean energy that has both long- and short-term financial and environmental benefits.
Where it operatesSebeka, MN
Year of opening2008
Conservation Technologies brings Minnesotans solar solutions using their background in building construction, building performance, and energy issues. This company offers solar and wind systems.
Where it operatesDuluth, MN
Year of opening1994
Juhl Energy runs its headquarters on completely off-grid solar and wind energy. They custom design each solar solution to meet the needs of individual customers.
Where it operatesPipestone, MN
Year of opening1979
Solar Connection brings affordable custom solar panel installations to homes, farms, and commercial businesses in southern Minnesota. They provide a free solar assessment for potential customers considering solar.
Where it operatesRochester, MN
Year of opening2010
Aquilla Solar develops, finances, and installs solar for homes, businesses, and other institutions throughout southeast Minnesota. They offer different financing options – zero down, lease to own, outright purchase, or other lending options.
Where it operatesWabasha, MN
Year of opening2015
Offers turn-key solar electric solutions for residential, commercial, non-profit and government customers. Services include site surveys, quotes, design, procurement, installation and more. Winona’s goal is to, “make renewable energy available and affordable to everyone while providing outstanding professional service, superior attention to detail, solid integrity, proactive safety, quality products, and competitive value.”
Where it operatesWinona, MN
Year of opening2009
Minnesota Solar Panel Resources
Learn more about the governing body that regulates electricity and other public utilities in Minnesota.
Discover Minnesota’s energy programs, policies, and projects, and explore energy-related statistics.
Track solar-related legislations and issues regarding energy in Minnesota.
Find information on policies, incentives, tax benefits, and other initiatives promoting solar energy in Minnesota and across the country.
Explore data regarding Minnesota’s electricity production, consumption, and prices from the U.S. government.