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Solar Incentives and Rebates in minnesota

Peak Sun Hours (PSH): 4.3 - 4.5
Cost of Grid Power: $0.13/kWh
Number Of Installations: 7,482

Data from DSIRE. For more info visit: https://www.dsireusa.org/

Name Implementing Sector Program Type Administrator DSIRE ID
Wind and Solar-Electric (PV) Systems Exemption State Property Tax Incentive 151
Net Metering State Net Metering 282
Solar and Wind Easements & Local Option Rights Laws State Solar/Wind Access Policy 302
Energy Investment Loan Program State Loan Program Minnesota Department of Commerce 326
Comprehensive Energy Savings Plan for State Facilities State Energy Standards for Public Buildings 357
Xcel Energy Wind and Biomass Generation Mandate State Renewables Portfolio Standard 396
Mandatory Utility Green Power Option State Mandatory Utility Green Power Option 410
Solar Equipment Certification Requirement State Equipment Certification 477
Wind Energy Sales Tax Exemption State Sales Tax Incentive 601
Non-Mandated Renewable Energy Objective State Renewables Portfolio Standard 605
Solar Energy Sales Tax Exemption State Sales Tax Incentive Department of Revenue 1218
Great River Energy (28 Member Cooperatives) - Solar-Electric (PV) Rebate Program Utility Rebate Program Great River Energy 1243
Rental Rehabilitation Loan Program State Loan Program Center for Energy and Environment 2322
Renewable Energy Standard State Renewables Portfolio Standard 2401
Minnesota - Design Requirements for State Funded Buildings State Energy Standards for Public Buildings 2627
Made in Minnesota Solar PV Incentive Program State Performance-Based Incentive Minnesota Department of Commerce 5418
Made in Minnesota Solar Thermal Rebate State Rebate Program Minnesota Department of Commerce 5419
Value of Solar Tariff State Performance-Based Incentive Minnesota Department of Commerce 5420
Value of Solar Tariff State Net Metering 5446
Value of Solar Tariff State Value of Solar Tariff 5666
Steele-Waseca Cooperative Electric - The Sunna Project Utility Grant Program 5673
Xcel Energy - Solar*Rewards Community Garden Utility Solar Renewable Energy Credit Program 5677
Rural Minnesota Energy Board PACE Program Non-Profit PACE Financing 5749
Rural Minnesota Energy Board PACE Program Local PACE Financing 5751
Made in Minnesota Solar PV Incentive Program Utility Performance-Based Incentive Minnesota Department of Commerce 5909
City of Minneapolis - Solar Energy System Local Solar/Wind Access Policy Minneapolis Department of Sustainability 5921
City of Minneapolis - Wind Energy Conversion Systems Local Solar/Wind Access Policy 5922
Connexus Energy - Compressed Air Efficiency Evaluation Utility Energy Analysis Connexus Energy 15295
Minnesota Energy Resources - Energy-Saving Audits Utility Energy Analysis 15361
Owatonna Public Utilities - Energy Audit Utility Energy Analysis Owatonna Public Utilities 15393
Xcel Energy - Compressed Air Efficiency Utility Energy Analysis Xcel Energy 16359
Xcel Energy - Energy Analysis Utility Energy Analysis 16361
Minnesota Power - Commercial Energy Analysis Utility Energy Analysis 16365
Dakota Electric Association - Business Energy Audits and Assessments Utility Energy Analysis 16759
Center for Energy and Environment - Energy Intelligence for Industry Non-Profit Energy Analysis Center for Energy and Environment 16862
Otter Tail Power Company - Rate Analysis and Research Assistance Utility Energy Analysis Otter Tail Power Company 16916
Otter Tail Power Company - PowerProfiler Utility Energy Analysis Otter Tail Power Company 16917
Arrowhead Electric Cooperative - Energy Efficient Equipment Program Other Energy Analysis 17173
East Central Energy - Business Energy Evaluation Utility Energy Analysis 17175
Minnesota Technical Assistance Program Other Energy Analysis 17554
University of Minnesota - Minnesota Technical Assistance Program Other Energy Analysis University of Minnesota 17555
Austin Utilities - Business Energy Audit Other Energy Analysis 17883
We Save Business - Demand Side Management Other Energy Analysis The City of East Grand Forks 18499
Rochester Public Utilities - Compressed Air System Leak Check Utility Energy Analysis Rochester Public Utilities 18918
Rochester Public Utilities - Energy Audit Utility Energy Analysis Rochester Public Utilities 18920
Alexandria Light and Power - Questline Internet Resource Service Utility Training and Information 19825
Austin Utilities - Compressed Air Leak Correction Other Energy Analysis 19831
Blue Earth Light and Water - Compressed Air Study Program Utility Energy Analysis 19840
Tyler Municipal Light & Power Dept - Energy Smart Rebates Other Energy Analysis Tyler Municipal Light & Power Dept 19972
Steele-Waseca Cooperative Electric - Wellspring Wind Energy Program Utility Other Steele-Waseca Cooperative Electric 20024
New Ulm Public Utilities - Rebate/Reimbursement Programs Utility Energy Analysis New Ulm Public Utilities 20424
Minnesota Valley Cooperative - Minnesota Valley Electric Cooperative - Energy Audits Other Energy Analysis 20675
Grand Rapids Public Utility Commission - Conservation Improvement Program Other Energy Analysis Grand Rapids Public Utility Commission 20796
Owatonna Public Utilities - Compressed Air Leak Correction Utility Energy Analysis Owatonna Public Utilities 20890
Owatonna Public Utilities - Load Profiler Utility Energy Analysis Owatonna Public Utilities 20891
Owatonna Public Utilities - Partnering in Energy Solutions Utility Energy Analysis Owatonna Public Utilities 20892
Xcel Energy - Energy Design Assistance Utility Energy Analysis Xcel Energy 21546
Xcel Energy - Online Energy Assessment Utility Energy Analysis Xcel Energy 21547
Xcel Energy - Refrigeration Recycling Utility Energy Analysis 21572
Xcel Energy - Small Business Lighting Utility Energy Analysis 21583
Xcel Energy - Business Energy Advisor Utility Energy Analysis Xcel Energy 21584
Missouri River Energy Services - Bright Energy Solutions Other Energy Analysis Missouri River Energy Services 21612
Xcel Energy - Business Solutions Utility Energy Analysis 21623
Xcel Energy - Energy At Risk Financial Analysis Tool Utility Energy Analysis 21637
Xcel Energy - Energy Management Systems Utility Energy Analysis 21648
Seventhwave (formerly Energy Center of Wisconsin) - Energy Consulting Non-Profit Energy Analysis Seventhwave (formerly Energy Center of Wisconsin) 21796
Seventhwave (formerly Energy Center of Wisconsin) - Back of the Envelope Calculator Non-Profit Energy Analysis Seventhwave (formerly Energy Center of Wisconsin) 21797
Seventhwave (formerly Energy Center of Wisconsin) - Comprehensive Education Programs and Services Non-Profit Training and Information Seventhwave (formerly Energy Center of Wisconsin) 21798
Midwest Energy Efficiency Alliance - Midwest Industrial Initiative Non-Profit Energy Analysis Midwest Energy Efficiency Alliance 21822
Midwest Energy Efficiency Alliance - Building Operator Certification Non-Profit Training and Information Midwest Energy Efficiency Alliance (MEEA) 21824
Center for Energy and Environment - Engineering for Energy Efficiency State Energy Analysis Center for Energy and Environment 22032
Central Minnesota Municipal Power Agency - State Energy Analysis 22033
Willmar Municipal Utilities - Commercial Energy Efficiency Rebate Program Utility Rebate Program Willmar Municipal Utilities 22087
Connexus Energy - Residential Energy Efficiency Loan Program Utility Loan Program Center for Energy and Environment 22088
Minnesota Energy Resources (Gas) - New Construction Rebates Utility Rebate Program Minnesota Energy Resources 22091


What’s the Cost of Solar in Minnesota?

Cost of Grid Power

Minnesota electricity prices average $0.13/kWh, just below the national average of $0.14/kWh. In 2018 Minnesota's solar energy capacity increased by three percent to nearly three percent of the state's net generation.

Cost of a Solar Install

Cost of a typical 7.5kW PV install in Minnesota from 2009-2018

A graph of falling prices for a typical 7.5kW PV install in Minnesota from 2009-2018.
Figures include design costs. Data from Berkeley Lab.

The average cost of a 7.5kW (equivalent to saving about 200 trees a year) solar power system starts around $23,000 in Minnesota. Before any incentives, in the first year you’d save about $1,300, compared to if you had been paying the normal rates for the energy you used. These savings can continue for well over 25 years, improving with inflation.




Just How Much Can I Save With Solar in Minnesota?

This depends on may factors such as your system size, power output, and financing. Here are the main ways you can finance your home solar power system, and the kinds of returns you may expect to see:

Out-of-Pocket

From our example above, the homeowner purchased a 7.5kW system to offset their energy bill. Overhead cost was $23,000, with a significant proportion returned in the first year through incentives, rebates, and savings, then paying itself in full over 8 years.

Most solar power systems have a warranty lifetime of 25 years. In that time, between incentives and paying lower rates you could make a profit of around $30,000 - more than the up-front cost of the system!

Even with occasional maintenance or part replacement, that is a massive savings. Solar panel power output falls on average 0.8% per year, so with a little TLC and load management you can extend the life of your system well beyond the warranty’s expiration date, continuing to save indefinitely.

Solar Loan

Whether or not you can afford the up-front cost of the install, you may want to consider a Home Equity Line of Credit (HELOC). With equity in your home, or good credit, you may qualify for a 15-year solar HELOC with fixed rate of 4% or lower.

Starting with that same 7.5kW system costing $23,000 but with zero up-front cost, accounting for incentives, credits, rebates, and annual energy savings starting around $1,300, you could see a revenue surplus of about $6,000 at the end of the first year.

Save some of that money though. Your loan payments will likely exceed your power savings during the 15-year term. Once the loan is paid off, you can expect to save about $1,700 a year. Over 25 years you could expect to make about $21,000.

Power Purchase Agreement

With a Power-Purchase Agreement (PPA) the homeowner leases their roof to an outside party, usually a power company. Generally PPAs feature a fixed price per kWh, with either a fixed term or an annual escalator.

With a PPA, the cost of installation, repair, and maintenance to the homeowner is usually $0.00. For that 7.5kW system, with a PPA you could expect to save about $200/year on energy, with that figure increasing as electricity rates rise over time. Over 25 years, you could see over $9,000 in revenue. That’s technically an infinite return!

PPA’s can be complicated, as you are effectively ceding at least some control of your home to the third party, but they are an excellent way to get into solar because they have no overhead.




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