Energy Tips: Minnesota Solar Incentive

By KBJR News 1

Energy Tips: Minnesota Solar Incentive

February 3, 2014 Updated Feb 3, 2014 at 12:32 PM CST

New incentive program gives solar a big boost in Minnesota
Minnesota Department of Commerce

The cost to install a solar energy system will be much more affordable for those who qualify for the new 10-year, $15-million-a-year, Made in Minnesota Solar Incentive Program. The program, which was launched on January 1st by the Minnesota Department of Commerce, will boost Minnesota’s solar energy generation.

Customers of investor-owned utilities (Xcel Energy, Alliant Energy, Minnesota Power, and Otter Tail Power) who install solar modules or collectors certified as manufactured in Minnesota are eligible for the program. Applications for Solar Electric Production Incentives and Solar Thermal Rebates will be accepted each year for 10 years from January 1st to February 28th.

Solar Electric Production Incentives
The solar electric incentives are performance-based—established by a system’s energy production—and paid over 10 years. Owners of an approved and installed solar electric system will receive payments annually by July 1st based on the kWh output of the system in the previous calendar year. Incentives are available for commercial, nonprofit/government, and residential solar electric systems. Residential systems may have a capacity of up to 10 kW.

For example, a resident who installs a 5 kW system that generates 6,446 kWh of electricity annually may be paid up to $2,514 (6,446 x $.39/kWh) each year for 10 years, or a total of about $25,000 (if annual production remains the same).

Solar Thermal Rebates
Up to $250,000 per year in rebates is reserved for customers who install “Made in Minnesota” solar thermal systems. The solar thermal system may be installed in residential or commercial facilities for hot water or space heating purposes. Rebates are available to commercial, multifamily, and residential property owners. The rebate is equal to 25 percent of the system installed cost up to a maximum of $2,500 for residential, $5,000 for multifamily, and $25,000 for commercial systems.

The new incentives combined with the 30 percent federal Residential Renewable Energy Tax Credit and a state sales tax exemption on solar equipment will likely pay for more than half of the cost of a residential solar system. A comprehensive list of incentives and policies that promote renewable energy and energy efficiency is available.

You can learn more about the Made in Minnesota program by clicking here.