The Shift To Solar

Minnesotans have new incentives to invest in renewable energy as a result of this year’s legislative session. An omnibus energy bill passed last month sets the stage for an expansion of solar energy for the state. It is modeled after the state’s earlier energy policies that led it to become a leader in wind energy, currently 14 percent of total power generation.

The new solar energy standard is the most exciting component of legislation. It requires four of the five investor-owned utility companies to provide 1.5 percent of their power supply from solar by 2020. 1.5 percent doesn’t sound like much, especially because the lobbying environmental organizations had the goal of 10 percent, but it is still something to celebrate. 1.5 percent means a shift from just 13 megawatts today to about 450 megawatts of solar power in the next 7 years. That’s about a 30 fold increase according to Midwest Energy News. What’s more, is that 10 percent of the new solar generation must come from systems that are 20 kW or less, signaling a priority to keep individuals a part of this energy transformation.

For the home- or business-owner this new legislation means more solar rebates and financial incentives from the state and energy companies. Just how they will work or what exactly they will be are still up in the air. Details of such programs will be decided upon in the coming months.What we know for sure is that a Solar Incentive Program for systems less than 20 kW will run from 2014-2018 and will be funded at $5 million per year by the Renewable Development Fund (for Xcel territory only), and the Made in Minnesota (MiM) solar modules incentive will continue, with $15 million per year provided from 2014-2023, including $250,000 per year for solar thermal systems.

The unfortunate reality is that only about 1/3 of all buildings meet the requirements to be able to hold solar panels, leaving some people who would otherwise invest in this new technology unable to get in the game. With this group in mind, a provision of the legislation allows for the development of community shared solar, or “solar gardens.” A group of individuals can invest in a shared system not more than 1 MW, as an alternative to installing solar panels on their property.

Other highlights of the legislation include: new energy studies on on-site energy storage, the value of solar thermal, and other miscellaneous energy topics to be completed by the Department of Commerce; Guaranteed Energy Savings Program contracts extended from 15 to 25 years on state buildings; and Property Assessed Clean Energy (PACE) financing terms extended from 10 to 20 years.