A New Minnesota Law is Set to Aggressively Propel Solar Growth

Minnesota Solar BillA game-changing new energy bill which was signed into law by Minnesota Governor Mark Dayton in May of this year has gained a great deal of attention. If requirements outlined in the bill are met, solar generation in the state will increase more than thirty-fold by 2020. The new solar electricity standard for large utilities in Minnesota is the news creating the biggest stir; the requirement will be 1.5% of energy production by 2020, which is on top of the 25% renewables by 2025 mandate for large utility companies.

Other parts of the new law arguably carry as much impact as the new solar requirements, such as net-metering reforms, expanded incentives, and the creation of shared community solar gardens.

Minnesota’s utilities currently generate about 13 megawatts of solar power. For the new solar requirement to be met, an estimated 450 megawatts of solar power must be added to investor-owned utility systems. This endeavor seems staggering in scope. Fortunately, the bill also provides direction for how to achieve these lofty goals.

Extension of Solar Rebates

Part of the law mandates that at least one-tenth of new solar generation must come from small solar systems which produce up to 20 kilowatts. To ensure financing of these needed installations, the law extended a rebate program which Xcel Energy was phasing out by the end of this year. The utility company, however, has been ordered by the Minnesota Department of Commerce to continue the rebate program through 2015. It’s also mandated that a similar incentive will remain in place until 2018.

Reward-based Solar Incentives

There is a change regarding rebates, and it’s designed to ensure that solar systems are as productive as possible. Rather than receiving rebates upfront, rebate amounts will be based on the amount of solar electricity produced.

Community Solar Gardens

Experts have estimated that only about one-third of the homeowners in Solar GardenMinnesota have rooftops suitable for installing solar photovoltaic (PV) systems. Some of the issues which create the problems include rooftops that aren’t strong enough or sunny enough or don’t have the right kind of angle. An exciting new program requires utility companies to create community solar gardens. Customers will be able to buy individual solar panels which are set up as part of community solar installations. The electricity generated by each solar panel is credited to the owner, as though it were on their own rooftops.

Community solar programs aren’t a new idea; New Mexico and Colorado have already been utilizing solar gardens.

Increased Net Metering Cap

The net metering cap in Minnesota was lifted in the new law, which makes it easier for customers of investor-owned utilities to connect larger solar installations to the grid. The previous 40-kilowatt capacity has been increased to 1,000 kilowatts. Net metering is basically a policy which standardizes utility hook-ups and payments for all customer-owned generation which fits the criteria. Companies have been deterred from building larger solar systems because of the artificial cap on commercial development of solar, but the new law is expected to change that.

Not everyone is a fan of the new legislation. For instance, utility companies have expressed concern that these new mandates demand too much too quickly. Others are looking forward to the positive impact an explosive increase in solar installations can have on the state’s economy.

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