USDA Programs/Utility Program
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Most utilities provide some type of program to compensate for installing a solar system. The most common, with some being utility specific:
Xcel Energy offers a Solar Rewards solar production incentive up to 60kw DC/ 40 AC kW in size for residential and non-profits starting in 2023. Solar Rewards for commercial projects are being discontinued starting in 2023.
Utilities, whether a cooperative, municipal, or Investor Owned Utility (Xcel, Mn Power, Otter Tail), will pay you their retail energy rate for any production that is not used internally for projects up to 40kw AC.
Under net metering, at the end of a monthly billing period the earned income is generally credited to the next month’s bill. Projects that greatly exceed the customer's energy usage may take the form of an actual payment typically at year end.
Demand Credit Rider:
The Xcel Demand Credit Rider is a Standby Credit to qualified customers for installing solar to offset the utility demand side management. Projects are sized 40 kw AC on up to 1 MW. Xcel is required to compensate to offset their need for standby generation.
Credit is issued to owners of solar systems at a rate of .06887/kWh for solar system production between the hours
of 1 PM-7 PM, 7 days a week, up to 100 hours per month during summer, 75 hours during other months.
The electric utilities must maintain sufficient generating capacity and transmission capacity to supply a customer’s peak demand at any given time. The utility does not know for sure when the peak demand might come, but it has to be ready. Most of the time the utility’s generating and transmission capacity sits by idly waiting to spring into action whenever customers demand it. It is expensive to maintain that excess generation and transmission capacity. Utilities charge customers for the costs of having power ready on demand. MN PUC decided that Xcel should compensate larger users for not having to wheel power to the customer. They decided that large users that install solar systems shall be compensated the same as Backup/Stand-by generation.
Community Solar Gardens:
A utility that offers a community solar garden (CSG) program must compensate systems at the rate approved with the utility. Current law caps the project size to 1 MW AC.
Energy Storage added to a solar system can be used to not only reduce demand usage, but also supply backup for critical operational items. Storage has now become cost effective. EPF Solar is involved at various levels to make sure we design and size your project correctly.
Energy storage qualifies for a 30%-40% Investment Tax Credit (ITC).
Additional programs that may be available depending upon project location.