New utility incentive can help low-income customers go solar

Published 8:34 am Friday, February 22, 2019

Upfront expenses have made it hard for low-income homeowners to afford solar power systems that generate both clean energy and long-term electricity cost savings.

But that barrier is now being lowered for low-income customers of Xcel Energy.

Xcel’s new Solar*Rewards Income-Qualified Customers Program is offering about $1 million in incentives for low-income Minnesotans who install solar energy systems.

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Single families that qualify can receive an upfront payment of $2 per watt and annual production incentives of seven cents per kWh (kilowatt hour) over the first 10 years of the system.

On a 4-kW system with an estimated total cost of $16,000, the customer would receive an $8,000 upfront payment. With the annual production incentives and some tax incentives, the system could pay for itself in several years.

Single-family applicants must be qualified as a participants in the Low-Income Home Energy Assistance Program (LIHEAP) or Weatherization Assistance Program (WAP). For example, a family of four qualifies for LIHEAP with an annual income of less than $49,698.

Nonprofit and multifamily housing providers that serve low-income Xcel customers can also receive a $1 per watt upfront payment for newly-installed solar systems and six cents per kWh in production incentives for the first 10 years.

In addition, new community solar gardens that serve low-income customers  are eligible for a 50 cents per watt upfront payment and six cents per kWh production incentive.

More details on eligibility criteria and incentives are available on Xcel’s Solar*Rewards Income-Qualified Customers Program webpage.

In 2017, the Minnesota Legislature extended Xcel’s overall Solar*Rewards Program by three years with $10 million allocated for 2019, $10 million for 2020 and $5 million for 2021. The program provides 10 years of annual incentive payments to customers who install solar power systems of 40 kW or less. The incentive payment is based on the system’s annual energy production.

General residential qualifiers of Solar*Rewards receive an annual production incentive of seven cents per kWh for the first 10 years of the system. General commercial qualifiers receive six cents per kWh for 10 years. Incentives are awarded on a first-come, first-served basis.

Check with local utilities

If you are not an Xcel customer, check with your own local utility to see if it offers incentives for new solar energy systems. Other incentives available to Minnesotans for solar and other clean energy improvements can be found on the Database of State Incentives for Renewables & Efficiency at