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Minnesota’s Evolution: The Shift Toward an Inclusive Community Solar Program

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Minnesota’s Evolution: The Shift Toward an Inclusive Community Solar Program

December 21, 2023

Minnesota was among the first states to widely adopt community solar. The original CSG program, created in 2013, is sunsetting at the end of 2023 after approving the development of more than 1 GW in Xcel’s service territory. In 2024, a new program will take effect: the Low and Moderate-income Accessible Community Solar Garden program.

Table of Contents

Minnesota’s Legislative Fix for Community Solar 

Enacted on March 1, 2023, House File 2310 established a new framework to modernize the legacy program by raising the project size limit from 1 MW to 5 MW, removing the contiguous county geographic restriction on subscribers, introducing both 30% LMI and 50% residential minimums per project, and tapping the MN Department of Commerce to replace Xcel as program administrator. 

The Beginning of an Inclusive CSG Program

Commerce hired its program lead in November and is working with stakeholders to iron out the remaining details, including what exactly the capacity award process will look like and how legacy projects may be able to transition into the new program. For now, HF 2310 includes much of what the community solar industry needs to know, including setting the following annual caps: 

Key Provisions of the New Program

2024 – 2026 100 MW per year
2027 through 2030 80 MW per year
2031 → 60 MW per year

Xcel will continue to keep the RECs without an additional payment but will also be required to implement consolidated billing by January 2025 and provide an update on progress toward that goal in mid-2024. Project application requirements include a signed interconnection agreement, non-ministerial permits, and a copy of the subscriber agreement. Finally, on top of the 30% LMI minimum, an additional 25% of every project’s subscribers must also qualify as LMI, affordable housing, or public interest (nonprofits, schools, social service providers, houses of worship, or tribal entities). To support subscriber organizations in reaching these targets, the bill credit rate is shifting from a Value of Solar methodology to adopt the retail rate structure shown below. 

Bill Credit Rates Move Away from Value of Solar

LMI subscribers 100% of average residential retail rate
Non-LMI residential subscribers 85% of the average residential retail rate
Master-metered affordable housing 80% of the average retail rate
Public interest subscribers (small general commercial customer) 75% of the average retail rate
Public interest subscribers (general service commercial customer) 100% of the average retail rate
Other commercial subscribers 70% of the average retail rate

Solstice in Minnesota

Solstice already manages subscribers in Minnesota and is thrilled to see the state’s community solar market take this crucial step to keep up with leading markets around the country. We’re excited to see the Commerce Department wrap up its rulemaking process early in 2024 so the industry can get this next wave of inclusive community solar projects underway as soon as possible. 

Community Solar Success Starts with Solstice

At Solstice, we redefine excellence in community solar solutions, specializing in customer acquisition and management and ensuring the clean energy benefits reach the communities we serve. Our approach involves fostering enthusiasm and local buy-in for your projects, driving workforce development within resident populations, and establishing strategic partnerships with crucial businesses and organizations. Our commitment to to customer excellence extends to providing bilingual education, ensuring that all customers receive comprehensive support and guidance in their preferred language.

Not only do we guarantee an unparalleled customer experience. Our comprehensive services for YOU encompass expert policy and program guidance, alongside a dedicated team of asset managers ready to support you every step of the way from permitting to decommissioning. We know that switching CMA providers may seem like a hassle, but we’re ready to show you why we’re worth the job. Take the leap today—partner with Solstice and unlock the full potential of your community solar projects.

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