FOR IMMEDIATE RELEASE
May 17, 2023
Minnesota Lawmakers Announce Long-Awaited Community Solar Garden Updates
St. Paul, MN—The Minnesota solar + energy storage industry applauds state lawmakers for reaching a long-awaited deal on Community Solar Garden (CSG) updates. After rigorous weeks of negotiations, the Environment, Natural Resources, Climate, and Energy Finance and Policy Conference Committee passed a conference committee report which sunsets the existing, “Legacy CSG” program and includes the following updated terms for the Community Solar Garden program going forward:
- Contiguous county restriction removed for new projects. This arbitrary rule said CSG subscribers had to live in the same county as the solar garden or a county contiguous (next to.)
- Individual garden size cap increased from 1 megawatt (MW) to 5 MWs.
- New cap on the subscriber-based CSG program with:
- 100 MW cap each year in the years 2024-2026;
- 80 MW cap each year in the years 2027- 2030; and
- 60 MW cap each year after 2030.
- New rate structure defined: CSGs will now use a net-metering rate instead of the Value of Solar rate. This will be discounted based on customer “class” to encourage low-to-moderate income subscribers.
- New subscriber requirements: 25 subscribers per MW of solar, 55% of subscribers are public interest, and 30% must be LMI.
Finally, the bill establishes a new Distributed Generation (DG) Standard that requires all utilities to meet a new percentage of solar development through non-subscriber, competitively bid DG solar. The new DG program will include:
- 3% of Xcel Energy retail sales to be from DG solar by 2030 (approximately 700 MW);
- 3% of Minnesota Power sales to be from DG solar by 2030 (excluding industrial customers);
- 1% of Otter Tail Power sales to be from DG solar by 2030; and
- Grid-connected projects up to 10 MW.
To accomplish the new DG standard the agreement will:
- Require Xcel to include DG solar in its Integrated Distribution Plan (IDP) and make all needed upgrades to the grid to accommodate the new DG Standard; and
- Evaluate cost saving measures including: smart inverter usage, flexible interconnection agreements, grid management tools, DER management tools, and export tariffs.
Minnesota’s CSG program was created by state legislation in 2013. It was the largest program in the country for many years until New York took the lead in 2022. Minnesota’s program has served as a roadmap for other states creating similar legislation and has resulted in over 860 megawatts of solar across Minnesota.
For the last five years, lawmakers, Xcel Energy, Coalition for Community Solar Access (CCSA), MnSEIA and our members, and other stakeholders have actively worked towards a compromise for necessary updates to the existing program. Community solar garden development drastically stalled in the last few years as developers ran into interconnection issues and obstacles with the contiguous county requirement, which said CSG subscribers had to live in the same county as the garden or a county contiguous (next to) the garden. Many companies had to leave the state altogether as opportunities ran out, taking jobs with them.
“As someone who has worked with community solar garden programs across the country over the last decade, Minnesota really stands out,” says Kevin Cray, Senior Regional Director at Coalition for Community Solar Access (CCSA.) “Minnesota has been a pioneer in community solar for years, but outdated rules were holding the state’s vast potential back. This legislation will allow the North Star State to be realigned with other nation-leading markets and really center the “community” in community solar. It’s incredibly rewarding to see these updates pass, and I know a lot of our member companies will be looking to do business in the Minnesota market again.”
Reaching a fair resolution to CSG program updates has not been easy. It required constant communication between interested stakeholders such as utilities, advocacy groups, solar installers and developers, legislators, state agencies, and more to ensure policy was realistic and mutually beneficial.
Ensuring that diverse and low-to-moderate income communities, who have historically been left out of the clean energy transition, could also participate in community solar was a key focus in negotiations. MnSEIA met frequently with Cooperative Energy Futures, the Just Solar Coalition, Fresh Energy, and other groups focusing on equitable clean energy to keep the “community” aspect of community solar gardens at the center of the program.
“This has been the biggest challenge of my career,” says Logan O’Grady, MnSEIA’s Executive Director. “I personally have worked on community solar negotiations for six legislative sessions, and some of our partners have been involved in these conversations since the birth of the program ten years ago. I am extremely happy to see this comprehensive modernization get done this year. This legislation will usher in a new era for community and distributed solar in Minnesota. Lawmakers just created hundreds of megawatts of clean energy that will benefit all Minnesotans; from farmers to renters to schools to low-income communities and more.”
Progress this Legislative Session wouldn’t have been possible without the tireless work of bipartisan lawmakers in both chambers. We’re especially thankful to House Speaker, Melissa Hortman, Majority Leader Jamie Long for championing CSG reform over the past few years, Representative Patty Acomb and Senator Nick Frentz for chairing their successful Energy Committees, and the Environment, Natural Resources, Climate, and Energy Finance and Policy Conference Committee Members for working hard on a fair compromise. We’re also grateful for the dedication and support of our partners and members who helped MnSEIA advocate for fair CSG policy.
The House is expected to pass the bill today and send it to the Senate where it is expected to pass in the coming days. After Governor Walz’s signature, the new law will take immediate effect. As the Legacy CSG program closes, MnSEIA will be working with the Minnesota Department of Commerce, the Public Utilities Commission, and other stakeholders to ensure a smooth transition to the new programs.
MnSEIA is a member-driven 501(c)(6) nonprofit that promotes and protects Minnesota’s solar and storage industries. We advocate in the state legislative and regulatory arenas in a unified and actionable way to move solar + storage forward. Find out more at www.mnseia.org.
Abbi Morgan, Director of Business Development & Communications