Value of Solar Tariff (Minnesota)
Last modified on February 12, 2015.
Financial Incentive Program
|Name||Value of Solar Tariff|
|Incentive Type||Performance-Based Incentive|
|Applicable Sector||Commercial, Industrial, Residential, Nonprofit, Local Government, State Government, Multi-Family Residential, Agricultural|
|Energy Category||Renewable Energy Incentive Programs|
|Amount|| To be determined by the Department of Commerce|
Rates are locked in for the full 20-year contract
|Eligible System Size||Up to 1 MW|
|Ownership of Renewable Energy Credits||Utility|
|Terms||20-year contract between utility and system owner|
|Program Administrator||Minnesota Department of Commerce|
|References||DSIREDatabase of State Incentives for Renewables and Efficiency|
Note: This program is only available to customers of one of the state's investor-owned utilities (Alliant, Minnesota Power, Otter Tail Power Company, Xcel Energy). Customers of a municipal utility or rural electric cooperative are ineligible for this program.
By January 31, 2014, the Minnesota Department of Commerce (DOC) must develop a distributed solar value methodology and submit it to the Public Utilities Commission (PUC) for approval. The DOC must consult with stakeholders in order to develop the methodology, which must take into account: the value of energy and its delivery; generation capacity; transmission capacity; transmission and distribution line losses; and environmental value. The DOC may also consider: the cost or benefit of solar operation to the utility; credit for locally manufactured or assembled energy systems; and systems installed at high-value locations on the grid.
Once the tariff methodology is approved by the PUC, affected utilities may offer either the Value of Solar Tariff (VOST) or Net Metering.* The utility must apply for PUC approval, and the PUC may only approve the tariff if it:
- Appropriately applies the DOC methodology;
- Includes a mechanism to allow recovery of the cost to serve customers receiving the alternative tariff rate;
- Charges the customer for all electricity consumed by the customer at the applicable rate schedule;
- Credits the customer for all electricity generated by the solar photovoltaic device at the VOST rate;
- Applies all charges and credits to a monthly bill, and excess credits carry forward and expire on the last day of February each year;
- Complies with net metering size limitations;
- Complies with interconnection requirements;
- Complies with standby charge requirements.
The tariff rate cannot be less than the retail rate used for net metering until three years after the PUC approves the utility tariff.
- Utilities that offer a Community Solar Garden program (see Minnesota's Net Metering law) must compensate systems at the VOST rate. Because Xcel is required to offer a Community Solar Garden program, they will be required to offer a VOST.
|Contact Name||General Contact|
|Department||Minnesota Department of Commerce|
|Address||85 7th Place East|
|Address 2||Suite 500|
|Place||St. Paul, Minnesota|
Authorities (Please contact the if there are any file problems.)
|Authority 1:||H.F. 729|
- Incentive and policy data are reviewed and approved by the N.C. Solar Center's DSIRE project staff.