Xcel Trying to End Solar Rewards

Xcel Energy, the electrical utility for Minneapolis, has submitted a new Conservation Improvement Program (CIP) document that would do away with their Solar Rewards program.  Thanks to some good work by our Sustainability Director Gayle Prest and Regulatory Energy and Environment Chair Elizabeth Glidden, the City is now on record opposing this change.


Here's a little bit about the program Xcel wants to dismantle.  The Solar Rewards program offers a financial rebate for qualifying small / medium sized solar photovoltaic (pv) installations.  It is fully subscribed and has been successful.  For example, from our comments, "In 2011, within the City of Minneapolis geographic area, there were 30 solar projects totaling 216 kW that received Solar Rewards rebates compared to only two solar installations in 2009, the year prior to the start of the Solar Rewards program."

As we try to build a robust, self-sustaining solar industry, rebates are essential.  Unfortunately, the rebates at the State and Federal level have been extremely inconsistent.  Xcel’s decision to scrap Solar Rewards would add to that inconsistency.  As the City's comments state: "according to a local solar installer, even with the Solar Rewards program and federal incentives, the time for Return on Investment for a homeowner is typically 10-15 years. If the Solar Rewards program is eliminated we predict that the number of installations will dramatically decrease and the recent successes in driving down costs will be undermined."

Other justifications Xcel attempts are similarly not compelling.  They state that, with near flat growth in customer demand, "the addition of new solar generation no longer makes economic sense at this time."  The City has rightly pointed out that "this is a short sighted view, and largely inconsistent with the intent of the Solar Rewards program. The program was never intended as a response to load growth, but as a stepping stone to developing a self-sustaining market in clean energy generation."

Lastly, it's not as if Xcel is providing reliably clean energy.  The carbon intensity (the amount for greenhouse gases produced per unit of energy consumed) for Xcel’s NSP region increased 4.6% in 2011 compared to 2010.

Xcel’s attempt to scuttle Solar Rewards betrays a disappointing lack of commitment to solar, and to renewable energy generally.  In my opnion, this illustrates the need for Minneapolis to keep our energy options open by exploring a municipal utility.