Xcel Energy plans to phase out Solar Rewards program in Minnesota

Xcel Energy plans to phase out Solar Rewards program in Minnesota Xcel Energy wants to phase out its popular Solar Rewards program, which has provided rebates to more than 500 customers who put in place solar electric systems in Minnesota since 2010. By the end of this year, Solar Rewards will have provided $15 million in subsidies to about 560 solar projects in Minnesota, Xcel officials said. Even with the subsidies, though, solar remains more expensive than alternatives to coal power like wind or natural gas, McCarten said. The Solar Rewards program, funded by ratepayers, offers one-time rebates to customers who install solar photovoltaic systems of up to 40 kilowatts. "It's a very rich subsidy -- well beyond what's appropriate," Xcel regional vice president Laura McCarten said of the current rate. Most of the beneficiaries of the Solar Rewards program live in the Twin Cities and many are clustered around Xcel's "Energy Innovation Corridor" that surrounds University Avenue between St. A steep plunge in solar panel costs in recent years caused Xcel to re-evaluate the incentives for solar energy, officials said. The state still offers its "Minnesota Bonus" program that provides a rebate on solar panels made in Minnesota through 2015, tenKsolar CEO Joel Cannon said. Xcel announced its intentions in its 2013-2015 Conservation Improvement Program, filed with the state Department of Commerce Friday, June 1. Furthermore, customer demand for power is nearly flat in Minnesota, so it made no economic sense to subsidize additional expensive solar power, McCarten said. Solar Rewards' money this year is fully subscribed, but the company expects to fund another 150 projects next year even with a reduced rebate, said Lee Gabler, Xcel's director of demand management and renewable operations. Xcel has to meet a state mandate to derive 30 percent of its energy from renewable resources, and so far solar makes up less than 1 percent of its portfolio, Gabler said. 2 kilowatts, according to Xcel. The utility's three-year conservation program proposes to spend $260 million on energy efficiency programs to meet the state's goal of reducing electricity usage by 1. The rebates would end after 2013, the company said. Solar manufacturer tenKsolar in Bloomington doesn't expect to feel much of an impact if Solar Rewards ends. As part of the proposed phase-out, the program will reduce the incentive by one-third from $2. 50 per watt starting next year, Xcel said. Xcel Energy plans to phase out Solar Rewards program in Minnesota Trade News selected by Local Linkup on 03/06/2012