✅ Federal Incentives
30% Federal Tax Credit (ITC) for solar + storage systems.
MACRS + Bonus Depreciation for commercial projects.
Direct Pay (Elective Pay) for nonprofits, schools, tribes, and public entities (requires IRS registration).
✅ State Incentives
Sales Tax Exemption: Solar systems are exempt from state sales tax.
Property Tax Exclusion: Most residential systems don’t increase property tax.
State Grants:
Solar for Schools and Solar on Public Buildings programs offer large grants (up to 70% of costs) for public institutions and nonprofits.
PACE Financing: MinnPACE offers low-cost financing in participating areas.
✅ Utility Incentives & Net Metering
Xcel Energy Solar*Rewards:
Pays ~$0.03/kWh for residential production (2025); limited funding, apply early.
Also administers Community Solar, using Value of Solar (VOS) rates.
Other Utilities: Some offer upfront rebates or performance-based incentives - amounts vary.
Net Metering / VOS: Minnesota uses VOS and net metering depending on utility and project type. Export rules vary - check the applicable tariff.
✅ Community Solar Updates
PUC & Court Rulings (2024-2025) have reduced subscriber credit values in some cases. Always verify current VOS rate and contract terms before promoting savings.
✅ For Nonprofits & Public Entities
Combine Direct Pay with state grants (Solar for Schools/Public Buildings) to cover most or all system costs.
Use MinnPACE or state loan programs for gap financing.
Start early to align with grant cycles and registration deadlines.
Summary
The 30% ITC (or Direct Pay) is the core federal benefit.
Sales and property tax exemptions provide immediate savings.
Xcel Solar*Rewards adds value - apply quickly due to funding limits.
Community solar credits have declined - check current VOS values.
Nonprofits and public entities can stack grants and direct pay for high-impact savings.