Xcel Energy, Minnesota’s largest utility, said Monday it aims to meet a major portion of a new state requirement for solar power generation by encouraging developers to build large solar projects over the next three years.
The company told state regulators it will seek deals with developers who put large arrays of solar panels — generally capable of producing 5 to 20 megawatts of power — on buildings, parking garages and elsewhere.
Xcel plans to buy the power that such arrays generate to comply with a 2013 Minnesota law requiring utilities to acquire at least 1.5 percent of retail electricity sales from solar by 2020.
“We are excited to develop solar resources that provide customer value and offer new customer choices,” Dave Sparby, chief executive of Xcel’s Northern States Power Co.-Minnesota, said in a statement.
“We plan to leverage the economies of large-scale systems to keep the cost as low as possible for customers.”
Xcel said it wants to be purchasing 150 megawatts of power from such solar projects by the end of 2016, putting it halfway to the 300 megawatts it currently estimates it will need to comply with the law in 2020.
Minneapolis-based Xcel now generates 139 megawatts from solar projects, enough to provide power to about 36,000 homes. Nearly all of that capacity is in Colorado, Xcel’s second-largest market after Minnesota.
Even with the additional projects in Minnesota over the next six years, solar would represent a very small portion of Xcel’s total power capacity, which is now 17,000megawatts.
Jim Alders, a regulatory consultant at Xcel, said the company anticipates making another request for developers to build solar arrays in the state in 2017 or 2018. The amount of power Xcel seeks then will depend on what happens with several other solar programs. Xcel is encouraging smaller-scale solar work, including home installations and projects called “solar gardens,” in which residents of multi-family housing can have access to shared solar arrays for electricity.
“The amount of solar generation that’s created in those smaller-scale programs will influence how much power is needed in subsequent large-scale” projects, Alders said.
The state’s second-largest utility, Great River Energy, last month announced plans to build solar arrays that are to generate 650 kilowatts of electricity by the middle of next year. As a cooperative, Great River was exempted from Minnesota’s new 1.5 percent solar requirement. However, the company can use the solar project to meet another renewable mandate of 25 percent by 2025.