The nation's most consumer-driven expansion of solar power is beginning in Minnesota.
Xcel Energy Inc., serving 1.2 million Minnesota electric customers, said it will begin accepting applications Friday from independent energy developers to construct solar parks whose electricity will be credited to customers who sign contracts for a share of the output.
These solar projects, known as community solar gardens, have been authorized in other states, most notably in Xcel's service area in Colorado. Some Minnesota power cooperatives have built solar gardens for their members to join.
But Xcel's Minnesota program, authorized by state regulators this year, places no limit on the number of solar parks that could be built across the state. That will be left entirely to how many customers want solar — with a potential savings on their electric bills.
"It is such a market-driven response to pollution and climate change," said David Wakely of MN Community Solar, a Minneapolis company that has been working on solar gardens for more than a year and expects to submit two applications on Friday. "We are seeing people all around the state, all walks of life, all political persuasions all piling on because they want energy independence, they want to reduce the amount of pollution that they generate, they want to see their electricity generated closer to home."
With at least a dozen energy developers interested in building solar gardens in the state, Minnesota could end up with 100 megawatts of new solar capacity — the output of a midsize power plant — by the end of 2015, said Laura McCarten, a regional vice president for the utility.
"There is a lot of interest and eagerness to get going," McCarten said in an interview. "There is an expectation that there will be strong interest in the program."
Across Xcel's territory
MN Community Solar, for example, has announced plans for solar gardens in Minneapolis, Gaylord and Northfield, and company officials say they have a waiting list of interested customers in Hennepin County.
Solar gardens are being marketed to people whose homes are unsuitable for solar panels or don't want the hassle of owning and maintaining them. Condo owners, renters and others who want solar also are potential customers.
Under a solar-friendly payment structure approved by the state Public Utilities Commission, customers can save money on solar gardens. The terms will vary among developers, but will consist of a contract for solar power with one-time or periodic payments. The PUC requires insurance and other protections for consumers, including terms for early termination in case a customer moves out of Xcel's service region.
Thor Bjork, an Xcel official who helped develop the Solar Rewards Community program, said the utility will review each developer's solar garden proposal and sign agreements for projects up to 1 megawatt in output. That's the size of the solar array atop the Ikea retail store in Bloomington.
Bjork said Xcel will publish a list of pending and approved solar gardens on its website. But customers interested in solar gardens must sign up with project developers, not the utility. Among other rules, Bjork said, is that customers can participate in solar gardens only if they are located in their home county or adjacent counties.
Adding staff for solar boom
Another company planning to submit solar garden plans on Friday is SunShare, a Denver-based energy developer that was a pioneer in building them in Xcel's Colorado territory. SunShare founder and CEO David Amster-Olszewski said the company has hired 15 people in Minnesota this year and expects to add more.
Amster-Olszewski said the company, which has 12 solar gardens operating or under construction in Colorado, is expanding rapidly and expects to develop 50 to 60 solar garden projects next year, though he would not say how many are projected in Minnesota.
"Our intent is to build as many as we can," he said in an interview.
The Solar Rewards Community program, he said, "is the most forward-looking state and utility policy that I have seen anywhere in the country." Other states, including Colorado, have set caps or other restrictions on how much solar can be added.
Minnesota's program was authorized under a 2013 state energy law that requires investor-owned utilities to get 1.5 percent of their electricity from solar by 2020. Only Xcel was required by law to offer solar gardens.
"Xcel has really set the standard in Minnesota for opening up a program so that any homeowner, tenant in a high rise or small or large business owner now has the option to buy solar energy at their fingertips," Amster-Olszewski said.