Minnesota can expect exponential growth in solar power over the next seven years under the state’s new energy law, a state Commerce Department official said Friday.
“There has been a real ramping up of solar deployment in this state and we expect to see that increase by a great deal, exponentially, between now and 2020,” Stacy Miller, administrator of solar programs at the department, said at a conference in St. Paul.
Minnesota has about 14 megawatts of solar power online, 25th among states. Miller said solar output could grow to 400 megawatts by 2020 under the state law requiring investor-owned utilities to get 1.5 percent of their power from the sun. That’s about the output of a major power plant.
Miller presented data on the state’s solar market at the Solar Powering Minnesota Conference at the University of St. Thomas. Large projects the size of several football fields, known as utility-scale solar arrays, will play a major part of the solar growth, accounting for a projected 265 megawatts of output.
But rooftop solar also is expected to increase from about 1,000 residential systems today to 4,000 in 2020, mostly atop homes of customers of investor-owned utilities, she said. Cooperative and municipal power companies successfully lobbied to be exempt from the 2013 solar law.
The U.S. solar industry had a record year in 2013, with installations up 41 percent over 2012, and the cost down 15 percent, according to a report by GTM Research and the Solar Energy Industries Association released earlier this week.
Miller said Minnesota and Wisconsin ranked as the top two states with the biggest price decreases.
In a sign of the impending solar boom, Xcel Energy, the state’s largest utility with 1.2 million electric customers, said this week that it will soon solicit bids from energy developers for up to 150 megawatts of utility-scale solar projects. That would be, by far, the largest solar acquisition in the state.
Many utilities favor large-scale projects because of the favorable costs. Xcel said the average cost per installed watt is $2.04 for utility-scale projects, compared with $4.72 per installed watt for home rooftop systems. Xcel hopes to take advantage of the 30 percent federal investment tax credit for solar, which is scheduled to drop to 10 percent in 2017.
The state’s solar law also boosted incentives for solar panels, including those made in Minnesota. The Commerce Department plays a major role in overseeing or administering those programs, which subsidize residential and commercial projects.
Minnesota companies that stand to gain in the solar market include TenKsolar of Bloomington and Silicon Energy of Mountain Iron, both makers of solar panels, and Solar Skies, an Alexandria-based maker of solar thermal collectors. Companies that are not strictly solar also stand to gain, such as Crenlo, a Rochester metal fabricator that has a deal to build cabinets for solar power inverter manufacturer Nextronex of Toledo, Ohio.
Minnesota also is home to companies like Geronimo Energy of Edina, Westwood of Eden Prairie and Juhl Energy of Pipestone that plan, engineer or build solar and wind projects. But they could soon see some competition from big out-of-state players.
ConEdison Solutions, the energy development arm of the giant New York utility, had a booth at Friday’s conference. John Haaland, a regional account representative, said ConEdison intends to build solar projects in Minnesota, likely making a pitch to build utility-scale solar arrays for Xcel.
“One of the things that is really changing in the market is the interest of some very large players that are doing a lot of solar work throughout the United States and the world,” said Kim Harvey, a state Commerce Department official who oversees a Minnesota-made solar subsidy program.
“They have salespeople, installers, manufactured products and financing all packaged together,” he added. “That really provides the opportunity for folks to do turnkey projects at a very cost-competitive price.”