Community Solar Expanding in Minnesota

Market to Market | Clip
Jan 20, 2023 | 7 min

There are dozens of solar projects in Minnesota that fall under the category of “Community Solar”, where solar energy is sold directly to consumers rather than adding electricity to the general grid. 


A load of steel arrives on a November morning near Bird Island, Minnesota. The seven  acre site on the edge of town will host a 1.4 megawatt solar garden, enough energy generation capacity to power roughly 200 Minnesota homes.

It is one of dozens of solar projects in Minnesota that fall under the category of “Community Solar”, where solar energy is sold directly to consumers rather than adding electricity to the general grid. 

Lissa Pawlisch, CERTS, University of Minnesota Extension:  “I think there are a lot of people who would really like to participate in solar, but for whatever reason, they don't have the right roof. They don't have the right money right now. They're not in an area where it seems tenable, but they really want to participate. I mean, they they're watching clean energy happen around them. And they they want to know this is for me, too.”

Minnesota has more solar capacity in the community solar category than the entire country combined, the result of legislation signed in 2013.

Lissa Pawlisch, CERTS Director, University of Minnesota “Well, I think the fact that there is not a cap on how much community solar can be developed is a big part of that magic formula But because there's not been a cap, it has really allowed that private sector development to continue as long as there are households who want it and area available to do the development. It has grown just leaps and bounds in a continuous way,.”

Statewide, there are over 400 community solar sites generating over 825 megawatts of electricity. While 28,000 community solar subscribers purchase the solar energy, only 14 percent of the energy is used by residential customers. 

Called Community Solar Gardens, the legislation encourages the use of a commercial or government purchaser as an anchor subscriber. This helps those planning solar farms to acquire financing for the project and provides a pathway for the purchase of energy left over as residential subscribers come in and  out of the program.

The Minnesota code for community solar also requires the energy generated by a garden to be used by a subscriber in the county of generation or an adjacent county. The rule has resulted in a surplus of landowners interested in leasing acres that lack enough potential customers in the immediate area to justify a project. 

Reed Richerson, COO, US Solar:  “You know, electrical wires don't stop at a county border. There's a disconnect because there's waitlists of people that want to subscribe to these projects. And there are wait lists of people that want to host it on their property. And there's just this artificial barrier in between that says that you two don't line up.

When community solar developers propose a solar project to a landowner, they focus on the consistency of the project.

Reed Richerson, COO, US Solar: “It's similar to the residential subscriber message. It's ‘take control of your the value that you can generate from your property.’ You know, if we're approaching a farmer or landowner, we are likely proposing to only occupy a portion of their property. And we can offer typically higher rates than can be earned through traditional agriculture. But we're not prohibiting the continued use of agriculture.

Landowners interested in hosting a community solar garden are drawn to benefits that are both financial and structural. Many solar gardens are placed on sites that are often difficult to farm or are of marginal quality for row crops. Leases can result in income that is a multiple of potential crop income in a given year, and that rate is guaranteed for up to 25 years. 

Solar’s impact on Minnesota agriculture has been limited. Less than 20,000 acres of solar projects have been completed in the state, a small footprint compared to the 1 million acres of Minnesota farm ground that are in CRP, and a sliver of the 25 million acres devoted to agricultural production in the state.

Reed Richerson, COO, US Solar: “Solar panels are pretty good neighbors. And once you visit solar sites or, or even have one in your community, you tend to start to realize that they're they're quiet once they're installed.”

Many solar projects use cover crops  rather than hard surfacing, which can improve soil quality. This can both limit erosion and filter runoff, which can improve the water quality of nearby lakes and streams. Many of these areas benefit from being grazed, which can provide another revenue stream for the landowner.  The solar industry is also experimenting with growing row crops and vegetables beneath solar panels, finding both yield increases for the crops and performance improvements in the panels. 

Community Energy Futures of Minneapolis has spent the last decade building community solar gardens as a co-op, focusing on residential customers for the majority of their electricity volume. Working in urban environments, they have sited solar gardens on the roofs of structures like churches, government buildings, and a parking ramp in downtown Minneapolis. A government or non-profit acts as the primary buyer  of the electricity, while the majority of the electricity is sold to residential customers. Xcel Energy, which services 3.7 million electrical customers in eight states and is the primary electrical provider in the southern half of Minnesota, issues a credit to residential customers who purchase electricity from community solar gardens. 

Community Energy Futures has been seeking out  households with  lower incomes to join the co-op  and help them earn discounts on their electric bills. 

Pouya Najnaie, Policy and Regulatory Director, Cooperative Energy Futures: “So luckily being in this state, there are, you know, people like I mentioned that just get co-ops right away., I don't have to put panels on my house, I don't have to pay anything upfront, I might be a renter. My house might be shaded, maybe I need a roof replacement. I can't afford it right now.”

Solar Garden developers say most subscribers will see electrical rates drop when they sign up with a CSG, and once the installation costs are covered, consumers will enjoy static electrical rates for up to 25 years, 

Pouya Najnaie, Policy and Regulatory Director, Cooperative Energy Futures: “All these reasons build up that momentum and what I'm finding a lot of time is like the CSG momentum in general for community solar gardens is growing big time. We just need to do more catching up on like hey, CSG is are great, but look at this model of CSG. Look at the co-op model versus the model you're getting.”

With another 400 MW of community solar projects in the planning stages, developers in Minnesota look to continue that momentum.

For Market to Market, I’m Peter Tubbs