Community solar gardens:
Frequently Asked Questions
Is there enough sun in Minnesota for solar to work?
Yes, solar panels power thousands of homes in Minnesota. Minnesota gets more sun per year than areas of Texas and the Northeast where there is already much more solar installed. Minnesota also gets more sun per year than Germany, with one of the largest solar industries. While short winter days mean we get less winter power than many other areas, long summer days make up for this. Solar electricity is powered by light - not heat - so cold, clear days in the winter generate lots of electricity. The reasons you don’t see solar everywhere right now are largely political and have to do with how our energy companies operate, not the amount of sun..
Why is Community Solar helpful?
Many in our community face high energy bills and wish to reduce energy costs. Solar cuts energy costs and generates clean energy while creating local jobs. However, many people can’t put up solar on their own homes because they rent, have a shaded home, or can’t afford it. Community solar makes solar affordable by building a large solar array on a sunny roof or open area, reducing the cost for each subscriber. Community solar can also make solar available to anyone who pays an electric bill by allowing renters, homeowners, businesses, and organizations to subscribe for solar power that cannot be located on their home.
Who can subscribe?
Be based in the same or adjacent county as the solar array
Pay an electric bill to Xcel Energy
What does subscribing mean? What do you get from subscribing?
You can subscribe for energy produced from part of the solar array. You can subscribe for up to 120% of your usage. Xcel Energy gives you credit on your electric bill for any amount of solar for which you subscribe. Monthly credit will depend on amount of sunlight reaching the array production is usually highest in June and lowest in December. With full subscription, over the course of a billing year, the credits you receive from Xcel generally will exceed the amount you pay per kWh. Bill credit rates for the project are:
$0.15539 per kWh - Residential
$0.14844 per kWh - Small Business (not demand metered)
$0.12515 per kWh - Large Business (demand metered)
The bill credit you receive will increase to match any increases in electricity costs, so you will be protecting yourself from rising energy costs. The bill credits will vary in future years based on retail rates. While these are unpredictable, they have gone up 4.60% a year on average for the last 15 years. Assuming a conservative 3% rise in energy costs, subscribers initially save 6%; the savings escalate thereafter. Average projected savings on energy costs over the 25-year project life is over 20%. By the end of the project, with the array fully paid for, CEF projects annual savings at over 40% of your bill.
What if I move? What happens to my subscription?
One of the benefits of community solar is that you don’t lose your value if you move. If your new location is still eligible (served by Xcel and in the same or neighboring county as your solar garden), you can take your subscription with you and apply it to your electric bill at the new address. Also, if your new location is served by Xcel Energy in Minnesota, your subscription can likewise travel with you. If you leave the area and so are no longer eligible, you can transfer your subscription to someone else.
How does this benefit the community?
Community solar reduces energy costs for participating households, keeping more energy dollars in the community. In addition, CEF employs local residents to build and maintain community solar gardens, including providing working people with on-the-job training to be able to install more solar arrays in the future. The project will also reduce dependence on non-renewable energy coming from out-of-state.
How do we know the community is getting the benefit?
Unlike those developed by other developers, our community solar gardens will be developed, owned, and operated by a democratically controlled member-owned business, Cooperative Energy Futures. Subscribers must be members of Cooperative Energy Futures. Members can run for and elect the Board of Directors and can participate in optional member meetings. It is a cooperative organization governed by the 1-member, 1-vote principle. As a cooperative, members also share in the profits the co-op generates at each year's end, all profits are reinvested in other energy-efficiency programs, toward the purchase of additional renewable energy, and/or are distributed directly back to members. Currently, the energy dollars we pay on our utility bills make money for someone else by paying them to invest in energy sources that often cause problems for our community. Through cooperative community solar, we devote our energy dollars to community-owned renewable energy solutions.
Will I see my savings every month?
Generally, yes. However, in some months (usually summer) where the solar production credits reduce your Xcel bill to $0; these additional credits 'roll over' into future months. The sum of your payment obligations to Xcel and CEF may slightly exceed what an Xcel pre-solar bill may have been. This is because you get the full benefit of the extra solar production that month on future months bills when solar production does not exceed your use. Overall, we do not expect that this additional amount would ever exceed 35% of any month's Xcel bill, and in most cases will be much less or a net savings that month. Every year, at the end of February, Xcel "trues up", applying all earned net credits and will send you a check for all outstanding credits not already applied to your bill.
Who makes money on this community solar project?
Cooperative Energy Futures is a member-owned enterprise and is responsible for developing the solar arrays, assembling investors and lenders for project development. Investors will invest in the project to earn tax credits and lenders will lend on the project to earn interest earnings on their investment. Unlike other community solar models, in these projects, subscribers purchase a CEF membership and as co-owners, subscribers are eligible for a share of profits through additional ownership or cash-back dividends based on project performance over time. This is separate from and in addition to the credits applied to subscribers’ energy bills
Who will be responsible for maintenance and managing any changes in subscriptions?
Cooperative Energy Futures is responsible for maintenance and for managing any changes in subscriptions.