Solar Power

Solar technology now is a more practical option to add to our energy mix because of its improved affordability. We plan to build or purchase approximately 28 MW of utility-scale solar by 2020 to meet the Solar Energy Standard (SES) in Minnesota.

FAQs about the Minnesota Solar Energy Standard

What does the Solar Standard mean?

In May 2013 Minnesota Governor Mark Dayton signed House File 729 into law. This bill contains a mandate for Minnesota’s investor-owned utilities to serve 1.5 percent of their Minnesota retail electric sales with solar energy by 2020.

  • The new solar standard is part of an existing renewable energy standard that requires 25 percent of Minnesota utilities’ retail sales to be from renewable resources by 2025 and included a stepped implementation of 15 percent by 2015. In addition to the renewable energy standard, the new solar standard requires that 1.5 percent of utilities’ total retail electric sales come from solar resources.
  • At least 10 percent of the 1.5 percent solar standard must be met with solar energy generated by or procured from solar photovoltaic devices 20 kw or smaller.
  • The bill also states that Minnesota’s energy goal is to provide 10 percent of retail electric sales with solar energy by 2030.

What are you doing to comply with this standard?

We plan to build or purchase approximately 25 MW of utility-scale solar by 2020 to meet 90 percent of the requirement.

The remaining 10 percent of the requirement will come from small-scale installations less than or equal to 20 kW. To help meet this requirement, in August 2016 the Minnesota Department of Commerce approved our new Publicly Owned Property Solar program, which provides cash incentives to publicly owned facilities that install solar PV systems.

Can you put “1.5 percent of your retail sales” into perspective?

A mandate to serve 1.5 percent of Otter Tail Power Company’s Minnesota retail sales with solar energy means building or procuring approximately 28 megawatts. To put that into perspective, Hoot Lake Plant is 129 megawatts.

If the company includes utility-scale solar in its generation mix, how will the solar mandate impact customers?

As the cost of utility-scale solar continues to decline, we expect that the impact to customer bills of Minnesota's solar mandate will be little if any.

Can I add a small solar system and sell the energy I don’t use to Otter Tail Power Company?

Yes, if you are an Otter Tail Power Company customer, state incentives, special rates, and tax credits are available for installing photovoltaic (PV) solar panels. If you don’t consume all of the solar energy you produce, we’ll credit the excess generation on your bill through our Net Metering Rate.

How does the Net Metering Rate work?

Net Metering is a rate that we offer to qualifying customers. It measures the output of your renewable system and is used as the basis for any bill credits that may apply.

If your excess generation is less than 40 kw, we purchase it at retail rates. If it’s greater than 40 kw, we purchase it at our avoided cost.

We’re in the process of filing revisions to our Net Metering Rate based on the new standard. We anticipate that eligibility requirements for Net Metering will include that you:

  • Be one of our electric residential or business customers in Minnesota.
  • Produce between 0.5 and less than 1,000 kw. (Systems 1,000 kw or more do not qualify.)
  • Get our approval for your project prior to purchase and installation. If you are installing solar:
    • Install photovoltaic (PV) solar panels that produce electricity. (Solar water heating systems do not qualify.)
    • Own the PV system and the property/building on which the system is installed.
    • Have completed an interconnection agreement with Otter Tail Power Company.
    • Be connected to the grid.
    • Limit the size of the system to 120 percent of your on-site annual electric energy use for solar photovoltaic and other distributed generation.
    • Sign and have an approved application and a contract.

Additional fees and rules may apply.

What is Otter Tail Power Company’s position on solar energy?

We support a balanced resource plan that includes a mix of coal, natural gas, demand-side management, and renewable energy—including solar.

  • We support least-cost planning, which means that we seek the most cost-effective generation resources available. 
  • If renewable resources (including wind and solar) are least-cost resources, we will include them in our preferred resource plan. 

Are any customers eligible for exclusion from the Solar Energy Standard?

The SES excludes electric sales to certain customers from the calculation of total retail sales subject to the 1.5 percent solar energy requirement. The SES also prohibits public utilities from passing the costs of satisfying the solar energy requirement to these customers in rates. By statute, the following customers are eligible for exclusion from the SES:

  • Iron mining and processing facilities, including scram mining facilities
  • Paper mills
  • Wood-product manufacturers
  • Sawmills
  • Orientated stand board manufacturers

Learn more about possible eligibility for exclusion from Minnesota's Solar Energy Standard.