Minnesota Senate debates effectiveness of community solar garden program amid rising costs

In a recent meeting of the Minnesota Senate Committee on Finance, discussions centered around the future of the community solar garden program, which has been a significant part of the state's renewable energy landscape since its inception. The program was designed to foster a solar marketplace in Minnesota, but concerns have emerged regarding its cost-effectiveness and impact on ratepayers.

Senator France highlighted the program's success in creating a vibrant solar industry, noting that Minnesota now boasts a competitive solar market. However, he expressed concerns about the financial burden placed on Xcel Energy ratepayers, particularly as the costs associated with community solar have risen significantly. Currently, approximately 1.4 million Minnesotans are affected, with an estimated monthly cost of $7 per ratepayer due to the program. In 2023 alone, Xcel customers paid $262 million for community solar, which accounted for about 30% of the utility's fuel clause, despite generating only 5% of the energy.

The senator argued that the community solar garden program is no longer the most effective means of delivering clean energy, especially as utility-grade solar options have become more affordable and prevalent. He pointed to California's recent policy changes, which alleviated an $8 billion burden on ratepayers, suggesting that Minnesota should consider similar reforms.

Senator Champion raised questions about the timeline for sunsetting the program, emphasizing the long-term financial commitments involved. While some committee members expressed a desire for an earlier sunset, Senator France noted that an agreement had been reached to maintain the current timeline until 2030.

The conversation also touched on a benefit-cost analysis conducted by the Department of Commerce, which Senator Pappas referenced as showing the program's cost-effectiveness. However, Senator France criticized the study for not adequately addressing the impact on non-subscribing ratepayers, suggesting that it did not reflect the broader financial implications of the program.

As the committee continues to evaluate the community solar garden program, the discussions underscore a growing urgency to balance the goals of renewable energy expansion with the financial realities faced by Minnesota's ratepayers. The outcome of these deliberations could significantly shape the state's energy landscape in the coming years.