February23,2016

PaulHelstromMinnesotaPower

RenewableProgramLead

StacyMillerMinnesotaDepartmentofCommerce

SolarPolicySpecialist

Agenda � OverviewofSolarEnergyMarketsintheUS� OverviewofMinnesotarenewablepolicy,markets�  FederalIncentivesforSolar�  Statepoliciesandprograms� UtilityIncentivesandprograms� Howdoyougetinvolved� Technologiespushingsolarforward

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Na)onalTrends �  Largedevelopmentsinsolar

� Decreasingcostshasleadtorapidgrowth�  Solarisafastgrowingenergyresourceintheworld,theUSandMinnesota

�  Lotsofgrowth=opportunityfornewbusiness,jobs,economicactivity.

�  Somechallengesfacetheadoptionofsolar�  Technicalintegration�  Costandvaluepropositions

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Graphic:SEPA-solarsnapshot 5

Graphic:SEPAsolarsnapshot 6

ChallengesforSolar � Costisstillachallenge� Gettingtheratestructureright

� Nationaldebatesandregulationsinflux�  NetMetering�  ValueofSolar�  Regulatoryproceedingsinhighpenetrationstates

�  Hawaii,Nevada,Californiaexamples

� Advancedinvertertechnology�  Enablinghighvalueservicestothegrid

� Meetingpeakdemands

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ChallengesforSolar

�  LaborShortages

� Permitting

�  Interconnectionissues

� Billingissues

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ConsumerAffairsOffice�  (651)296-0406or1-800-657-3782consumer.puc@state.mn.usDepartmentofLabor&Industry�  (651)284-5069or1(800)342-5354

ChallengesforSolar

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FederalInvestmentTaxCredit(ITC)�  30%FederalTaxcreditforCommercialandResidentialsystemsinserviceby12/31/2019

�  Sunsetbeginsin2020forcommercialsystems�  2021–26%�  2022-22%�  2024-10%(commercial)

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OtherFederalPrograms � ModifiedAcceleratedCostRecoverySystem(MACRS)

�  adepreciationtooltotakerapiddepreciationofsolarassetsoverafiveyearwindow

� REAPGrants-RuralEnergyforAmericaProgram� Upto$2,500-500,000grantsupto25%ofsystemcost� Upto$25millionloanupto75%ofsystemcost�  Agriculturalproducersandsmallbusinessesinruralareasforenergyefficiencyandrenewableenergyprojects

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MinnesotaRenewables � Minnesota25%renewableby2025�  SolarEnergyStandard1.5%x2020� Newnetmeteringrules� CommunitySolar� ValueOfSolar� StableIncentives

� 10%x2030Goal

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Incen)vesinMinnesota � PropertyTaxIncentive�  SalesTaxIncentive� MadeInMinnesota� UtilityIncentives

� MinnesotaPower�  Xcel� Others

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NetMetering�  Investorownedutilities:

� Netmeteringcapraisedto1MWin2013

� Single-customermeteraggregationoncontiguousproperty

� Nostandbycharges<100kW

� Systems40kW-1,000kW

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NetMetering�  Cooperative&municipalutilities:ChangeseffectiveJuly1,2015

� Netmeteringlimitremains40kW� Netmeteringfeesauthorizedundercertainconditions:

Acooperative…ormunicipalutilitymaychargeanadditionalfeetorecoverfixedcostsnotalreadypaidforbythecustomerthroughthecustomer'sexistingbilling.Anyadditionalchargemustbereasonableandappropriatebasedonthemostrecentcostofservicestudy.

�  Customersforfeitexcessgenerationattheendoftheyearunlesstheyelecttoreceivemonthlycompensationatretailrate

�  CustomersinterconnectedpriortoJuly1,2015unaffected.15

CommunitySolar� XcelEnergyprogramisthelargest

� Minimumof5subscriberswhomustbeinacontiguouscounty.

�  Asinglesubscribermaysubscribeto40%ofasystem�  Subscribersreceiveon-billcredit

�  17co-opsandMoorheadPublicServicehavecommunitysolarprogramsplannedoravailablenow

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Made in Minnesota Solar� MadeinMinnesotaPV

• $15 million/year through 2023 • Xcel Energy, Minnesota Power, Otter Tail Power • Production Based Incentive (PBI) • Projects < 40 kW Commercial, < 10 kW Residential • Applications accepted annually Jan 1 – Feb 28

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MadeinMinnesota2016SolarThermalIncen)ves

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MadeinMinnesotaPar)cipa)onEligibility

�  CannotreceiveautilityincentiveinadditiontoaMadeinMinnesotaincentive

�  Mustbeacustomerofaninvestor-ownedutilitytoparticipate:MinnesotaPower,XcelEnergy,OtterTailPower

SolarPV�  Commercialsystemsmusthaveacapacityoflessthan40kWand

residentialsystemsmayhaveacapacityofupto10kW.SolarThermal�  Thesolarthermalsystemsmaybeinstalledinresidentialandcommercial

facilitiesfor,amongotherpurposes,waterheating,spaceheating,andpoolheatingpurposes.Openstatewideifthereareunusedincentives.

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XcelEnergySolar*Rewards�  $5millionannually2014-2017� ProductionBasedIncentiveof$.08/kWhpaidannuallyfor10years

�  20kWmaximum� DakotaElectric,Rochester,MinnesotaPower,OttertailPoweralsohavesmallsolarprograms

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SolarSense�  Availableforsolarphotovoltaic(PV)andsolarthermalsystems�  Lotteryapplicationprocess

�  ClosesFebruary28thSolarPV�  Capacity-based,tieredrebate

�  $750/kWbaseincentive�  $250/kWNABCEPcertifiedinstaller�  $250/kWnon-profitortax-exemptcustomers

SolarThermal�  Rebateofupto25%ofprojectcosts,nottoexceed

�  $2,000forresidential�  $4,000for2-3familyunits�  $10,000for4ormorefamilyunits�  $25,000forbusinesses

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IncentivesDatabase

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www.dsireusa.org

NABCEPCer)fica)on� NorthAmericanBoardofCertifiedEnergyPractitioners(NABCEP)

� www.nabcep.org� Certificationoffersthepublicahighdegreeofprotectionbecausepractitionershavetovoluntarilymeetstandardsandqualificationsandpassanexam.

� RequirementsforbecomingNABCEPcertified�  Installationexperienceandclassroomrequirements� Detailedinformationfordifferenttrackavailableonline

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MinnesotaEducators� HibbingCommunityCollegeProgram:

�  SolarPVTechnicianProgram�  25creditcoursegetsyoutestreadyforNABCEPcertificateofknowledge

� CenturyCollege�  AdvancedSolarPVEnergySystems�  30creditrequirement�  TestsforNABCEPcertificateofknowledge

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TrendsinTechnologiesandPolicyrelatedtosolar

� EnergyStorage�  Technologyadvancements�  Economiesofscaledrivingdowncosts(Tesla)�  Complementssolarenergysystems

� ElectricVehicles� Drivingscaleforstoragetechnologies

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IntroductionMinnesotaPower(MP)requestedassistancefromtheUniversityofMinnesotaDuluthNaturalResourcesResearchInstitute(NRRI)toinvestigatetheperformanceofthreesolarphotovoltaic(PV)arraysinaNorthernMinnesotaenvironment.Thisprojectwouldbeamulti-yearprogramtomonitorsolarsystemoutput,reliability,andotherfactors.Three10kilowattarraysweretobeinstalledontopofthesixstoryGovernmentServicesCenter(GSC)indowntownDuluth.ThedatafromthisstudywillbeusedinternallyatMPandthearrayswouldbeashowpieceforSt.LouisCounty,aswellasacomponentofthepursuitofLEEDcertificationfortheGSC.ThisstudywouldbethefinalportionofthePyramidofConservation,asrenewableenergygenerationgenerallyrequiresthehighestinvestment.ThePyramidofConservationispartofMP’sPowerofOne®ConservationImprovementProgram.

Silicon Energy Trina Solar TenK SolarModel Number SiE 205Wp TSM-PA05.08 250Wp RAIS XT-A 410WpTotal Modules 52 40 24 Installed DC (kW) 10.66 10.00 9.84 Installed AC (kW) 10.00 10.00 9.00 Tilt (Degrees) 30 30 26 Module Space Used (ft2) 832 704 667 Total Space Used (ft2) 1,551 1,470 1,097 Total Ballast Weight (Pounds) 18,656 21,856 7,840 Inverter Used Frontius IG Plus 10.1-3 Delta Frontius IG Plus 10.1-3 Delta APS TY500A MicroinverterMounting System AET Rayport B AET Rayport B Integrated into System

Month Total Production (kWh) Capacity Factor (% )Jan-15 1,277 5.6Feb-15 2,663 13.0Mar-15 3,940 17.4Apr-15 4,127 18.8May-15 3,805 16.8Jun-15 4,695 21.4Jul-15 4,874 21.5Aug-15 3,952 17.4Sep-15 3,511 16.0Oct-15 2,808 12.4Nov-15 1,580 7.2Dec-15 531 2.3

Total 37,763 14.1

Total System ($)Total Installed Cost 170,193$ Incentives

MP Conservation Contribution 42,375$ MP SolarSense Rebate 70,000$

Total Incentives 112,375$ Net Cost 57,818$

ObjectivesNRRI’sobjectivewouldbetovalidateandanalyzethedatafromthethreesolarPVarraysinDuluth,Minnesota.Specifically,MP’sresearchgoalsforthisresearchprojectincludedtopicssuchas:•  Relativeperformanceofarraysinthe

shortandlongterm.•  Correlationofactualdatatomodeled

datainaMinnesotaclimate.•  Generationreactiontoweather,e.g.,

cloudcoverandlowlightsituations.•  Validatevendorclaimsinregardsto

production.•  Understandinstallationmethodsand

procedures.•  Performancemeasuredagainststandard

pyranometermeasurementsThisstudywastobeanempiricalstudytoinvestigateactualsolarPVperformanceinaNortheasternMinnesotaenvironment.

MaterialsandMethodsThephysicallocationofthesolarPVinstallationwasontopoftheGSC,325W1stStreet,Duluth,Minnesota55802.AnnualirradianceandweatherdataforthislocationaccordingtotheNRELSAMdatabaseinclude:•  Globalhorizontalirradiance:3.70kWh/

m2/day•  Diffusehorizontalirradiance:1.78kWh/

m2/day•  Averagetemperature:3.2°C•  Averagewindspeed:4.7m/s

ProductiondatawasacquiredfromanE-GaugesystemandMV90inverterdatafromMP.WeatherdatawasprovidedbyaweatherstationattheGSC.

PreliminaryResultsIn2015thethreesolarPVarraysproducedapproximately37,763kWhofelectricalenergyatacapacityfactorof14.1%.Thecarbondioxideoffsetduetothisstudywasapproximately26,300poundsascomparedtoenergyproductionfromcoal.TheactualproductiondatamatchedthesimulateddatarelativelywellexceptforthemonthsofJanuaryandDecember,2015.

Cost of Electricity ($/kWh)Est. Yearly Energy

Savings ($)

Estimated Payback Period, No Incentives

(Years)

Estimated Payback Period, With

Incentives (Years)0.05$ 1,888.16$ 90.1 30.6 0.10$ 3,776.32$ 45.1 15.3 0.15$ 5,664.48$ 30.0 10.2 0.20$ 7,552.64$ 22.5 7.7 0.25$ 9,440.80$ 18.0 6.1 0.30$ 11,328.96$ 15.0 5.1

Thankyou!Ques)ons?� StacyMillerSolarPolicySpecialist(651)539-1859� PaulHelstromRenewableProgramLead(218)355-3270phelstrom@mnpower.com

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Appendix:Howsolarworks

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MinnesotaSolarResource•  Goodsolarpotentialin

MN

•  SolarPVlikesitcoolandclear

•  Goodinstallationsitescanproduce1250-1350kWhperyearperkWpinstalled

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PVSystems

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GridTiedSystemComponents

DC ACDCDisconnect

Inverter 32

GridTiedBaWeryBackup

MainPanel

SolarBackuppanel

ChargeController

Inverter/TransferSwitch

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EnteringtheMarket � Partiesinterestedinjoiningthemarketofsolarinstallationcompaniesshouldconsider:

�  Skillsneeded� Toolsneeds�  Servicesvaluesandexpected

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Ques)ons?

PaulHelstromRenewableProgramLead(218)355-3270phelstrom@mnpower.com

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