2025 Solar Incentives Guide for Mankato, MN - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Mankato.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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What Solar Tax Credits, Incentives, and Rebates are Available in Mankato?
Xcel Energy - Solar*Rewards Program
Medium-sized Systems 25.1-500 kW: $0.0375/kWh
Large Systems (>500kW): Determined through competitive bid
Wind and Solar-Electric (PV) Systems Exemption
Wind: 100% exemption from real and personal property taxes
Wind Energy Sales Tax Exemption
Xcel Energy (Electric and Gas) - Residential Energy Efficiency Rebate Program
Natural Gas Furnace Existing Home: $200-$400
Natural Gas Furnace New Construction: $100-$200
Natural Gas Hot Water Boiler: $100-$400
ECM Furnace: $100
Central AC: $150-$450
Tank Water Heater: $75-$500
Tankless Water Heater: $250
Attic/Wall Insulation: 30% of project cost
Air Sealing: $150-$200
Furnaces: $200-$425
Boilers: $125-$400
ECM Motor Furnace Fan: $125
Programmable Thermostat: $10
Heat Pumps: $175-$475
Water Heating: $100-$250
Clothes Washer: $10
Refrigerator: $15
Ground Source Heat Pump: $150/ton
Brainerd Public Utilities - Residential Energy Efficiency Rebate Program
Clothes Washer: $35
Electric Clothes Dryer: $35
Refrigerator: $35
Freezer: $35
Dehumidifier: $20
Room/Window A/C: $35
High Efficiency Electric Water Heater: $35
Central A/C Tune-Up: $35
Central A/C: $200-$350
Mini Split/Ductless A/C: $250
ECM Replacement Motor: $100
Furnaces: $200-$375
Heat Pump Water Heater: $250
Air Source Heat Pump: $250
Geothermal Heat Pump: $100/ton
Xcel Energy - Renewable Development Fund Grants
Connexus Energy - Residential Energy Efficiency Loan Program
OR
$20,000
Great River Energy (28 Member Cooperatives) - Energy Wise Residential Efficiency Rebates
Home Energy Loan Program
Fix-Up Loan
Renewable Energy Production Incentive
1.0¢/kWh for certain hydro facilities in need of repair
Minnesota Valley Electric Cooperative - Residential Energy Efficiency Rebate Program
Freezer/Refrigerator: $25
Dishwasher: $25
Air-Source Heat Pump: $500
Mini Split Heat Pump: $300
Ground-Source Heat Pump: $200 per ton
Air Conditioner: $100
ECM (Electronically Commutated Motor): $50
Electric Resistance Heating Products: $10/kW
Central A/C or Heat Pump Tune-Up: $25
Electric Resistant Heating Products: $10/kW
Minnesota Valley Electric Cooperative -Residential Energy Resource Conservation Loan Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to make renewable energy usage more affordable via financial incentives to help people install solar panels on their homes. Solar incentives could include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are handled by the federal government, some by the state of Minnesota and some by your specific utility company, county or municipality. Some solar incentives you might qualify for are:
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.
- Rebates: A solar rebate is a partial refund given after you've purchased your solar panels. These might be offered by your local utility company, your state or your county. The cash back that you get from the rebates is normally applied before tax credits are calculated.
- Tax Exemptions: These can come in the form of property tax exemptions, which would allow you to exclude the value added by your solar panels when calculating the taxes you pay on your house. You may also qualify for an exemption on sales tax at the time of purchase.
- Net Metering: Net metering becomes relevant once your solar panels are up and running. If you have in place a net metering agreement with your Mankato utility company, it will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other places you might receive a refund equivalent to a percentage of the value.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some knowledge of. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC allows you to claim a tax credit for a set percentage of the cost of your solar system.
The ITC applies to a solar system installed on your primary or secondary residence in the United States. The solar panels must have been installed after January 1, 2006, on a property owned by you for you to be eligible for the credit. Originally, the ITC covered 30% of all system costs (panels, accessories, equipment and labor), although the total amount has fluctuated slightly over time between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the amount you can claim.
Curious how the ITC might apply to your specific situation? Contact your local Mankato solar panel installation expert to get more information.
The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Homeowners are now eligible for a credit equal to 30% of the total costs of solar system installation for projects that began after January 1, 2022, and will be finished by the end of 2032. The credit percentage will then begin to decrease on a yearly basis until the Clean Energy Credit ends in 2035. Starting in 2023, the expansion to the program will also make credits for energy storage systems even easier to claim.
More information about the new Inflation Reduction Act can be found here. Your local Mankato solar panel installation expert is the best person to answer your questions about the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. As with federal incentives, these might include rebates, tax credits and more. These incentives may be provided by the Minnesota government, or by your county or municipality. Some incentives may be ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Mankato
Nationwide solar energy use has significantly increased in the past 15 years, in part due to the proliferation of solar incentives. You can obtain these incentives from the federal government, the Minnesota government or your local utility company. Your local Mankato solar panel installation expert can provide you with more details about which incentives you can apply for, and get you started on the path to switching to renewable energy today.
EcoWatch's Mankato, MN Solar Incentives FAQs
If I installed solar panels on my house a few years ago, can I still claim incentives?
An excellent idea would be to talk to someone from the company that installed your solar panels – or reach out to a local Mankato solar installer — to learn about which incentives you may qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
When does the federal solar tax credit end?
The federal solar tax credit, formerly known as the ITC and now titled the Clean Energy Credit, is scheduled to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I claim incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can receive both rebates and tax credits towards the cost of your solar panels. Depending on precisely which incentives you are receiving, they may apply in a different order. Be sure to talk to your solar installer or a local tax professional to confirm that you are claiming the correct incentives and that you're getting the most money you can.
Can I claim incentives for adding solar panels to a vacation home, rental property or commercial property?
Many solar incentives apply to a property you own that is located within the United States; most secondary residences will fall into this category. Other solar incentives may be available for commercial properties, depending on the details. We recommend talking to your local solar installer and/or tax professional to best understand what incentives apply to your specific situation.
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