2023 Solar Incentives Guide for Shakopee, MN - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Shakopee.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
Get a free quote from one of our trusted Shakopee solar installers to see how much you can save.
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated March 14, 2023
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Shakopee?
Xcel Energy - Solar*Rewards Program
Medium-sized Systems 25.1-500 kW: $0.0375/kWh
Large Systems (>500kW): Determined through competitive bid
Solar Energy Sales Tax Exemption
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
ECM Motor Furnace Fan: $125
Programmable Thermostat: $10
Heat Pumps: $175-$475
Water Heating: $100-$250
Clothes Washer: $10
Ground Source Heat Pump: $150/ton
Brainerd Public Utilities - Residential Energy Efficiency Rebate Program
Clothes Washer: $35
Electric Clothes Dryer: $35
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
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
Home Energy Loan Program
Renewable Energy Production Incentive
1.0¢/kWh for certain hydro facilities in need of repair
Shakopee Public Utilities - Residential Energy Efficiency Rebate Program
Refrigerator/Freezer Recycling: $200
Air Source Heat Pump: $200-$500/unit
Ground Source Heat Pump: $100/ton
LED Bulbs: $5
LED Holiday Light Strings: $3
Mini-Split Ductless A/C: $200
Room A/C: $25
Room A/C recycling: $50
Minnesota Valley Electric Cooperative - Residential Energy Efficiency Rebate Program
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
Solar incentives are intended to encourage people to switch their home over to renewable energy by offering incentives that lower the financial burden of solar panel installation and use. Incentives might include things like discounts, cash back or monthly utility bill credits. Some incentives are provided by the federal government, while others are handled by the Minnesota government or by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Tax Exemptions: Your solar panels might qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions allow you to exclude the added value of the solar panels when you are calculating property taxes on your house.
- Rebates: Solar companies may help you claim a rebate, or partial refund of your purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. Any rebates you receive will usually be deducted from the total price before tax credits are calculated.
- Net Metering: Net metering becomes relevant once your solar system is up and running. If you have a net metering agreement with your Shakopee utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other places you may make back a percentage of the value.
Federal Solar Incentives
When someone says "solar incentives," you probably think of federal incentives first. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a specified percentage of the money you spend on solar panels for your home.
The ITC applies to solar panels installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Originally, the tax credit was for 30% of the total cost — for panels, equipment, accessories and labor — although the percentage may range from 26-30%, depending on the installation date of your solar system. There is no cap on the claim amount.
To find out exactly how much the ITC could save you, contact your local Shakopee solar panel installation expert.
In August 2022, the Inflation Reduction Act made revisions to the ITC, now titled the Clean Energy Credit. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After 2032, the percentage will be reduced slightly each year until the program expires in 2035. The expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit might apply to you is to reach out to your local Shakopee solar panel installers with your questions.
State & Local Solar Incentives
There are often state solar incentives available in addition to federal ones. Rebates, tax credits and more can be offered at a more local level. Incentives might be offered by your county or municipality, or by the state of Minnesota. Some incentives are available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Shakopee
Solar energy use nationwide has increased enormously in the past 15 years, in part due to the increase in availability of solar incentives. You can obtain these incentives from your local utility company, the federal government or the Minnesota government. Getting in touch with your local Shakopee solar panel installation company is a great first step towards getting the most money possible when you switch to solar energy.
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Best Social Impact
- Expansive service area
- Makes charitable contributions
- Certified B Corp
- No leases or PPAs
- Quality of installation may vary by location
EcoWatch's Shakopee, MN Solar Incentives FAQs
Can I claim incentives for adding solar panels to a rental property, vacation home or commercial property?
Many solar incentives apply to a property you own that is located within the United States, and 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 may apply to your specific situation.
How can I learn if I qualify for certain solar incentives?
It's a good idea to talk to your local Shakopee solar installer to get an understanding of which incentives your project may qualify for. Usually, solar incentives apply to new solar systems installed on a property you own (in the U.S.) between the dates specified by the incentive. Some incentives, like those provided by the Minnesota government, may have other requirements.
Who installs solar panel systems near me?
To discover the best solar panel installation companies near you, read our article on the top solar companies in Shakopee.
What are the environmental benefits of switching to solar energy?
You can decrease your carbon footprint by 450 pounds of CO2 a year when you switch to solar panels. This adds up to roughly 9,000 pounds in 20 years. In addition, solar power is a renewable energy source, which means that switching your home over reduces the drain on our planet's resources.
If I trade in my appliances for ones that can utilize solar energy, are there any benefits that I can claim?
The recently passed Inflation Reduction Act provides a number of incentives designed to reward homeowners who make eco-friendly upgrades. Some of these incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.