2025 Solar Incentives Guide for Waconia, MN - Tax Credits & Rebates

In this guide, we'll cover the latest solar incentives and rebates available in Waconia.

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.
Get a free quote from one of our trusted Waconia solar installers to see how much you can save.

By EcoWatch Local Advisors

Data Analysis: James Savino

Updated January 24, 2025

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What Solar Tax Credits, Incentives, and Rebates are Available in Waconia?

Xcel Energy - Solar*Rewards Program

Incentive Type:
Performance-Based Incentive
Systems 0.5 kW - 25 kW: $0.005/kWh
Medium-sized Systems 25.1-500 kW: $0.0375/kWh
Large Systems (>500kW): Determined through competitive bid

Solar Energy Sales Tax Exemption

Incentive Type:
Sales Tax Incentive
100% exemption

Wind and Solar-Electric (PV) Systems Exemption

Incentive Type:
Property Tax Incentive
Solar: 100% exemption from real property taxes
Wind: 100% exemption from real and personal property taxes

Wind Energy Sales Tax Exemption

Incentive Type:
Sales Tax Incentive
100% of sales tax

Xcel Energy (Electric and Gas) - Residential Energy Efficiency Rebate Program

Incentive Type:
Rebate Program
Refrigerator/Freezer Recycling: $50
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

Incentive Type:
Rebate Program
Dishwasher: $35
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

Incentive Type:
Grant Program

Connexus Energy - Residential Energy Efficiency Loan Program

Incentive Type:
Loan Program
$7,500
OR
$20,000

Great River Energy (28 Member Cooperatives) - Energy Wise Residential Efficiency Rebates

Incentive Type:
Rebate Program
Varies by measure and member cooperative offering.

Wright-Hennepin Cooperative Electric Association - Residential Energy Efficiency Rebate Program

Incentive Type:
Rebate Program
Ground Source Heat Pump: up to $1,200
Quick Cash Air-Source Heat Pump: up to $900
Quick Cash Air Conditioning: up to $200
Peak Shave Water Heating: $15/kW
Quick Cash Water Heating: Up to $950
Metered Water Storage: $0.06/kWh
Ductless Air Source Heat Pump: $200
Quick Cash Water Storage: up to $300
Dual Fuel: $5/kW
Electric Thermal Storage (ETS) $5/kW
HVAC Electronically Commutated Motor: $50/motor
Pool Pumps: $200-$400

Home Energy Loan Program

Incentive Type:
Loan Program
$20,000

Fix-Up Loan

Incentive Type:
Loan Program
$15,000. Applicants may be eligible for higher loan and term amounts depending on income

Renewable Energy Production Incentive

Incentive Type:
Performance-Based Incentive
1.5¢/kWh
1.0¢/kWh for certain hydro facilities in need of repair

Minnesota Valley Electric Cooperative - Residential Energy Efficiency Rebate Program

Incentive Type:
Rebate Program
Clothes Washer: $25
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

Incentive Type:
Loan Program

Federal Residential Renewable Energy Tax Credit

Incentive Type:
Personal Tax Credit
30% federal tax credit for systems placed in service after 12/31/2021 and before 01/01/2033. Good for: solar water heat, solar photovoltaics, biomass, geothermal heat pumps, wind (small), fuel cells using renewable fuels.

Source: https://www.dsireusa.org/


Solar incentives are meant to help mitigate the cost of installing solar panels on your home. This category of financial incentives is in place to encourage more people to switch to renewable energy. You may be eligible for several types of incentives, such as cash back, discounts or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the Minnesota government and others from the federal government. Types of solar incentives might include:

  • Tax Exemptions: These might come in the form of property tax exemptions, which can let you ignore the value added by your solar panels when paying property tax on your home. You may also qualify for an exemption on sales tax at the time of purchase.
  • Net Metering: You can sign a net metering agreement with your Waconia utility company. This agreement may apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then subtract this value from your utility bill each month.
  • Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
  • Rebates: Rebates, or partial refunds after a purchase, are usually given before any solar tax credits are calculated. Rebates may be given by your local utility company, by your state or by your county.
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Federal Solar Incentives

When people think of solar incentives, federal incentives may be the first thing that comes to mind. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a predetermined percentage of your solar system's cost.

The ITC applies to a solar system installed on your primary or secondary residence in the United States. The solar panels have to have been installed on a property you own after January 1, 2006, for you to be eligible for the credit. The ITC originally paid out 30% of all installation costs (panels, labor, accessories and equipment), although the amount has fluctuated slightly over the years 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.

To know exactly how much money the ITC could save you, get in touch with your local Waconia solar panel installer.

In August 2022, the ITC (now called the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners can apply for a credit equal to 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit expires in 2035. Starting in 2023, it will also be easier to qualify for credits for energy storage systems under the new laws.

Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit will apply to you is to get in touch with your local Waconia solar panel installers.

State & Local Solar Incentives

Some solar incentives may be offered at the local or state level. Like with federal incentives, these could include rebates, tax credits and more. The incentives — which might be provided by your county or municipality, or by the state of Minnesota — could be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Waconia

You can receive solar incentives from the federal government and the Minnesota government, as well as from your local utility company. This increase in availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. When you're ready to make the change to solar energy, getting in touch with your local Waconia solar panel installation expert is an excellent place to start.

EcoWatch's Waconia, MN Solar Incentives FAQs

What are the environmental benefits of switching to solar?

You can decrease your carbon footprint by 450 pounds of CO2 annually by installing solar panels. This adds up to around 9,000 pounds over 20 years. Solar is also a renewable energy source, meaning that making the switch reduces the drain on our planet's resources.

When does the federal solar tax credit end?

The Clean Energy Credit (previously called the federal solar tax credit, or ITC), currently ends on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.

I want to switch my appliances out for ones that are more energy-efficient. Are there any credits I can claim?

The recently passed Inflation Reduction Act provides a number of incentives meant 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.

Can I use a combination of multiple types of renewable energy to power my home?

Yes, you can employ multiple types of renewable energy to power your home — for example, a combination of solar and wind power. You can also use both renewable energy sources and a non-renewable backup source of energy. Be sure to discuss your plan with your local Waconia solar installation expert, to get an understanding of what will be needed and what types of incentives you may or may not qualify for.

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.

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