Xcel Energy announced yesterday that it is offering incentives to Minnesota electricity customers to install solar panels on top of their homes and businesses.  This new Solar*Rewards program will encourage growth of solar energy in the state by making a one time payment of $2.25 per installed watt of generating capacity to help off-set the cost to customers who install rooftop photovoltaic systems.

The Xcel Energy website states that, “for an average size residential installation of 3.5 kilowatts or 3,500 watts, the incentive payment would be $7,875, or about 30% pf the installation costs.  Solar*Rewards participants must agree to install a system with a capacity of 0.5 kilowatts to 40 kilowatts.  In exchange for the incentive payment, ownership of the Renewable Energy Credits produced by the system will transfer to Xcel Energy for a term of 20 years. Xcel Energy will also buy any energy that a system produces in excess of the customer’s needs.

Through Solar*Rewards, Xcel Energy plans to support the installation of about 2 megawatts of solar energy each year for the next three years or about 450 installed systems annually.