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Solar for Minnesota weatherization assistance participants

July 2022

By Chris Meyer
Central, MN Metro, MN Northeast, MN Northwest, MN Southeast, MN Southwest, MN West Central, MN

While a median-income Minnesotan pays about 3.5% of their income for home energy bills, in 2021 94,000 Minnesota households with incomes 50% below the Federal Poverty Level paid about 33% of their income.

One way to reduce this energy burden in a longer-term way is with on-site generation of solar electricity, but solar electric energy and cost savings are limited to middle- and upper-income families due to high up-front costs and credit requirements. To improve solar access for lower-income families, in 2019 Minnesota became the second state in the country — after Colorado — to add solar photovoltaics (PV) as a technology allowed under the Weatherization Assistance Program.

Participating organizations in the Weatherization Assistance Program began selecting houses for a pilot program in late 2019, but the COVID-19 pandemic delayed the start of those solar installations.

By the end of 2021 however, 15 homes had solar PV installed with an average annual savings of $587 on their electric bills.

The pilot program was offered only in Xcel Energy territory because it used Xcel Energy’s Income-Qualified Solar*Rewards rebate program.

Kellye Rose, former weatherization leveraging specialist at the Minnesota Department of Commerce, shared how the program came into existence and the hopes for its future.

We are expanding to other areas of the state, with several projects in Greater Minnesota being implemented by community action agencies (CAA). These CAAs are Semcac (based in Rushford) and Tri-County Action Program (based in Waite Park). Project ramp-up outside the service territory of Xcel Energy has been slower than we had hoped, primarily due to the heavy current project load of both Weatherization Assistance service providers and solar installers. Using solar PV on Weatherization Assistance households to directly reduce the resident’s energy burden is a new endeavor for the Weatherization Assistance Program, requiring a longer lead time than standard weatherization work, and service providers are going slowly with implementation to fully learn the process and ensure all steps are thoroughly completed.

Kellye Rose, former weatherization leveraging specialist at the Minnesota Department of Commerce

Including projects to be installed in Xcel’s territory, Rose expects the program to add solar to another 15 to 20 homes by the end of 2022.

Weatherization Assistance Program is a 45-year-old federal program funded by the U.S. Department of Energy (DOE) that provides free home energy-saving upgrades to income-qualified households.

In addition, a significant amount of funding comes from the U.S. Health and Human Services Department and is transferred to the Weatherization Assistance Program from the Low-Income Energy Assistance Program (LIHEAP).

LIHEAP helps households pay their energy bills and in Minnesota is called the Energy Assistance Program (EAP). Both programs are administered by the Minnesota Department of Commerce, with local CAA and other service provider organizations implementing the work. 

By statute the DOE allows only specific energy efficiency related measures to be delivered to qualified participants. The federal Energy Policy Act of 2005 added renewable energy technologies like solar PV to the list, but not until 2018 did the cost of solar components allow Minnesota to consider adding the technology to the program. The DOE currently allows the Weatherization Assistance Program to fund $3,815 of the total system, meaning the majority of the installation cost must be paid for with other funds.

Rose indicated that the 2018 Xcel Energy Income-Qualified Solar*Rewards incentive program was critical to allow the pilot to move forward.

That year Xcel paid a $2 per watt up-front incentive and a 10 year $.07 per kWh back-end production incentive for low-income households. While Weatherization Assistance funds would pay for about 1/3 of each PV systems’ installation cost, the Xcel incentive was available to cover the remainder.

Kellye Rose, former weatherization leveraging specialist at the Minnesota Department of Commerce

The average system size installed during the Weatherization Assistance pilot was 3.6 kW DC. On average, the system was expected to offset 50% of the household’s electricity use and reduce electric bill by 45%. 

The first step in improving access to solar for low-income Minnesotans was seeking DOE approval to including solar in the Weatherization Assistance state plan.

The pilot was approved in 2019 with requirements that the DOE approve all stages of the first five installations. Rose shared that for the first ten pilot installations, the Department of Commerce worked with a single Weatherization Assistance provider serving Scott, Carver, and Dakota counties.

Changes were expected as the pilot program evolved so working closely with limited partners was important. This helped iron out challenges that arose, such as complications working with funding from multiple sources, managing grid interconnection issues, overseeing installation timelines to accomplish both weatherization and solar installation, and identifying the best way to apply Xcel Energy’s back-end production incentive.

The incentive is paid over 10 years rather than upfront, and is used to cover any unexpected maintenance calls during that time so homeowners won’t have to face those costs.

Rose said that once the pilot was complete and approved by the DOE for statewide expansion, additional funding was needed to cover the non-DOE portion of the installation costs for areas outside Xcel Energy service territory. To meet the need, Minnesota’s LIHEAP increased the amount of funds transferred to Weatherization Assistance and approved solar as an eligible measure on which Weatherization Assistance funds could be spent.

According to the National Renewable Energy Labs, Colorado, the first state to create a low-income solar weatherization option also used LIHEAP funds because there is more flexibility in LIHEAP’s definition of weatherization measures.

Rose shared some additional details about the program:

  • Income-qualified homeowners and renters can apply for the EAP and that same application is used for Weatherization Assistance.
  • Once approved, participants can contact their local Weatherization Assistance service provider to request services.
  • Standard measures include attic and wall insulation, air sealing, ventilation including bath and kitchen, furnace and/or hot water heater repair or replacement, and smoke alarms and carbon monoxide detectors.
  • Weatherization measures must be in progress or complete before solar is added to a home to ensure solar energy is used most efficiently.
  • Not all of the 23 weatherization providers in the state have begun adding solar PV to their list of weatherization measures.

Installed solar arrays are sized to generate no more than 100% of the electrical usage of the household. Historically the maximum system size was capped at 5kW DC and only roof mount systems were allowed. Policy changes announced by the DOE in early April of 2022 will now allow larger solar systems to be considered and expand the type of mounting that can be used — increasing the number of homes that can be considered for the program.

Ground-mounted systems, such as pole-mount or ground-racking, are now allowed by the DOE as well as installation on secondary on-site buildings such as detached garages or farm out-buildings.

These changes will work their way into the Weatherization Assistance Program in the summer of 2022 and Rose said she is very excited to see them approved by the DOE. She envisions additional uses, such as at manufactured home sites and on older housing sites with alley garages. 

Rose shared that home owners have been excited at the option for solar PV.

Julia Cordona qualified for weatherization and also had a solar PV array installed on her house through the Weatherization Assistance Program as was reported by Fox9 in 2021.

Cordona said, “Just try to do it. Motivate people to do it. It’s out there. And if you qualify, you can be benefiting from the program.”

Fox9’s story indicated Cordona is estimated to save $700 or about 75% of her energy bills each year as a result of the solar panels.

Watch the Fox9 story: Minnesota Energy Assistance Program

Semcac, a community action agency serving counties in southeastern Minnesota, is participating in the weatherization solar initiative and is currently working on adding solar PV systems to three weatherization homes. Melissa Feine, weatherization program coordinator at Semcac said she sees a benefit for their clients, “Most of a household’s energy assistance grant goes to their heating source (natural gas, propane, etc.), so solar gives the household an opportunity to save on their electric bills as well.”

Expanding access to solar across the state, and in additional housing types, will continue to be a priority for Minnesota’s Weatherization Assistance Program to reduce energy burden for a greater number of income-qualified Minnesotans. At the same time this positions Minnesota as a national leader in evolving the 45-year-old Weatherization Assistance Program in seeking new approaches to offer the best service possible to program participants.

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