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Energy-Efficiency Funds and Demand Response Programs, Minnesota

Updated July 2007

What public-purpose-funded energy efficiency programs are available in my state?

Minnesota has no public-purpose-funded energy efficiency programs.

What utility energy efficiency programs are available to me?

State law requires regulated electric utilities to invest 1.5% (2% for Xcel) of their in-state revenues in the Conservation Improvement Program (CIP). Regulated gas utilities and cooperative and municipal utilities are required to invest 0.5%. Each utility develops its own CIP programs, and the cost of the programs is billed back to customers of the utility.

Xcel Energy offers a wide variety of rebates and incentives for high-efficiency technologies, including lighting, air-conditioning systems and components, motors, adjustable speed drives, roofing, refrigeration, compressed air systems, and natural gas-fired boilers and furnaces, as well as for custom measures and energy management systems. Also covered are energy analysis and energy design assistance.

Minnesota Power (MP) offers the Power Grant Rebates program, in which incentives are available for energy-efficient equipment, including lighting, air conditioning, motors, energy management systems, refrigeration, and electric cooking equipment. Rebate amounts are either based on the kW or kWh saved over the lifetime of the equipment, up to $50,000 per customer.

Otter Tail Power Company provides the following rebates and grants:

  • Rebates are available for a variety of energy-efficient equipment, including lighting, motors, air-source and geothermal heat pumps, refrigeration, thermal storage technologies, and electric cooking equipment.
  • Grants are available through a competitive bidding process for commercial and industrial customers to undertake energy efficiency projects.
  • The Facility Audit Program subsidizes up to 80% of the cost of an energy audit, up to $10,000.

CenterPoint Energy offers rebates for efficient natural gas-fired equipment, including heating systems and components (new and retrofit), boiler tune-ups, desiccant dehumidification, food service equipment, and natural gas-fired process equipment. Custom rebates are also available.

Minnesota Energy Resources offers the following programs:

  • The Energy-Saving Audits program provides audits for commercial customers. The audit cost is $550 for buildings less than 25,000 square feet and $750 for buildings greater than 25,000 square feet. However, the fee is reimbursed for customers that implement at least one recommended energy efficiency measure.
  • The Minnesota Commercial Prescriptive Rebates program covers heating, HVAC systems, and water heating equipment. Custom rebates will be based on incremental cost as well as peak load and annual energy savings. Prescriptive rebates vary by equipment measure.

Dakota Electric Association offers rebates for motors, adjustable speed drives, various lighting and air-conditioning equipment, vending machine controls, and custom rebates.

Numerous municipal utilities and electric cooperatives offer incentive programs targeted to commercial and industrial customers. The Database of State Incentives for Renewable Energy (DSIRE) web site provides summaries of these programs.

What load management/demand response options are available to me?

Xcel Energy offers two demand response programs that may be of interest to federal customers:

  • The Electric Reduction Savings program is for customers willing to curtail load at Xcel's request. The June-September discount is $4.42-$5.30 per kW of controllable load, and the October-May discount is $2.17-$3.05 per kW. The ranges relate to the number of hours the customer is willing to be curtailed.
  • The Saver's Switch program remunerates customers for allowing Xcel to adjust the customer's air conditioner so it cycles off and on at 15- to 20-minute intervals. Saver's Switch pays a monthly discount of $5 per ton of enrolled air conditioning from June through September.

Otter Tail Power Company offers the following demand response programs:

  • The Released Energy Access Program pays large customers (500 kW minimum peak load) for load curtailments. When Otter Tail expects high prices, it will alert program participants by e-mail of the price offered for released energy. Customers that wish to take the offer reply by making their commitment to curtail a specific amount of power at the required time.
  • The Energy Control program offers nearly 50% rate cuts for customers that allow Otter Tail Power to control specific equipment on their system during on-peak times. The program applies only to customers who are signed up for special off-peak electricity prices.
  • Water Heating Credits are available for customers with direct control water heating. A credit is awarded each month and units may be controlled up to 14 hours per day.

Minnesota Energy offers a commercial dual fuel program. This direct load control program is designed for any electric load where a non-electric backup source of energy (e.g., natural gas as an alternative to electric heat) is available to be used during periods of peak demand. The incentive is roughly 3.5 cents per curtailable kWh.

Dakota Electric Service offers the Controlled Interruptible Service Rate (PDF 922 KB, 19 pp), available to customers that have qualifying interruptible loads that can be controlled by the company. A credit is applied to the monthly bill for all energy (kWh) consumed under this rate.
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What distributed energy resource options are available to me?

The Database of State Incentives for Renewable Energy (DSIRE) provides information on programs that offer incentives for renewable distributed generation. The following programs may be of interest to federal customers:

  • The State of Minnesota offers the Solar-Electric (PV) Rebate Program, in which customers can receive rebates of $2,000/kW (max. $20,000) for PV installations up to 10 kW (and larger, on a case-by-case basis).
  • Minnesota Power's Power Grant program offers $200/kW grants for various renewables installations, of up to $10,000 for 0-100 kW systems, $25,000 for 101-300 kW systems, and $50,000 for systems over 300 kW.
  • Xcel Energy's Renewable Energy Development Fund provides grants periodically through a Request for Proposals process. Renewable energy technologies eligible for funding typically include wind, biomass, solar, hydroelectric, and fuel cells. Funding is generally split between new development projects that result in the production of renewable energy, and research and development. A third round of funding, with up to $23 million available, closed in July, 2007, but future opportunities are likely.

Are there energy efficiency programs sponsored by state government?

The Energy Division of the Minnesota Department of Commerce administers a variety of energy efficiency programs. However, no state-sponsored energy efficiency programs are currently available to federal customers.

What additional opportunities are available to me?

Federal customers also have energy efficiency opportunities available with utilities (such as Aquila, Xcel, and CenterPoint) that have area-wide contracts with GSA and, by extension, all other federal agencies. Federal facilities should contact their account executive to determine the level of participation by their local utility.