Is Solar Worth It in Minnesota in 2026?
Complete analysis of solar costs, incentives, net metering, and payback for Minnesota homeowners — without the federal ITC.
Cost Per Watt
$3.10
installed
Electricity Rate
$0.200
per kWh
Payback (No ITC)
13.8 yr
current reality
Payback (With 30% ITC)
9.7 yr
hypothetical
25-Year ROI
81%
return on investment
Incentive Breakdown — Minnesota
Available incentives for a typical 7kW residential solar system in Minnesota
Federal ITC (25D)
ExpiredThe federal solar Investment Tax Credit expired on January 1, 2026. No federal credit available for new installations.
State Tax Credit
NoneMinnesota does not offer a state tax credit for solar installations.
SREC Market
Not AvailableMinnesota has a community solar program (Made in Minnesota) but no traditional SREC market.
Property Tax Exemption
Solar system value excluded from property tax assessment
Sales Tax Exemption
No statewide sales tax exemption for solar
Key Incentives: Property tax exemption for solar.
Solar Math — With vs Without Federal ITC
Cost breakdown for a typical 7kW residential system in Minnesota
2026 Reality (No Federal ITC)
- System Size
- 7 kW
- Cost per Watt
- $3.10/W
- Gross Cost
- $21,700
- Federal ITC
- $0
- Net Cost
- $21,700
- Annual Savings
- $1,574/yr
- Payback Period
- 13.8 years
Hypothetical (With 30% ITC)
- System Size
- 7 kW
- Cost per Watt
- $3.10/W
- Gross Cost
- $21,700
- Federal ITC (30%)
- -$6,510
- Net Cost
- $15,190
- Annual Savings
- $1,574/yr
- Payback Period
- 9.7 years
Impact: Without the federal ITC, Minnesota homeowners face a 4.1-year longer payback period — paying $6,510 more out of pocket.
Net Metering Policy — Minnesota
How Minnesota compensates your excess solar production
Full retail rate net metering — you earn the same rate you pay for electricity. Best case for solar savings.
Minnesota mandates net metering for systems up to 40 kW at full retail rate under PUC rules.
Cost Per Watt Benchmark — Minnesota
Minnesota Average
$3.10/W
National Average
$3.05/W
Typical 7kW System
$21,700
Minnesota's average installed cost is above the national average of $3.05/W
Breakeven Timeline
Without the federal ITC, a typical 7kW system in Minnesota breaks even in 13.8 years. With the former 30% ITC, payback would drop to 9.7 years.
Without Federal ITC
13.8
years to break even
With Former 30% ITC
9.7
years to break even
Production Details
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