In recent years, the popularity of community solar programs has led to an influx of cost-saving options across the United States. Some states have led the charge more than others, developing dozens of facilities in no time at all to help residents and small businesses that could benefit from low-cost energy. Minnesota is among the many states that have emphasized the importance of community solar, but that emphasis may have come with some unexpected issues that may show just how well the state’s leading community solar program can handle the increase in developments.
According to Xcel Energy, a leader in community solar development, it has received approximately 400 new applications for development opportunities in 2020. Each application is from a developer wanting to link their community solar project onto Xcel’s grid and serve the utility provider’s customers with clean, renewable energy. The amass of requests is more than what has been completed in Minnesota in over five years, which is believed to be a result of new credits implemented by state regulators in 2019.
Unfortunately, with the increase in applications, Xcel has begun facing complaints from developers. According to concerns from developers looking to link up with Xcel’s grid, the massive increase in community solar programs has caused concerns over cost and delays, as well as problems with the current connection process to Xcel. While the problems have been surmounting, only a handful of developers decided to file a formal complaint against the power company with regulators. But some do have concerns over the future of the Minnesota programs and feel all of the problems will become worse as the queue of applications grows.
Xcel Energy was with the state of Minnesota almost immediately after legislation was passed to allow cost-saving community solar programs to be constructed. Xcel has been developing installations since 2013 and currently boasts of a portfolio of just over 510 programs in its queue. Should the utility company be able to move forward with the applications, estimates show that it will add an additional 483-megawatts of solar energy capacity to its grid.
Xcel’s current available substations are all almost at full capacity. However, the utility company continues to see new proposals that it may or may not have the ability to host. Recent reports of slow and sluggish response times have caused Xcel’s queue to get backed up. The company is also facing delays in engineering studies and has imposed costs to its approval process that developers were not expecting to face. Despite these issues, Xcel has been working with developers to prevent formal complaints and has resolved many through informal interactions.
Sunrise Energy Ventures CEO Dean Leischow is one developer that Xcel has been unable to appease. After being unable to rectify issues with Xcel directly, Leischow hired attorney Curtis Zaun to start filing formal complaints. Zaun will also represent Leischow and Sunrise Energy Ventures in front of regulators. According to Zaun, Xcel is showing patterns of fault, specifically when it comes to delivering timely interconnection studies. Another company represented by Zaun, SunShare LLC, is said to have nearly a dozen projects in the pipeline that have been delayed due to interconnection dilemmas. SunShare’s CEO, David Amster-Olszewski, also believes his company has pinpointed errors in studies received from Xcel.
Developers aren’t the only ones finding issues with the approval of community solar programs. Minnesota Solar Energy Industries Association executive director David Shaffer noted that Xcel’s problems stem from the continued growth of community solar and the applications filtering in. Shaffer has pinpointed several issues with the interconnection process, confirming that these problems, which were first noted in 2019, have served as a block for quick approvals from Xcel.
While facing backlash from the community and developers, the community solar program utility provider has remained vocal in defending itself. According to the provider, the gardens that were operational in 2020 were first submitted in 2018. This, Xcel states, is well within the interconnection timeline. It also noted that it has collected nearly $1 million associated with late fees from developers that were beyond their deadline for completion. What’s important to note is that Xcel is a proponent of moving away from the community solar program model. Each year, the utility company requests that legislatures cease the use of the community solar program model because it’s not beneficial to homeowners and residential participants. Xcel believes the cost to ratepayers isn’t worth it, and commercial parties are seeing the bulk of the return so far.
During a recent legislative session, advocates of solar energy have provided alternatives that will directly benefit Xcel energy. One possibility on the table is increasing the solar capacity from 1-megawatt to 3-megawatts. This is expected to result in larger programs a less competition. Another proposal involves removing geographic restrictions as it pertains to where subscribers must live. Typically, a subscriber has to be within a certain county or neighborhood, and the land the development is built on must meet certain solar restrictions. The hope is that more rural subscribers will have the opportunity to participate in the community solar program.
Along with seeing an improvement in Xcel’s speed and efficiency, developers are requesting “batch “ studies. These reports provide an idea of the impact on the grid as ii affects project clusters. Staff at Xcel Energy confirm that the company is working to meet the needs of all community solar developers, which includes tweaking the interconnection process.