Renewable / Solar Energy
Renewable energy development has become an important part of utility generation planning across the country and Montana-Dakota is committed to exploring future development in renewable energy sources, along with more traditional sources of energy generation. Currently, Montana-Dakota provides renewable energy generation to its customers through its investment in wind and waste heat recovery generation. Today Montana-Dakota supplies approximately 20% of its customer’s electric energy requirements from renewable sources of generation. Recently, solar energy has been moving to the forefront of discussion and Montana-Dakota has been closely monitoring solar technology development and the potential to invest in community solar/utility grade solar generation. The following is a list of frequently asked questions to help guide you if you are considering investing in solar generation or would like to learn more about it:
Solar systems work by utilizing a series of solar panels, which use photovoltaic (PV) cells to convert energy from the sun into DC electricity. Through an inverter, this is then transformed into AC electricity, that can be utilized by your home or business.
Montana-Dakota has performed analysis based on our average residential electric customer in each state within our electric service territory. Based on this analysis a 5,000 watt (5 kW) roof mounted solar system is the most commonly sized system within our service area.
Montana-Dakota’s market research shows that that the average cost of a solar system is $2.86/Watt-installed, which again assuming a 5,000-Watt system for a total cost for the average sized system of approximately $14,300.
On all projects installed after Jan 1, 2023, there is a 30% federal tax credit available and assuming a customer can take the full tax credit the net investment is approximately $10,010. A guide to the federal tax credit can be found as follows. Homeowner’s Guide to the Federal Tax Credit for Solar Photovoltaics | Department of Energy
A summary of our current electric rates for each state can be found on the following link: Montana-Dakota Rate Summary File.pdf (mduresources.com)
In North Dakota and South Dakota, any amount that is in excess of a customer’s usage in a monthly billing period will be net billed at Montana-Dakota’s currently effective avoided cost rate, which is $0.0269/kWh.
In Montana and Wyoming, our solar customers utilize “Net Metering”. If the energy supplied by the solar system exceeds the amount of energy supplied by the MDU for that billing period, the net kWh shall be credited to the customer’s next monthly bill. The balance of the energy generated shall appear as a credit on the customer’s account until the customer’s consumption offsets the credit or the end of the designated 12-month billing period, whichever occurs first.
The table below summarizes these systems based off average size of the system and the expected system performance due to geographic location, and cost of electricity.
|Average Residential Customer Usage (kWh)||Annual Solar System Generation (kWh)||Annual Amount Over-Generated||Total Annual Customer Savings||Simple Payback After Tax Credit ($10,010 investment)|
What is solar energy?
Solar energy technologies often have higher upfront costs, and the price per kWh of solar is higher than the cost of utility-scale electricity generated in Montana-Dakota’s service area. Capacity factors also tend to be low, which means energy is only produced when the sun shines rather than around the clock.
How much energy can a solar system generate?
Advancements in technology make this a difficult question to answer, but a good rule of thumb is 8-10 watts per square foot of solar panels under direct sunlight. Over the last few years mainstream solar has increased in efficiency from 18.4% to 21%. This efficiency level is measured under the ideal conditions of direct sunlight; cloud cover and angle of the sun will decrease solar efficiency.
Should I consider the use of rooftop solar?
Montana-Dakota is committed to making long-term economic decisions to keep the cost of energy low for all of our customers and renewable energy is an important part of Montana-Dakota’s portfolio. Due to economies of scale driving down installation costs, maintenance, and material costs, Montana-Dakota continues to evaluate the ability to add cost competitive utility-scale solar and community solar gardens.
What steps should I take if I plan on integrating rooftop solar?
If you are considering investing in and installing a rooftop solar system contact Montana-Dakota at 800-638-3278. We can help you to understand the interconnection and safety requirements you must meet before you proceed. In addition, you will need to check with your local building inspections department regarding any local ordinances and permits required for rooftop solar.
What is net metering?
Net metering is a billing mechanism that nets consumption against generation. When generation is more than consumption it provides customers with the ability to carry over excess generation to the next month’s bill and/or sell excess electricity generated by their solar systems back to the utility.
Where can I find additional information about net metering?
Can customers who generate their own energy also rely on electricity from Montana-Dakota some of the time, for example, when their generation is not operating?
Yes. Customers will be charged their applicable rate as a Montana-Dakota customer.
What is an interconnection agreement, and do I need one for solar generation?
These requirements are necessary to protect your home, the grid and the company’s power line workers.
It is essential to contact the Montana-Dakota before beginning your solar generation project by calling 800-638-3278. If you have installed or plan to install grid connected solar generation you are required to notify Montana-Dakota and execute an interconnection agreement.
Are there state or federal incentives or tax credits available for solar generation investments?
The Database of State Incentives for Renewables & Efficiency (www.dsireusa.org) is one source of information regarding state and federal incentives, tax credits and policies that support renewables and energy efficiency in the United States. The site features an interactive map, which allows users to click on a state to see a comprehensive listing of federal and state incentives, credits, exemptions, grants, loans and rebates for residential and commercial/industrial projects and programs.
Does Montana-Dakota offer rebates, incentives, or grants for rooftop solar generation?
Montana-Dakota does not offer incentives or grants for renewable or rooftop solar energy systems. State and federal incentives may be available depending on your project and location.
What is a community solar garden?
A community solar garden (CSG) is designed to use economies of scale to drive down one of the main barriers of entry for solar – high upfront costs – by using a series of concurrently sited solar panels designed to generate up to several megawatts of energy for use by the community and divided into customer sized blocks of energy. Under a typical CSG program, customers can purchase panels, lease blocks, or purchase solar energy to meet all or part of their energy needs without having to install a system on their own home.
Is Montana-Dakota currently offering community solar options to its customers?
Engagement in community solar will depend on many factors, including the availability of best-cost solar resources, customer interest, and customer willingness to pay incrementally higher energy prices for solar energy.
Can I participate in the survey?
We will be sending the customer survey to a random sample of residential and commercial Montana-Dakota electric customers in the states of Montana, North Dakota and South Dakota.
Why hasn’t Montana-Dakota built solar yet?
Please contact us at 800-638-3278 if you would like to learn more about solar energy initiatives.