Solar Hot Water Rebate Program

January 03, 2012


The Minnesota Office of Energy Security (OES) offers rebates for in-state single family residential, multi-family residential and small business solar hot water heating systems designed primarily to provide domestic hot water. "Small businesses" are defined as having 20 or fewer full-time equivalent (FTE) employees. The rebates are available for new systems only; repairs of inoperable systems are not eligible for incentives under the current program rules. Systems that combine solar space heating with solar water heating are eligible for the program, but only the portion of the system devoted to solar water heating is eligible for a rebate. Systems that integrate solar water heating into a hot tub or pool are not eligible. Separate program applications exist for residential and small business solar water heating rebates.

Rebate Structure
The general rebate level is set at $25 per square foot of net aperture, as measured by the Solar Rating and Certification Corporation (SRCC). Below is a listing of the limitations set on each category of rebate:

  • Single Family Residential: lesser of 25% of system cost or $2,000
  • Multi-Family Residential (2-3 units): lesser of 25% of system cost or $4,000
  • Small Businesses and Qualifying Multi-Family Residential (4+ units): lesser of 25% of system cost or $25,000

Rebate amounts may not exceed the total cost of the system minus federal, utility, or other incentives.

The Minnesota Solar Thermal Rebate program has numerous equipment, warranty, and installation requirements for rebated systems. Pre-assembled SRCC OG-300 certified systems may be installed as received from the manufacturer in lieu of the system requirements for those components. All systems must be installed by a contractor with at least $50,000 in liability insurance working with a licensed plumber; self-installed systems are not eligible under this program. The OES has the right to inspect and monitor systems to make sure they meet rebate guidelines. In addition, the OES may monitor on-site energy use before and after system installation in order to evaluate program energy savings.

The program will cease accepting applications when funding is exhausted. Participants must complete several preliminary steps before applying for a rebate. The application must be approved prior to any installation work in order to remain eligible for a rebate and systems must be installed within nine months of the receipt of rebate confirmation. It is important to note that because the current program is funded by the American Recovery and Reinvestment Act (ARRA), participants may be subject to additional terms and conditions governing the use of ARRA funds. The program website and application contain step-by-step instructions on how residents should proceed with installing a rebated system under the program rules.

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: Minnesota
Incentive Type: Rebate Program
Web Site:
Administrator: Minnesota Department of Commerce
Start Date:
Eligible Renewable/Other Technologies:
  • Solar Water Heat
Incentive Amount: $25 per square foot of net aperture
Maximum Incentive: Single Family: lesser of 25% or $2,000
Multi-Family (2-3 units): lesser of 25% or $4,000
Multi-Family (4+ units): lesser of 25% or $25,000
Small Business: lesser of 25% or $25,000
Eligible System Size: Not specified, but rebates are limited
Equipment Requirements: Collectors must be SRCC OG-100 rated and have a five-year warranty; other components must have a one-year warranty and the systems (repaired or new) must have a two-year installation warranty; flat-plate collectors must have tempered glass glazing; other technical requirements exist for some components and configurations.
Installation Requirements: Installer must work with a licensed plumber; systems must have a back-up water heating system and outfitted for efficient operation (e.g., well-insulated); collectors must be mounted at an angle of at least 35 - 60 degrees from horizontal, securely fastened to the mounting structure, and 80% shade free.
Ownership of Renewable Energy Credits: Remains with project owner


Name: Energy Information Center
Organization: Minnesota Department of Commerce
Address: 85 7th Place East
St. Paul MN 55101-2198
Phone: (800) 657-3710

This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.