MN Energy Smart

Financial Incentives

Minnesota businesses have access to a wide range of financial incentives to help pay for energy efficiency upgrades. Here’s a look at what financial incentives are available. Feel free to give us a call at (651) 292-3902 if you have any questions about incentives, eligibility or how to pursue them.

A good place to start looking for financial incentives is the Division of Energy Resources at the Minnesota Department of Commerce.  See the links below.

Minnesota Department of Commerce, Division of Energy Resources

List of funding opportunities by deadline
TIP:  Click “open” in the upper right hand corner of the page, type energy efficiency in the search
List of other web sites that post funding opportunities

Utility Rebates

Many electric and gas utilities serving Minnesota offer rebates to commercial customers making common energy improvements, such as installing energy-efficient lights, heating and cooling systems, and motors, as well as sometimes custom improvements. Details of the rebate programs vary widely, but the rebates can be worth 40% or more of the improvement project’s cost.

Below are some useful links about current rebate programs offered by utilities serving Minnesota. For utilities not listed, use our Utility Rebate Finder.

Xcel Energy Rebates

Connexus Energy Rebates

Property Assessed Clean Energy (PACE)

PACE or Property Assessed Clean Energy, is a local government initiative that allows property owners to finance energy efficiency and renewable energy projects. Interested commercial property owners opt-in to receive financing for improvements. Financing is repaid through an assessment on property taxes. Currently, the City of Edina is the only local government entity in Minnesota which has a commercial PACE program in place. Energy Smart and several partners are working to make commercial PACE a reality in other communities throughout the state.

Grant and Government Incentive Opportunities

Many entities around Minnesota offer grant opportunities for businesses making energy-efficiency improvements. Some programs are short-term and have a specific deadline, while others are ongoing. Some are offered by a local government or the state, while others are available through non-profit organizations, economic development groups or utilities. You can stay up-to-date on government-funded grant opportunities on the Minnesota Division of Energy Resources Web site, or by signing up to receive updates by e-mail.

Here’s a look at some current grant and government-based opportunities:

Minneapolis Great Street Facade Improvement Program

For building owners & business owners located in the following areas of Minneapolis:

  • On Excelsior Blvd., from 32nd St. to Lake St.
  • On Lagoon Ave., from Humbolt Ave. to Dupont Ave.
  • On Lake St., from Pillsbury Ave. to Mississippi River
  • On West Lake St., from Excelsior Blvd. to Pillsbury Ave.
  • Matching grants up to $5,000 for qualified facade improvements (i.e. energy efficient windows, outdoor lighting, etc.

The Duluth Superior Area Community Foundation

  • 501(c)3 organizations in the seven counties of northeast Minnesota
  • Fund for the Environment: reflects growing community concern and awareness of our interdependence with our environment.

Utility grants

Some utilities also offer grants for commercial customers performing energy-efficiency improvements. For example, Minnesota Power’s Power of One conservation program awards grants to commercial / industrial / agricultural customers who use innovative technologies, improve manufacturing processes, undertake renewable electric energy projects. Power of One amounts are based on kilowatt hours saved. For more information on grant programs offered by your utility, use our Utility Rebate Finder.

Low-Interest Loans

Some utilities and other organizations offer standard and reduced-rate loans. For example, Otter Tail Power’s DollarSmart financing program provides low 2.9% interest loans in lieu of rebates; they also offer standard 7.9% interest rate loans. Any loan programs offered by a utility are applicable to customers in their service territory only. For more information on grant programs offered by your utility, use our Utility Rebate Finder.

Federal Tax Incentives

In some cases, federal tax incentives are also available for energy efficiency improvements at businesses. Extended through 2013, this incentive is called The Energy Efficient Commercial Building Tax Deduction.