Minnesotans looking to install a solar photovoltaic (PV) system have reason to be hopeful for the New Year. As we reported on this blog in June, Minneapolis-based Xcel Energy has been developing plans to introduce in Minnesota their Solar Rewards program, its solar rebate initiative already on offer in Colorado and New Mexico. If the Minnesota Public Utilities Commission (MPUC) grants final approval, rebates may become available to homeowners and businesses in 2010.

As it stands, Xcel Energy anticipates a $2.25-per-watt incentive, an amount that would deliver a one-time discount of nearly 30 percent from the estimated $8.00/watt cost of installation. Add on a 30-percent federal tax credit (or federal grant, for businesses that install a solar energy system in 2009 or 2010), and the upfront cost of installation falls further still.

John Wold, product manager for Xcel Energy’s Minnesota Solar Rewards program, noted that, though still in the planning and budgeting stage, the program has already generated a lot of interest. “We know that there’s been a lot of anticipation for this in the installer community,” said Wold. “What we would like to do is focus on the initial rush of business and keep all our customers satisfied.”

If all goes according to plan, Xcel’s Minnesota Solar Rewards program will have an annual budget of up to $4.6million to make incentive payments over three years, bringing the total sum on offer to $13.8 million.

Stay tuned with GetSolar for future details.