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David Shaffer was hired by the Minnesota Solar Energy Industries Association in 2013 as an intern assigned to study how utilities should value solar energy.
A Vermont Law School student at the time, Shaffer figured energy law was “an up and coming legal space,” and that a developing organization just a few years old might be a good place to hone his skills.
Shaffer, 32, eventually became executive director in 2018. After years spent planning conferences, developing policies, selling memberships and representing the state’s solar industry before state regulators and legislative committees, he will leave his post in June to join a local solar company.
His time with the association coincided with major growth for the industry, with employment more than doubling since 2015 to roughly 4,000 workers, installed capacity leaping from 30 megawatts to 1,500 megawatts, and the group’s membership climbing from 30 to 125 during the same period.
Erica Forsman, president of the association’s board, said Shaffer “has played an integral role in the evolution of MnSEIA” and also “helped shape policy and regulations that have allowed the industry to thrive.”
Shaffer recently spoke with the Energy News Network about some of the changes and challenges he observed during his time with the solar group.
Q: You started at the same time the Legislature passed landmark solar legislation under Gov. Mark Dayton. How important was that?
A: It was a huge deal. A lot of the growth came about because the 2013 legislation created the community solar garden law and the carve-out for solar that required utilities to produce 1.5% of their power from solar by 2020.
That carve-out led to the construction of the North Star Solar Project — the 100 MW installation in Chisago County— and the Marshall Solar Project, which is 62 MW. Both projects would not have happened without the legislation.
Q: The community solar program is the largest in the country, with around 800 megawatts. What did Minnesota do right?
A: Many things could have gone wrong with the community solar program; it could have quickly been squashed. There was a lot of crucial regulatory work done to ensure the program did not have a practical cap on community solar garden expansion. We helped establish a fair and transparent process for determining the price Xcel Energy would pay for power from the solar gardens, allowing the program to flourish.
Q: Xcel says the community solar program costs too much. What’s the organization’s response?
A: Minnesota uses a “value of solar” method to determine the fair market value of distributed solar and that’s the law. Experts created it and the state vets the data inputs annually. It’s an honest accounting of solar’s benefits relative to burning natural gas.
Q: What about Xcel’s argument the program benefits businesses?
A: Total capacity numbers suggest the program mainly favors commercial interests. But in terms of the number of subscribers in the program, community solar gardens have been serving residential customers well. Net metering has been around since 1981, but more residential customers are subscribed to solar gardens in Xcel’s territory than there are net-metered customers in the entire state. Solar gardens have about 21,000 residential subscribers compared to around 8,000 net-metered customers.
Q: The amount of solar on commercial buildings has picked up. Why?
A: Costs for panels have come down considerably and two financing mechanisms have emerged that have been very successful. One is the Property Assessed Clean Energy (PACE) program, allowing companies to pay for projects on their property taxes. You don’t pay upfront costs and you don’t get assessed for project costs until the following May. The St. Paul Port Authority manages the program. The other is the PV demand credit.
Q: What is the PV demand credit?
A: My contribution to this program is my most significant policy accomplishment at MnSEIA. The program almost didn’t launch, but we negotiated an agreement with Xcel and the Department of Commerce, making it viable again. The credit itself is a complex mechanism to try to explain but it’s why Target and other companies have recently invested heavily in solar in Minnesota.
Q: How does Xcel’s Solar Rewards fit?
A: Solar Rewards has been a big part of selling residential solar in Minnesota because it’s a generous and necessary subsidy. This year there was $10 million for the program and it’s already gone. Now is the time to reduce the incentive amount each customer gets so more projects can be built.
Q: Utilities in some Midwest states have fought clean energy investments. How would you rate Minnesota’s utilities?
A: We would have been a lot further back if we didn’t have a good relationship with Xcel. Many of the state’s other utilities are going big time on solar, too. We have seen a sea change in how utilities see solar.
Q: What’s next for the industry?
A: The onset of utility-scale projects is the next chapter of solar in Minnesota and it’s very exciting. The first projects in a 15-year build-out should be online by the end of the year. Everyone wins with more utility-scale solar, including local workers and labor unions. The current plans would more than triple the amount of solar already in the state. With Biden’s infrastructure plans, there is even more potential.
Q: What are the challenges for the industry?
A: Equity is a big question in the solar industry. On the employment side, we need to make sure everyone who wants to work in our industry has an opportunity. We are only going to do that through more inclusivity and diversity efforts. And we need more projects serving low-income communities. I would also say the capacity constraints on the grid we’re seeing are troubling. We’ll need new policies, or it will be hard to site solar in the future.
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