solar panels in sunlight

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

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-GeneratedTotal Annual Customer SavingsSimple Payback After Tax Credit ($10,010 investment)
ND9,9255,848200.5$573.9917.4 years
SD10,7805,8469.6$683.6114.6 years
MT9,4676,1630$704.4614.2 years
WY10,4646,5660$540.2918.5 years

Solar photovoltaic energy is power that can be harnessed from the sun and converted into electricity. Solar energy systems do not burn traditional fossil fuels and do not produce emissions or greenhouse gases.

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.

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.

It depends on your needs, goals and budget. Since Montana-Dakota’s generation portfolio is already 20% renewable energy, thanks to the use of utility-scale wind, customers already have access to energy produced from a sustainable source, without the added expense of self-generation.

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.

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.

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.

Net metering policies are applicable in Montana and Wyoming. Montana-Dakota’s existing policies, tariffs, and interconnection agreements are available online at our?Rates and Tariffs?page.

Yes. Customers will be charged their applicable rate as a Montana-Dakota customer.

An interconnection agreement informs Montana-Dakota of your intent to install a solar generation unit at your premise and connect the unit to the grid. It specifies the location, size, cost, manner of payment, terms of operation and respective responsibilities of the utility and the distributed generation facility owner, and ensures that equipment is installed safely and according to all applicable codes and standards.

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.

The Database of State Incentives for Renewables & Efficiency ( 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.

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.

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.

Montana-Dakota does not currently have a community solar program; we are in the process of conducting research into the viability of offering our customers community solar in the future. This includes a full examination of associated costs, as well as a survey to better gauge our customer’s level of interest.

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.

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.

There are various barriers to entry for utility based solar energy: technologies have high upfront costs and the energy price of solar is higher than the energy price for other types of generation such as coal, natural gas, and wind that are presently generated in Montana-Dakota’s service area. Capacity factors are low and Montana-Dakota’s system peak does not correlate well with peak solar efficiency.

Please contact us at?800-638-3278?if you would like to learn more about solar energy initiatives.