SF 2900

Introduction - 94th Legislature (2025 - 2026)

Posted on 03/28/2025 10:00 a.m.

A bill for an act
relating to energy; establishing a geothermal heat exchange system rebate program;
appropriating money; proposing coding for new law in Minnesota Statutes, chapter
216C.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [216C.49] GEOTHERMAL HEAT EXCHANGE SYSTEM REBATE
PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For the purposes of this section, the following terms have
the meanings given.
new text end

new text begin (b) "Eligible applicant" means a person, business, nonprofit, government entity, federally
recognized Tribe in Minnesota, or religious institution that provides evidence to the
commissioner's satisfaction demonstrating the applicant has received or has applied for a
geothermal heat exchange system rebate available from the United States Department of
Treasury under the Inflation Reduction Act of 2022, Public Law 117-189, for a commercial
or multifamily building located in Minnesota.
new text end

new text begin (c) "Geothermal heat exchange system" means a heating or cooling exchange device
composed of a mechanism that collects or rejects heat from or to the underground.
new text end

new text begin Subd. 2. new text end

new text begin Establishment. new text end

new text begin A geothermal heat exchange system rebate program is
established in the department to provide financial assistance to eligible applicants that install
geothermal heat exchange technology in the applicant's building.
new text end

new text begin Subd. 3. new text end

new text begin Application. new text end

new text begin (a) An application for a rebate under this section must be made
to the commissioner on a form developed by the commissioner. The application must be
accompanied by documentation, as required by the commissioner, demonstrating:
new text end

new text begin (1) the applicant is an eligible applicant;
new text end

new text begin (2) the applicant owns the Minnesota building in which the geothermal heat exchange
system is to be installed;
new text end

new text begin (3) an energy audit of the building in which the geothermal heat exchange system is to
be installed was conducted by a person with a building analyst technician certification issued
by the Building Performance Institute, Inc., or an equivalent certification, as determined by
the commissioner, within the 18 months preceding the application date;
new text end

new text begin (4) the applicant installed a geothermal heat exchange system with the capacity
recommended by the auditor or contractor, and the heat pump was installed by a contractor
with sufficient training and experience in installing heat pumps, as determined by the
commissioner; and
new text end

new text begin (5) the total cost to install the geothermal heat exchange system in the applicant's building
and the associated geothermal loop installed and located outside of the building.
new text end

new text begin (b) The commissioner must develop administrative procedures governing the application
and rebate award processes.
new text end

new text begin (c) The commissioner may modify program requirements under this section when
necessary to align with comparable federal programs administered by the department under
the Inflation Reduction Act of 2022, Public Law 117-189.
new text end

new text begin Subd. 4. new text end

new text begin Rebate amount. new text end

new text begin A rebate awarded under this section must not exceed the lesser
of:
new text end

new text begin (1) 15 percent of geothermal heat exchange system costs, not to exceed $100,000 for a
single project; or
new text end

new text begin (2) the total cost to purchase and install the heat exchange system in an eligible applicant's
building, net of financial support received for the system from other federal, state, or utility
programs.
new text end

new text begin Subd. 5. new text end

new text begin Prioritization. new text end

new text begin When evaluating applications under this section, the
commissioner must give priority to applications for multifamily housing or commercial
buildings that:
new text end

new text begin (1) are owned by a nonprofit or government entity; and
new text end

new text begin (2) meet the definition of low-income rental property under section 273.128.
new text end

new text begin Subd. 6. new text end

new text begin Account established. new text end

new text begin (a) A geothermal heat exchange system rebate account
is established as a separate account in the special revenue fund in the state treasury. The
commissioner must credit appropriations and transfers to the account. Earnings, including
interest, dividends, and any other earnings arising from assets of the account, must be
credited to the account. Money remaining in the account at the end of a fiscal year does not
cancel and remains in the account until expended. The commissioner must manage the
account.
new text end

new text begin (b) Money in the account is appropriated to the commissioner to award rebates under
this section and to reimburse the reasonable costs incurred by the department to administer
this section. Money remaining in the account on January 1, 2033, cancels to the renewable
development account.
new text end

Sec. 2. new text begin APPROPRIATIONS.
new text end

new text begin (a) Notwithstanding Minnesota Statutes, section 116C.779, subdivision 1, paragraph (j),
$....... in fiscal year 2026 is appropriated from the renewable development account under
Minnesota Statutes, section 116C.779, subdivision 1, to the commissioner of commerce for
the geothermal heat exchange system rebate program under Minnesota Statutes, section
216C.49. A rebate awarded with money appropriated under this paragraph must be awarded
only to projects that are located within the electric service area of the public utility subject
to Minnesota Statutes, section 116C.779.
new text end

new text begin (b) $....... in fiscal year 2026 is appropriated from the general fund to the commissioner
of commerce for the geothermal heat exchange system rebate program under Minnesota
Statutes, section 216C.49. A rebate awarded with money appropriated under this paragraph
must be awarded only to projects that are located outside the electric service area of the
public utility subject to Minnesota Statutes, section 116C.779.
new text end