Resources for Tax-Exempt Minnesota Entities
Tax-exempt and governmental entities can now receive a payment equal to the full value of tax credits for qualifying clean energy projects. This is known as Elective (or Direct) Pay. Eligible entities can file to receive tax credits that can cover 30-70% of a projects’ cost without paying taxes! Eligible entities include:
- States and local governments, other instrumentalities (public schools, libraries)
- Municipally-owned utilities
- Rural electric co-ops
- Indian tribal governments
- CBOs, nonprofits, religious institutions, other tax-exempt entities
- Territories, agencies, & instrumentalities
Find out more by accessing the resource guide with trainings and information to determine if your organization's clean energy project is eligible.
Filing Assistance for 2024 & 2025 Projects – Submission Deadline is May 15
The Minnesota Departments of Administration and Management and Budget (MMB) are coordinating with MN Commerce to deploy a contract with Deloitte to provide 1-on-1 technical assistance for MN entities that are filing for Direct Pay tax credits for projects that were completed in 2024 & are planned for completion in 2025. This assistance is provided at no cost to eligible organizations based in Minnesota to help file or request an extension by the submission deadline of May 15 (5/15/25 for 2024 projects, 5/15/26 for 2025 projects). To request assistance, please complete this survey from Deloitte to provide information on your project.
Direct Pay-Eligible Programs from MN Commerce
As the State Energy Office, the Minnesota Department of Commerce has several programs that provide qualifying clean energy projects for tax-exempt entities like local governments, rural electric cooperatives, nonprofits, and schools. Please see below for additional information. If you have a question about Direct Pay, please complete this form.
- Solar for Schools
- Solar on Public Buildings
- Electric School Bus Program
- Air Ventilation for Schools
- Guaranteed Energy Savings Program (GESP)
- State Competitiveness Fund Matching Funds Grants (select awardees)
Direct Pay Bridge Loans from MnCIFA
A barrier to many organizations in pursuing Direct Pay-eligible projects is securing funding to begin construction of a clean energy project. Tax credit refunds can sometime take months to be processed, which can leave organizations accruing interest on traditional loans.
To address this gap, the Minnesota Climate and Innovation Finance Authority (MnCIFA) (a.k.a. Minnesota’s “green bank”) has more than $60 million available for low interest Bridge Loans from the State Competitiveness Fund (SCF) to provide coverage for Direct Pay-eligible projects. This funding helps to provide initial capital to complete a projects and 'bridges' the time until a Direct Pay refund is received with minimal expense to the awarded organization.
Only eligible for projects that cost over $250,000 and have begun construction or accruing at least 5% of total project cost on equipment or project-specific activities. Visit the MnCIFA website to learn more about their loan application process and to contact MnCIFA leadership to determine if your project is eligible.
Learn more
Find out more by accessing this resource guide with trainings and information to determine if your organization's clean energy project is eligible.