by Kim Crockett, Bill Glahn
Center of the American Experiment
May 08, 2014
In recent years, a number of local governments across Minnesota have been installing solar panels to generate a portion of their electricity. Cities and schools embrace these solar installations despite the fact that they can take 40, 50 and even 100 years to pay for themselves. Local governments are able to make these poor “investments” thanks to cash grants from the federal government and electric utilities. In this report we look at three solar power projects undertaken by local governments in Minnesota. By exploring how each city made the decision to accept cash grants, we can begin to get a picture of how uneconomic projects get funded, with each party involved making apparently rational decisions in their own best but narrow interests. In light of how these decisions were made, we offer some alternatives for city officials to consider even when they feel compelled to move forward with uneconomic projects.