Minnesota is committed to the gradual but steady growth of clean energy, as codified in the Carbon-Free Electricity Standard of 2023, which requires 100-percent carbon-free electricity by 2040. The state largely leaves it up to the utilities and other private sector players to determine how to achieve these goals. In the last three years, Minnesota has benefitted from President Joe Biden’s 2022 Inflation Reduction Act (IRA), which offered tax breaks and rebates to businesses and households that installed equipment leading to greenhouse gas reductions.

According to the state Department of Commerce, since passage of the Inflation Reduction Act, Minnesota has seen:

• $2.4 billion in clean energy and manufacturing investments
• Nearly 2,500 new permanent operational jobs and 4,800 construction jobs
• 135 new clean energy facilities launched
• 7 new facilities now manufacturing Minnesota-made energy conservation products

That kind of growth could have continued for ten years if Trump had not interrupted it by pausing spending under the IRA on his first day in office. According to a report by RMI (formerly the Rocky Mountain Institute), “[The IRA] is the partnership between the private sector and policy that we need to drive forward ambitious climate action this decade.” 

Generous government subsidies encouraged the private sector to invest in novel technologies like carbon capture and energy storage. The scale of government commitment encouraged industrial expansion and opened a way for the U.S. to compete with China in various technologies needed for the energy transition.

Many people were excited about the changes that could happen with this kind of support. Climate activists, non-profit organizations, and young clean-energy businesses were given tools that could help them speed the move to non-polluting energy.

But Trump’s “One Big Beautiful Bill,” passed in 2025, and various other Trump policies have quashed the promise of the IRA. Tax credits have been eliminated for purchase of electric cars, energy-efficient home improvements, and solar electric panels, wind turbines, and batteries. Some observers hope court rulings and Congressional pressure will bring some of these tools back. Several studies have shown the benefits of the IRA were flowing primarily to Republican states and districts. One 2024 study reports that “nearly 60% of the announced projects — representing 85% of the investments and 68% of the jobs — are in Republican congressional districts. This despite the fact that no Republican voted for the legislation.”

Meanwhile, what has been happening on the ground? Where can homeowners get help to install solar panels or boost their insulation? How will clean energy businesses survive a slump in sales? How will the loss of robust support affect Minnesota’s clean energy goals?

The world of energy conservation and clean energy is not a total desert. Several sources of help for Minnesotans are still available.

Community Action Programs

Community Action Programs across the state and country are old hands at this work. They got their start in the mid-1960s as part of President Johnson’s War on Poverty. In Minnesota, 24 Community Action Agencies serve all 87 counties across the state, and tribal governments have similar programs. For example, in northeastern Minnesota, the Arrowhead Economic Opportunity Agency offers these services to homeowners and renters in Lake, Cook or St. Louis Counties who are at or below 200% of federal poverty guidelines, ($33,000 annually for a single person and $36,000 annually for a family of four):

• Education on energy issues
• Energy Audits to evaluate home energy use
• Exterior wall and attic insulation
• Building envelope sealing
• Test, repair, and/or replace home heating systems to ensure efficiency and safety

Across the entire state, CAP programs in 2024 helped 33,256 households improve energy efficiency and reduced energy burden.

But, like all government programs, CAP programs have limited resources. Dave Johnson, director of housing for Arrowhead Economic Opportunity Agency, says after a substantial hit in funding in 2025, this year’s allocation is $2.8 million. That will take care of 86 houses. Currently there are two hundred homes on a waiting list.

Solar United Neighbors

Solar United Neighbors (SUN) is a national non-profit dedicated to helping families, businesses, and other non-profit organizations install solar panels to save money and reduce carbon emissions. Typically, they arrange group buys to achieve lower prices and provide useful up-front information to potential buyers. (Full disclosure: two years ago, my husband and I participated in a group buy. Our system basically pays for all of our non-heat-related electricity usage (the heating is separate), provided my husband clears the panels often in the winter!

The group’s Minnesota director, Bobby King, says he expects the loss of IRA funding will result in fewer homeowners installing panels this year than in recent years, “which is too bad, because we need all the renewables we can get on the grid right now. Use of electricity is going up for the first time in a long time, with people shifting to electric appliances and buying electric cars, and now with the data centers,” King says.

There are still rebates available from most electric companies.

Otter Tail Power Residential rebate and enrollment forms | Otter Tail Power Company

Xcel Energy Home Rebates | Residential Services | Xcel Energy

Minnesota Power Residential Rebates & Services – Minnesota Power is an ALLETE Company

Local non-profits

Ecolibrium 3 is a non-profit that works to revitalize a low-income neighborhood in Duluth and promotes energy transition, housing stock improvement, economic security, and health. When I reached executive director Jodi Slick, she was working on two grant requests that were both due that afternoon. Confessing that she had a touch of “pressure in my chest,” she described the sadness she felt over the loss of $150 million of federal dollars earmarked for Minnesota that could have provided up to $14,000 per household to do the kind of work ECO3 has been doing for 20 years, weatherization and electrification.

ECO 3 is creative about meeting multiple needs with the same dollar. The non-profit had a half-million-dollar grant to run an AmeriCorps program to teach skills such as energy auditing, weatherization installation, and navigation of resources to help pay for home efficiency projects. The grant was terminated in April 2025 but brought back in June. Slick was planning to use IRA money as a match for that project. “We’re still kind of piecing and parsing things together and—knock on wood—Minnesota has been waiting for final approval of HOMES (the federal Home Efficiency Rebate program) and HEAR (for low- and middle- income households), which would help low-income and all Minnesotans,” she says.

HOMES was designed to provide rebates for whole-home energy saving improvements. Payments were to come through state agencies. Several states quickly set up offices to handle the money, but Minnesota’s Department of Commerce went through a time-consuming process to gather public input and had not set up a structure for its Save Energy Minnesota program by the first day of the second Trump administration. That’s when the order went out directing federal agencies to pause disbursements of certain funds under the IRA and the Infrastructure Investment and Jobs Act (IIJA, also known as the Bipartisan Infrastructure Act). The Minnesota Commerce Department website reports:

“Current update (2/2/2026): Save Energy Minnesota has not launched yet. Minnesota is waiting for formal approval from US Department of Energy to launch the program. There is no estimated program launch date.”

The same notice “updates” the HEAR program.

The first step for any energy efficiency work is a home energy audit, a detailed study of where the home is losing heat and recommendations on which types of investments will provide the best return. When ECO 3’s workers conduct these energy audits, they still provide a list of possible funding sources, including utility loans and help from the Duluth Housing and Redevelopment Authority. Sometimes ECO 3 staffers do the weatherizing work. “We continue to do what we were doing but we know a big opportunity has been whittled away,” says Slick.

Turning to state and private sources of funding is not always useful, according to Slick. Often state sources depend on federal money as part of their pool, meaning there’s less for the state to give out. All sectors of public life are facing pressure from the loss of federal and state funds. And the state itself is facing reduced federal funding, which challenges their own operations, Slick says.

Foundations are facing huge needs, and with the recent chaos in Minneapolis and St. Paul, foundations have been redirecting some of their work to meet those priorities. “The pies are only so big, so when we rightfully have to use philanthropic dollars to respond to the emergency of the day, there aren’t necessarily resources to fill in other gaps,” she says.

Behind the scenes

Meanwhile, there are several non-profit organizations doing background work to support the energy transition. The Center for Energy and the Environment (CEE) implements residential, commercial, and community programs and does technical research and policy analysis to advance clean energy and improve the economy.

Its work on improving building codes was disrupted when Trump cut funding for the IIJA. “We lost about six million dollars,” says Angela Peterson, who leads the Building Codes Advancement effort at CEE. One of the projects they expected the federal money to pay for was the development of digital tools to help local government officials check new buildings for code compliance. “There are so many things to remember, no one can keep them all straight,” Peterson says, “We were designing digital tools to support their work, and we also were prepared to help cities review plans for complicated buildings. We wanted to help them deal with meeting codes up front.”

Peterson and her staff pivoted to a different source of funding, from the state. The Minnesota Energy Conservation and Optimization program, dating back to 1983, requires utilities to contribute to a fund to help households and businesses optimize their energy use. Peterson says now CEE is working to strengthen new codes and ensure any potential changes are technically sound and market ready. Peterson’s staff is exploring basic questions about newer codes: what they are likely to call for, whether there are materials to meet the new standards, whether the workforce is educated in how to use them.

“We’re scrappy; we’re going to figure things out, but it hurts to lose that kind of funding,” Peterson says.

Another CEE project concentrates on air-source heat pumps. Similar to a refrigerator, a heat pump is an energy-efficient device that transfers heat from one place to another to provide heating or cooling, rather than generating heat directly. Without the IRA-funded incentives they had planned on to bring down upfront costs, they’re coming up with other ways to reach potential adopters. Program lead Maggie Pears talked with me after attending a builders’ breakfast where utilities educate contractors on specific products each utility approves for rebates, including heat pumps. One of her jobs is to try to move the utilities closer to each other on items qualifying for rebates. More uniformity will help contractors, she says: “They can become familiar with a smaller number of products, and even possibly have them in stock, ready to install.” She says the utilities have been willing to move closer together.

Meanwhile, CEE is using money from investor-owned utilities to launch a new cooperative advertising program.

“This year might be a little slower for contractors selling heat pumps, so we started a program to help with costs on the business side,” Pears says. “We can help cover the costs of marketing. Air-source heat pump distributors and manufacturers already do it, but ours is brand-agnostic. They can stack it with a manufacturer or distributor program and maybe get advertising for free.”

Both programs are initiatives of the Efficient Technology Accelerator, a statewide program led by CEE that accelerates deployment and reduces the cost of emerging and innovative efficient technologies.

“It’s one of the ways we’re trying to incentivize contractors to be champions of air-source heat pump technologies; they make a huge difference in persuading buyers,” Pears says.

The little engine that couldn’t quite

The transition away from fossil fuels is a huge challenge. Climate change is already well under way; natural disasters are occurring more often and with more devastating impact. The loss of the over-arching commitment and support embodies in the IRA and the IIJA only adds to the already-existing barriers. As one example, let’s look at what happened in Grand Marais, the county seat of Cook County in far northeastern Minnesota. The town has just over a thousand residents, and the moose population in the region is four times that amount. But those human residents are more than usually active. They formed the Cook County Local Energy Project (CCLEP) in 2009. Volunteers and experts conducted a comprehensive analysis of energy systems in the far northeastern county, including transportation, heating and cooling, and an inventory of local resources. Building on that knowledge, the group ambitiously envisioned a biomass plant in Grand Marais that could provide electricity and steam heat for downtown. Ultimately that idea didn’t promise financial sustainability. The group also considered a potential wind project at the eastern end of the county, but concerns about possible impacts on wildlife preserves prevented its construction. For several years they have taken on the responsibility to conduct subsidized energy audits, using volunteers and money from small foundation grants.

When the IRA passed in 2022, CCLEP jumped on board, dedicating itself to advising residents on how to use the subsidies for home and business energy projects. One of the leaders of the group, Chris O’Brien, retired to Grand Marais after a career in energy and alternative technologies. In the last few years, the group has tried to expand and professionalize, but the last executive director left in early 2024. “We couldn’t pay her what she deserved,” says O’Brien. “It’s near impossible to make a living that can pay for housing in Cook County.”

O’Brien regrets the Trump administration’s decision to cancel the IRA. “It was a whole suite of programs that made it much easier for folks to make plans to upgrade the performance of their homes.” But O’Brien believes the economics of clean energy guarantee that it will continue to grow. “The growth of renewables is being driven by economics, not policy,” he says. “It’s very shortsighted of the federal government to attack the promising opportunities embedded in clean energy.”

O’Brien served as CCLEP’s interim executive director for a couple of years, keeping up with education programs, an annual tour of clean energy sites, and training for builders. But ultimately the CCLEP board decided it couldn’t sustain a stand-alone organization, and in January 2026 it dissolved, folding its assets into another local group it had cooperated with over the years, Cook County Higher Education. O’Brien expects that group will continue many energy-saving projects.

He also predicts there will be more pressure on the state to provide support for communities to make the transition. Minnesota law requiring that all utilities operate carbon-free by 2040 “provides state agencies and utilities with the justification they need to continue to press forward,” says O’Brien.

It may be that 2026 becomes a year when Minnesotans stumble in their quest to use clean energy, but the work will continue. And the costs and impacts of a fossil-fuel-dominated energy economy will continue to rise whether we acknowledge them or not.