Commercial PACE Financing for Solar in Minnesota

← All financing options · Last reviewed October 2026

What commercial PACE is

PACE (Property Assessed Clean Energy) lets a property owner finance energy improvements, including solar, and repay the cost through a special assessment on the property tax bill instead of a conventional loan. Minnesota authorizes it in Minn. Stat. 216C.435–216C.436. Cities and counties opt in, then an administrator runs the program.

The assessment is tied to the property, not the owner. MinnPACE lists several reasons owners use it: no personal guarantee, up to 100% financing, a fixed rate, and payments that can transfer to a buyer or be shared with tenants. For a business that wants solar without tying up cash, it's one of the more flexible tools available.

Who administers PACE in Minnesota

• MinnPACE is a division of the Saint Paul Port Authority and calls itself the largest PACE provider in Minnesota. It works statewide with participating counties and cities, and it can help a county that isn't enrolled yet get set up.
• Rural Minnesota Energy Board PACE serves businesses and nonprofits in its member counties in southwest Minnesota. The Southwest Regional Development Commission administers it.
• UMVRDC PACE Revolving Loan Fund serves commercial owners in Big Stone, Chippewa, Lac qui Parle, Swift and Yellow Medicine counties. It has a $5,000 minimum and may refer projects over $100,000 to another PACE lender.

Clean Energy Resource Teams (CERTs) keeps a statewide overview and can help if your county isn't covered.

MinnPACE at a glance

Source: MinnPACE PACE Loans and Eligibility, as of October 2026. Rates depend on the lender. See MinnPACE or ask us.

Smaller projects: Trillion BTU loans

The Saint Paul Port Authority also runs Trillion BTU loans for cash-flow-positive efficiency and renewable projects from $25,000 to $1,000,000, with terms up to 10 years. MinnPACE lists the rate as set quarterly. As of October 2026, its page showed 5.5% through September 30, 2026, so check the current quarter. These loans cover retrofits but not new construction. They also carry prevailing-wage reporting, historic preservation and environmental review requirements, and can be paid monthly or structured through PACE.

PACE and the federal tax credit

PACE changes how you pay, not who owns the system. A business that owns its solar may still be able to claim the §48E investment credit and depreciation, which can then go toward paying down the assessment. Timing is the catch: projects that begin construction after July 4, 2026 must be placed in service by December 31, 2027. Read our §48E deadline explainer and confirm eligibility with your tax advisor. Because PACE requires a study, lender consent and county paperwork, start early.

How it works with iSolar

1. Feasibility and production model. We size the array from your interval data or bills and model production, savings and payback. Our commercial solar ROI tool gives a first look.
2. Eligibility check. Confirm your county participates and run MinnPACE's eligibility quiz. We'll help you gather the details.
3. Contractor bid. We provide a licensed, itemized bid that meets PACE requirements, so lenders and the administrator can review the scope.
4. Energy study. PACE requires an energy audit or renewable energy feasibility study from a qualified professional. We'll coordinate the solar portion and work with your auditor.
5. Lender consent and appraisal. You get mortgage-holder sign-off on the Lender Acknowledgement Form, and an appraisal if one is needed.
6. Choose a PACE lender and close. Pick a lender, finalize terms and close the assessment.
7. Build. We install on our commercial schedule (20% / 70% / 95% / 5% at PTO), with draws coordinated with your PACE funding.

Who it's best for, and who it isn't

Best for

• Building owners who want little or no money down and payments spread over decades
• Owners who may sell, since the assessment can transfer with the property
• Landlords who can pass part of the cost to tenants who benefit
• Farms, nonprofits and churches with property-tax-paying parcels. See our nonprofit solar guide.

Not ideal for

• Single-family homes. Minnesota's PACE programs list commercial, multifamily and similar property types.
• Properties whose mortgage lender won't consent
• Very small projects where closing, study and appraisal costs outweigh the benefit. A Trillion BTU loan or a commercial solar loan may be simpler.
• Government-owned property that doesn't pay property taxes

Talk through PACE for your building

We'll model cash, loan and PACE side by side so you can see which one pencils for your building. Start on our commercial solar page or request a free assessment.

Sources

• MinnPACE — PACE Loans
• MinnPACE — Eligibility Checklist
• MinnPACE — Trillion BTU Loans
• Saint Paul Port Authority — MinnPACE
• Clean Energy Resource Teams — PACE in Minnesota
• UMVRDC — Property Assessed Clean Energy Revolving Loan Fund
• Minnesota Revisor of Statutes — Minn. Stat. 216C.436 (PACE)

iSolar is not a lender. Loan approval, rates and terms are set by the lender. Information current as of October 2026; confirm details with the lender.