Residents in Duluth, MN who request quotes on the EnergySage Marketplace spend an average of $181 monthly on electricity. That adds up to $2,172 per year. A different way to look at it is that a typical Duluth, MN resident uses 1,242 kWh of electricity per month and 14,904 kWh over the year.
(For what it’s worth: Duluth, MN residents shopping for solar on EnergySage may use more electricity than a typical household.)
The easiest way to compare electricity costs across regions is to look at the electricity rate. In the U.S., residential rates generally range from 11 ¢/kWh all the way up to 34 ¢/kWh.
As of February 2026, the cost of electricity in Duluth, MN is 15 ¢/kilowatt-hour (kWh)—roughly 27% lower than the national average cost. That number is based on real-world electric bills shared with EnergySage over the past 12 months. You can compare that number to the most recent average state electric price reported by the U.S. Energy Information Administration (EIA).
Minnesota’s electricity market is regulated, so you can’t choose which company supplies your electricity. Instead, the state determines your electric utility company based on where you live. There are three primary electricity companies in Minnesota, all of which are Investor Owned Utilities (IOUs), meaning they're private for-profit companies:
Minnesota Power
Otter Tail Power Company
Northern States Power Company
While the IOUs cover much of the state, some towns and cities are served by municipally-owned, not-for-profit electric companies that aren't subject to the same requirements as IOUs. These municipal utilities may offer lower rates, but may not offer benefits like net metering.
- 100% free to use, 100% online
- Access the lowest prices from installers near you
- Unbiased Energy Advisors ready to help
When you pay your electric bill, you’re not only covering the costs to produce that electricity, but also the costs of running and maintaining the electrical grid, as well as public benefit funds that promote things like renewable energy and energy efficiency.
Electric bill costs are rolled into fixed (monthly customer charges) and variable charges (¢/kWh that you use).
Fixed charges, like the flat fee for having a meter, generally remain the same monthly unless your utility makes a policy update.
Your variable charges will change every month and depend on your electricity rate and how much electricity you use.
Your electric bill's variable charges will include a supply (or generation) charge and a transmission and distribution (or delivery) charge. The supply charge covers the cost of electricity generation, while the transmission and distribution charges cover the cost of delivering it to your home.
In Minnesota, most utility companies give you the option to sign up for variable-rate plans, usually time-of-use (TOU) rates or demand charge plans, which can potentially help you further decrease your monthly electric bill if used in tandem with a solar or solar-plus-storage system.
How clean is the electricity in Minnesota?
Due to the complex nature of utility grids, it's not easy to pin down exact data regarding exactly where the energy that goes to your specific home comes from, but according to the U.S. Energy Information Administration, about 57% of the electricity on Minnesota’s utility grid comes from fossil fuels—primarily natural gas and coal—as of August 2025.
About 23% comes from renewable sources. Given that more than half of the grid’s energy comes from fossil fuels, installing a home solar panel system in Minnesota will almost always shrink your carbon footprint.
Some electricity suppliers give you the option to pay a bit more so that most (or even all) of your electricity comes from renewable sources. If you’re unwilling or unable to go solar in Minnesota but still want to reduce your carbon footprint, this is a great alternative. It just won’t save you any money in most cases.
As long as you have a suitable roof, one of the surest ways to save on energy is to go solar—ideally with a vetted contractor offering a competitive price.
Solar panels will reduce or even eliminate your electric bills in the short term and protect you against rising electricity costs in the long run, too. The amount you save depends on how much you spend on electricity now and how much of your electric bill you can offset with solar energy.
Solar panels are a big investment, but Duluth, MN homeowners who install them—and pay upfront—break even after an average of just 14.76 years. Then, the solar panels will continue to produce free electricity for years to come.
Does Minnesota offer net metering?
When the sun is shining, your solar panels usually generate more electricity than your home needs at any given moment.
That extra power doesn’t have to go to waste. As a Minnesota homeowner, you have easy access to net metering, a solar buyback program that provides energy credits for all the solar power you send to the grid. Later, when you need to pull electricity from the grid (like at night or on cloudy days), your utility company will apply your stored energy credits to your monthly bill.
Compensation rates for net metering in Minnesota vary depending on your specific utility company. You have the option to request to be credited at the Simultaneous Purchase and Sale Billing Rate (the flat rate) or at Time-of-Day rates. The flat rate is usually more favorable.
Either way, your energy credits are rolled over month to month—but only certain utility companies let you roll them over year to year, so be sure to check with your provider.
How much can you save with solar?
Thanks to rising electricity rates and state solar tax exemptions, you can often save when you go solar in Duluth, MN.
Just take a look at how much you'll spend on electricity over time based on your current bill. It’s easy to see how going solar can pay off quickly.
Electricity cost over time in Minnesota
Current monthly electric bill | 10-year electricity cost | 20-year electricity cost | 30-year electricity cost |
|---|---|---|---|
$50 | $6,800 | $15,000 | $27,000 |
$100 | $14,000 | $31,000 | $54,000 |
$150 | $20,000 | $46,000 | $80,000 |
$200 | $27,000 | $62,000 | $110,000 |
$250 | $34,000 | $77,000 | $130,000 |
Assuming a 3% annual increase based on inflation and average annual electric rate increases in Minnesota.
Let's assume you pay $181 for electricity monthly (the Duluth, MN average) and that electricity prices increase by 3% annually. Let's also assume you buy your solar panel system upfront and that it costs you $22,000 before any available incentives.
In the first year with solar, you'll avoid spending $2,200 on electric bills. Over five years, you'll avoid $11,400; by 10 years, you'll have avoided $24,400. Solar panels are usually covered under warranty for 25 years—by then, you'll have avoided spending $75,100 on electric bills in Duluth, MN.
The average payback period in Duluth, MN is 14.76 years, so by this point, you've already broken even on your investment. When you subtract your upfront installation cost, you'll pocket $53,500 over 25 years with solar.
Your solar savings depend on you
How much your utility company charges for electricity is a big indicator of how much you'll save with solar. But your exact solar savings depend on your unique situation—including your energy usage, roof layout, system size, and how you pay for your system.
Here are some reasons your savings could be below average:
You don’t use much electricity, or your roof is small or has a less-than-ideal layout. You might have a relatively long payback period, so you'll save a little less over time.
You don't install enough solar panels to 100% offset your energy use. You’ll pay less up front but save less in the long run.
You finance your solar panel system with a loan or sign a lease or power purchase agreement (PPA) instead of paying up front. These types of arrangements can make a lot of sense for keeping your capital flexible and will allow you to start saving sooner. But they will cut into your long-term savings.
Choosing a high-quality solar installer is the key to getting a top-notch solar panel system that will help you save on electric bills.
We pre-screen all solar companies on EnergySage to ensure they get the job done right. Here are the highest-rated EnergySage installers in Duluth, MN:
Elite+ InstallerScreened & Verified5.0 /5.0104 Reviews
Elite+ InstallerScreened & Verified4.8 /5.0363 Reviews
Elite InstallerScreened & Verified4.5 /5.0107 Reviews
Advanced InstallerScreened & Verified5.0 /5.013 Reviews
Approved InstallerScreened & Verified5.0 /5.02 Reviews
Helping customers make informed decisions since 2009.
