Massachusetts Solar Incentives
Massachusetts & Cape Cod Solar Energy Incentives are some of the best in the country!
Current solar incentives have helped our state become a national leader in promoting and facilitating renewable energy and energy efficiency! These include; net metering, Solar Massachusetts Renewable Target (SMART) incentive program, along with other generous state energy efficiency programs in addition to federal incentives.
We will help you understand which incentives you qualify for and how you can take advantage of them!
For over 20 years, Clean Energy Design has been an industry leader in the design and installation of commercial and residential photovoltaic and solar thermal systems in southern New England, particularly Massachusetts. Massachusetts Solar Energy Incentives are some of the most progressive in the country! We are very proud that Massachusetts leads the way in allocating resources to ensure the adoption of clean, renewable energy sources and that we have been able to play a role in that progress. We’ve happily participated in helping to expand the Massachusetts solar energy incentive programs and initiatives over the years.
Our experience includes dozens of successful applications for institutions, residences and businesses under the Commonwealth Solar Hot Water Program (below), Commonwealth Wind Program, and now expired Commonwealth Solar II Program, MTC Small Renewables Initiative, PV Cluster Program, and Large On-Site Renewables Program.
Solar Loan Program
Massachusetts Solar Loans make it easy for MA residents to obtain low-interest loans to fund the installation of solar electricity systems for their homes!
This program is a partnership between the Massachusetts Department of Energy Resources (DOER) and the Massachusetts Clean Energy Center (MassCEC) which connects homeowners interested in solar electricity to solar installers and lenders that have available financing options. Through the program, lenders offer low-interest loans for Massachusetts residents and property owners, including renters and those with moderate incomes or low credit scores. The program is financed through $30 million of Alternative Compliance Payments from the Department of Energy Resources. DOER provides program and policy oversight of the Mass Solar Loan program while the MassCEC acts as the program Central Administrator.
The Program structure is as follows:
- Offering low-interest loans for Massachusetts residents and property owners, including renters.
- Non-Income Qualified Customers (greater than 80% of State Median Income) – will not be eligible for any loan support incentives (IRBD, IBLS, and Loan Loss Reserve), however they will still be able to take advantage of technical project approval and program structure to seek market rate loans from a participating lender. Standard loan requirements and program oversight such as the interest rate and closing cost caps will still be applicable for non-income qualified customers.
- Low Income Customers (80% or below of State Median Income) – for customers in this category, the incentives will remain unchanged from the current program structure. Low income customers will be eligible for Income Based Loan Support corresponding to 30% of the loan amount, capped at $10,500, and will be able to qualify for Loan Loss Reserve if eligible. Low income customers will be eligible for a 1.5% Interest Rate Buy Down (the current IRBD rate).
- For more information visit MA Solar Loan
Solar Massachusetts Renewable Target (SMART) Program
Solar Massachusetts Renewable Target (SMART) is a tariff-based incentive program that supersedes the SREC II program. Like the SREC program, it is based on the performance of your system.
The SMART Program is a long-term sustainable solar incentive program sponsored by Eversource, National Grid and Unitil. SMART will encourage the development of solar photovoltaic (PV) technology by supporting 1,600 MW of new solar generating capacity. It is a declining block program in which the incentive levels will decline by prescribed amounts over up to eight blocks per Electric Distribution Company (EDC) territory.
There are set-aside amounts for small projects (≤ 25 kW AC) in each block to enable projects of all sizes to participate. SMART also has Adders available that increase the amount of the incentive if features such as Energy Storage, Community Solar, or various location-based installations are proposed.
Although it is a performance-based incentive, the SMART program is structured quite differently than its predecessor. Your utility will monitor and track the production of your solar system monthly through a SMART meter that is installed on the outside of your home or business. Payments will be issued monthly or credited to your account based on the kWh of solar power produced and independent of electricity usage. In most cases this income is taxable and it is required to submit a W-9 to your utility when applying for this program.
Under the final tariff design there are different rates for projects of different scales up to 5 MW per site. Incentives will be provided for 10 or 20 years, with varied values depending on ownership, system size and location. The tariff will consist of 8 blocks, with tariff values decreasing 4-5% in each subsequent block. For systems 25 kW and less the term is 10 years and for systems over 25 kW the term is 20 years.
Block 2 compensation for most Eversource residential customers with systems under 25 kW the value is approximately $.12 per kWh.
Block 2 compensation for most Eversource commercial systems 25- 250 kW the value is approximately $0.07 per kWh for 20 years.
For more information on the Solar Massachusetts Renewable Target (SMART) Program please visit MA Smart Solar
Federal Tax Credits
- 30% for residential installations which must be placed in service by the end of 2019
- 30% for commercial installations that have begun construction (see Seia.org for more specific info)
- Steps down to 26% for installations January 1, 2020 through December 31, 2020
- 22% for installations January 1, 2021 through December 31, 2021
- 10% for installations January 1, 2022 through December 31, 2022
It is unclear whether the federal tax credit will remain at 10% after the end of 2022 or if it will be removed completely for residential installations. If the federal tax credit exceeds tax liability, the excess amount may be carried forward to the succeeding taxable year. The excess credit may be carried forward for three years, but it is unclear whether it can be carried forward beyond that point.
We are not tax professionals and urge you to consult with your tax professional for the best advice.
In addition to the 30% ITC, businesses may take advantage of 5 year accelerated depreciation.
Residential Renewable Energy Tax Credit
In the state of Massachusetts, there is a Residential Renewable Energy Income Tax Credit that is applicable to solar and wind installations. Homeowners will receive a credit of 15% of the installed system cost, capped at $1,000. The state tax credit is only available for installed systems on an individual’s primary residence.
MA Property Tax Exemption
Massachusetts provides 100% property tax exemption for a duration of 20 years on photovoltaic energy systems used to generate electricity for a residence.
MA Sales Tax Exemption
Massachusetts offers sales tax exemption for equipment related to a solar electricity generation for a primary residence.
MA State Incentive Programs
Pleased visit the Massachusetts Clean Energy Center website for information on all state clean energy programs.
Details for some of the Commonwealth of Massachusetts Solar Rebates & Energy Efficiency programs are found on the links below.
For the most current information on the available federal & state tax credits for Solar and other Renewable Energy technologies, please visit the Database of State Incentives for Renewable Energy.