Solar Power Incentives
Solar Power Incentives
MA SREC Program
Performance-Based Incentive: The Massachusetts Department of Energy Resources (DOER) approved an SREC market which began in January 2010. The state has implemented a solar carve out that establishes a requirement for solar in Massachusetts. In addition to that, the state has implemented the MA Solar Credit Clearinghouse as a last resort, fixed-price auction in the last quarter of each year with a fixed price of $300 per SREC less a 5% fee resulting in a floor price of $285. This establishes a floor price for Massachusetts SRECs and gives project financers a minimum value they can expect per SREC, though prices could rise as high as $600 depending on market conditions.
Solar Renewable Energy Certificates (SRECs) represent the renewable attributes of solar generation, bundled in minimum denominations of one megawatt-hour (MWh) of production. Massachusetts’ Solar Carve-Out provides a means for SRECs to be created and verified, and allows electric suppliers to buy these certificates in order to meet their solar RPS requirements. All electric suppliers must use SRECs to demonstrate compliance with the RPS. The price of SRECs is determined primarily by market availability, although the DOER has created a certain amount of market stability by establishing a state Solar Credit Clearinghouse Auction (where prices are fixed at $300/MWh), as well as the Solar Alternative Compliance Payment (SACP) for the state RPS (set at $550/MWh for 2011). The Solar Credit Clearinghouse will only be utilized if or when SREC generators cannot sell their SRECs on the open market; the fixed price of $300/MWh effectively acts as price floor. The SACP, on the other hand acts, acts as a ceiling on the value of SRECs because it is the per-MWh payment that electricity suppliers must make if they fail to obtain enough SRECs to cover their RPS obligation.
State Rebate Program
The Massachusetts Clean Energy Center provides rebates for systems from 1,000 watts to 5,000 watts. The base rebate for residential systems is $0.40/watt (maximum $2,000 for a 5 kW system). Additional rebates are available based on income and home value, more details are available on our incentives page.
A home with a solar system is considered a net-metered facility through the customer’s utility company (unless the home is off the electrical grid). The solar energy produced is distributed through the home’s existing electrical system, and in the event that the system produces more energy than needed it is exported to the utility grid and the customer is given credit on monthly electrical bills. A single family residence with a 5 kW can expect to save up to $1,200.00 per year.
Additionally, all systems installed after Jan 1, 2010 are automatically enrolled into the State Solar Renewable Energy Certificate (SREC) program. Each month solar energy production is reported to the State Production Tracking System; energy certificates are minted and then sold to the utility company. The program is 40 quarters (10 years) and the current rate is $0.54/kWh. Based on the current SREC rate a 5 kW system will generate an average of $3,500.00 of revenue in the first year. The rate will decrease by no more than 10% per year over the course of the program until it reaches a minimum of $0.30/kWh. The graph below shows a conservative SREC forecast.
SunWind makes the SREC process seamless and effortless for the homeowner. Contact SunWind for more information.
Massachusetts and Federal Renewable Energy Incentives
U.S.D.A. Small Business Alternative Energy Grant (Small and Large Grant Programs)