Worcester, MA Solar Panels

The Massachusetts Residential Renewable Energy Tax Credit is a state tax credit that rewards homeowners and tenants who install solar or wind energy systems at their primary residence. This credit allows you to claim 15% of your net expenditure for qualifying renewable energy equipment, up to a maximum of $1,000. The net expenditure includes the purchase price and installation costs, minus any grants or rebates you receive from the U.S. Department of Housing and Urban Development.

To qualify, you must be a Massachusetts resident who owns or rents the property and lives there as your primary residence. You cannot be claimed as a dependent on someone else’s tax return. The renewable energy equipment must be new (original use begins with you), expected to last at least five years, and used primarily for residential purposes—such as heating, cooling, providing hot water, or generating electricity. Qualifying solar equipment includes items like solar collectors, storage tanks, and heat exchangers, while qualifying wind equipment includes windmills and wind-driven generators. Note that structural components serving dual purposes (like windows, roofs, or walls) and energy efficiency items (like insulation or thermostats) do not qualify.

If your credit exceeds your tax liability in a given year, you can carry the unused portion forward for up to three additional years. The $1,000 maximum applies to all renewable energy expenditures made for the same principal residence over time, so if you’ve claimed this credit before for the same home, your available credit will be reduced accordingly. Joint owners can share the credit proportionally based on their ownership interest or expenditure share, and condo or co-op owners may claim their proportionate share of association expenditures for qualifying systems.

Massachusetts offers a property tax exemption for homeowners who install solar energy systems on their property. This exemption means that adding solar panels to your home won’t increase your property taxes, even though the system adds value to your property. The exemption protects you from paying additional property taxes on your solar investment for 20 years, and in some cases, municipalities may agree to extend this period even longer.

To qualify, your solar system must meet one of these conditions: it produces no more than 125% of your property’s annual electricity needs, it’s 25 kilowatts or smaller in capacity (verified by state program documentation or utility permission to operate), or you’ve entered into a payment-in-lieu-of-taxes agreement with your municipality. The exemption applies to both owned and leased systems, and it covers systems that include battery storage. Keep in mind that you can only claim one property tax exemption at a time on the same property, though some exceptions apply. This exemption does not apply to large commercial solar farms or systems owned by utility companies.

Massachusetts offers a sales tax exemption on solar equipment purchases, allowing homeowners to avoid paying the state’s sales tax when buying solar panels and related equipment. This exemption applies to solar energy systems and components, meaning you won’t pay the standard Massachusetts sales tax rate on your solar equipment purchase. The savings are automatic at the point of sale when you work with a qualified solar installer.

This exemption is available to all Massachusetts residents who purchase qualifying solar energy equipment, with no income restrictions or application process required. The benefit applies to the equipment itself, including solar panels, inverters, batteries, and other necessary components for your solar energy system. Your solar installer will typically handle the exemption automatically during the purchase process, so you’ll see the tax savings reflected in your final cost. There are no deadlines or expiration dates for this exemption—it remains available as long as the state law is in effect, making it a reliable benefit you can count on when planning your solar investment.

The ConnectedSolutions Battery Incentive is a Massachusetts state program that pays homeowners for allowing their battery storage system to help reduce strain on the electrical grid during peak demand periods. When you enroll, your utility company (Cape Light Compact, Eversource, or National Grid) will automatically draw power from your battery during summer events—typically on hot afternoons when electricity demand is highest. You’ll earn $275 per kilowatt (kW) based on your battery’s average contribution during these events, which means a typical 5 kW battery system could generate up to $1,375 annually.

To participate, you must be a customer of one of the three participating utilities and install an eligible battery storage system with an inverter size under 50 kW. The battery can be installed alongside a new solar panel system, added to an existing solar setup, or installed as a standalone unit. Qualifying manufacturers include Tesla, Enphase, SolarEdge, Generac PWRCell, and several others. Events occur no more than 60 times each summer (June 1 through September 30) between 3:00 p.m. and 8:00 p.m., with each event lasting up to three hours. The program also offers 0% financing through HEAT Loans for up to $25,000 to help make battery installation more affordable. By participating, you assign the environmental credits (Clean Peak Energy Credits) to your utility sponsor, but this doesn’t affect your incentive payments.

The Solar Massachusetts Renewable Target (SMART) Program is Massachusetts’ primary state incentive for solar energy systems. This program provides a fixed monthly payment directly from your utility company (Eversource, National Grid, or Unitil) for the electricity your solar panels produce. The payment rate depends on when you apply, your system size, location, and how your system is configured. Because the program uses a declining block structure—meaning incentive rates decrease as more solar capacity is added—applying earlier typically results in higher payment rates. These payments continue for 10 years for systems under 25 kW and 20 years for larger systems.

To participate, your solar system must be connected to one of the three participating utility companies in Massachusetts. The base payment rate varies by utility territory and which capacity block your application falls into. Behind-the-meter residential systems (those that offset your home’s electricity use) receive payments based on a calculated “Value of Energy” plus the incentive rate. Additional payment bonuses are available if your system includes battery storage, is installed on a brownfield site, or qualifies for low-income programs. It’s important to note that due to recent electricity rate increases and the program’s declining structure, some newer applications in later blocks may receive significantly reduced rates or even $0.00 incentive payments, so checking current block availability is essential before moving forward.

The application process is managed through CLEAResult, the Solar Program Administrator, who reviews all submissions before recommending approval to the Massachusetts Department of Energy Resources (DOER). Homeowners should work with their solar installer to navigate the application process and understand which incentive rate their project will receive. Keep in mind that program capacity is limited to 3,200 MW statewide, and blocks fill up as applications are approved, so timing matters when planning your solar installation.

Net metering in Massachusetts allows you to receive credit for the excess solar energy your system sends to the electric grid. When your solar panels produce more electricity than your home uses, that surplus power flows back to the grid, and your utility company credits your account. These credits work on a 1:1 basis for most Massachusetts utilities, meaning you receive the full retail rate for every kilowatt-hour (kWh) you export.

The financial benefit varies slightly depending on your utility provider. If you’re a customer of National Grid, Eversource, or Unitil, your excess credits carry over month to month as a dollar value and never expire—though they won’t be paid out as a check. For Taunton Municipal Light Department customers, the system works differently: each month, your exported energy is netted against your consumption on a 1:1 basis, but any monthly excess is only credited at the lower generation rate (approximately 6.5-9.5 cents per kWh) rather than the full retail rate.

Net metering is generally available to homeowners who install solar panels and connect to the grid through participating Massachusetts utilities. There are no specific deadlines to enroll, as this is an ongoing program. However, it’s important to understand that while your credits accumulate indefinitely with most utilities, they remain as bill credits rather than cash payments, so they’re most valuable when you continue using electricity from your utility provider.