Despite being one of the smaller states by area, Massachusetts is consistently one of the top states for solar energy. That’s thanks to strong solar incentives and high electricity rates. Affordable solar helping you avoid high energy bills is a winning combination.
Massachusetts’ rich history of solar incentives reaches all the way back to the 1970s, but, wrapped in legal or utility jargon, incentives aren’t always the easiest thing to understand.
Here’s your guide to the rebates, tax credits, net metering and other programs Massachusetts offers to make going solar easier.
See how much you can save by going solar with Palmetto
Solar Rebates, Tax Credits, and Incentives in Massachusetts
To maximize the value of your solar energy investment, take advantage of as many financial incentives as possible. In 2024, Massachusetts residents may be able to qualify for federal and state tax incentives as well as a few local programs designed specifically to incentivize residential renewable energy production and storage.
Note: Your eligibility can depend on your location, electric utility provider, income level, interest in battery storage, and more. This is not tax advice, and you should always consult a tax professional.
Residential Renewable Energy Tax Credits
If you’re installing a photovoltaic (PV) solar energy system in Massachusetts, you may be eligible for two separate tax credits, at the federal and state level.
Locally, Massachusetts homeowners can earn a state income tax credit (up to $1,000) totaling 15% of the net system costs of a solar energy installation. Officially known as the Massachusetts Residential Renewable Energy Income Tax Credit, this incentive can be claimed for up to three years against a property owner’s state income tax liability.
Federally, Massachusetts residents may also qualify for the Residential Clean Energy Credit to claim up to 30% of the total installation costs against their federal income tax liability. Recently extended by the Inflation Reduction Act of 2022, the Residential Clean Energy Credit (formerly known as the solar Investment Tax Credit) is a federal solar tax credit that has helped drive significant growth in solar power capacity across the United States since 2006.
Massachusetts Net Energy Metering
Net energy metering, or simply “net metering” is a longstanding Massachusetts solar incentive that allows homeowners to sell the excess electricity produced by their solar panel system directly to the utility in the form of an electricity bill credit.
In Massachusetts, all three major investor-owned utilities (National Grid, Eversource, and Until) offer 1-to-1 net metering. This means that home solar producers are compensated for their power at the same retail rates for which it is purchased, so that any grid energy used at night (or in cloudy conditions) can be offset by excess solar generation during the day. Residential solar systems up to 25 kilowatts are eligible for net metering in Massachusetts, double the previous capacity limit.
Net metering credits in Massachusetts roll over indefinitely from month to month, and solar producers are always compensated in the form of utility bill credits. You won’t see a check for the extra energy you produce.
If you get your electricity from a utility other than National Grid, Eversource, or Until, your policies may vary. Net metering is voluntary for the many small municipally-owned electric companies in Massachusetts so the policy governing your system might look different. Most utilities have their policies posted online. Research them there or reach out directly to your local utility to learn more.
Massachusetts SREC Program
On top of net metering credits, Massachusetts solar producers can also earn solar senewable energy credits (SRECs) for every 1,000 kWhs of power they generate. These credits can then be sold on the open market to entities required to use a certain amount of renewable energy. Prices vary by supply, demand, and several other local factors.
As the first state to ever set up a program of its kind, Massachusetts pioneered its original SREC program in 2010 as part of its Renewable Portfolio Standard (RPS). The program has been modified several times.
New solar panels will generate SRECs, currently defined as Class I RECs, which can be sold via one of several SREC trading platforms.
If you own a solar energy system in MA that generates renewable energy credits, Palmetto and SRECTrade can help you sell your SRECs at a flat compensation rate for up to 10 years of power production. SRECTrade will monitor and report on production data, create and trade SRECs in the open market, and issue payment to homeowners for those SRECs.
See how much you can save by going solar with Palmetto
Massachusetts ConnectedSolutions Program
As a solar battery storage incentive, the ConnectedSolutions program has been driving energy resilience in Massachusetts since 2019.
By installing a battery backup and joining the program, both Eversource and National Grid customers can earn hundreds of dollars each year by allowing their utility to access the energy stored in their batteries during periods with peak electricity demand.
To enroll in ConnectedSolutions, battery owners must apply with their utility. (The program is slightly different for National Grid and Eversource customers.) Most modern solar batteries will qualify for the program, including devices from Tesla (Powerwall), Enphase, SolarEdge, SunPower, and more.
State Sales and Property Tax Exemption
Like many states, Massachusetts offers both a sales and property tax exemption for solar energy systems. Essentially, this means that there will be no surprise expenses when you adopt solar in MA.
Sales tax exemption: In 2024, renewable energy equipment is completely exempt from sales and use tax in Massachusetts, which saves solar adopters an average of 6.25% on most transactions.
Property tax exemption: Although adding solar has been proven to increase the value of a home, Massachusetts homeowners do not have to worry about a PV installation raising their property taxes. Whenever the value of MA property is assessed, renewable energy equipment is completely exempt for a 20-year period.
Local Utility Rebates
When going solar in Massachusetts, you may qualify for a variety of solar installation rebates dependent on your home’s location and electricity utility. As small municipal utilities (also known as “munis”) supply 13% of MA’s electricity across 50 different communities, individual rebates are extremely localized and vary in value across the state.
For example, those lucky enough to live in beautiful Concord, MA can receive a one-time $650 per kW rebate (up to $3,125) for installing solar panels and connecting them to the grid.
Like with net metering policies, more information about local solar rebates from MA’s municipal utilities can be found by contacting your electricity provider directly, or visiting their website.
Former Solar Incentives
Not all solar incentives last forever. Massachusetts has had a couple of previous renewable energy credit programs that are now closed to new participants.
We’re discussing them here because, if you’re considering solar and researching your options, you might run into them. If you’re talking to your neighbors about their experience with solar panels, you might find they’re participants in these programs, which are closed to you.
Massachusetts SMART Program
Launched in 2018, the Solar Massachusetts Renewable Target (SMART) program also allows homeowners to generate separate renewable energy credits (REC) for the power they produce and send to the grid.
Solar producers enrolled in the MA SMART program are compensated for their energy at various rates, based on their electricity provider and the “block” for which they were enrolled. They must be customers of Eversource, Until, or National Grid. After slowly losing value for four years, the remaining incentives for the Massachusetts SMART Program are worth nothing.
Go Solar in Massachusetts Today
With such a wide variety of local incentives, paired with multiple Massachusetts solar tax credits and state-wide programs, the best way to go solar in Massachusetts is with an expert by your side.
If you’re interested in going solar in Boston, down the Cape, or anywhere else across the Bay State, Palmetto can help maximize your savings by identifying all of the available Massachusetts solar incentives and designing a high-quality PV system to fit the unique demands of your property.
Whether you’re ready to go solar today or are just starting to explore your options, you can see your estimated energy savings in Massachusetts, including any available incentives, instantly with our free solar savings estimate and design tool.
See what solar can do for you:
Disclaimer: This content is for educational purposes only. Palmetto does not provide tax, legal, or accounting advice. Please consult your own tax, legal, and accounting advisors.
Cory O'BrienSenior Director - Growth MarketingCory brings over 8 years of solar expertise to Palmetto, and enjoys sharing that knowledge with others looking to improve their carbon footprint. A dog lover residing in Asheville, NC with his wife, Cory graduated from UCSB. If you run into him, ask him about the company he founded to rate and review beer!
