If you live in Stow and are considering installing solar for your home or business, this article is for you.
A key financial incentive for solar, called SRECs (Solar Renewable Energy Certificates), will soon be discontinued for new solar installations and replaced by a program called SMART (Solar Massachusetts Renewable Target). The SMART program may not be available to Stow residents or any other community served by a municipal light plant (“MLP”) such as Hudson Light & Power, Stow’s electricity provider. It is anticipated the change will occur as soon as this summer. If you already have installed solar, this change will have no impact, and your SREC payments will continue. For a typical residential solar installation, SREC payments are around $1,500 a year and continue for 10 years from the time of installation. It is uncertain what, if any, incentive program will replace SRECs in towns like Stow. So if you have been considering solar, you may want to act soon before the SREC program is discontinued.
Massachusetts has seen enormous growth of solar installations over the last several years due to both the lower costs of solar and a combination of federal, state, and local incentive programs aimed at promoting this clean source of energy. The new SMART incentive program is structured to gradually decrease incentives for new installations as the cost of solar decreases further. However, a key aspect of the new program is that the state’s regulatory authority does not extend to MLPs, such as Hudson Light & Power. This means the MLPs are not obligated to participate in the SMART program and, in fact, the program is not structured to enable direct MLP participation. MLPs serve 15% of the state with the remainder of the state served by the large privately owned utilities such as Eversource and National Grid. The MLPs are considering a voluntary incentive program to replace SRECs, but no proposal has emerged yet.
So how might this impact you? If you live in Stow and already have installed solar, there is no impact and your SREC payments will continue. However, if you are considering solar, there will be a financial impact depending on when your solar installation is completed.
If you are a home owner or small business, a new solar installation will continue to be eligible for the current SREC program until the SMART program starts, possibly this summer. So by installing soon, you can “lock in” this incentive.
If you wait until after the SMART program starts, it is uncertain what, if any, incentive will be available in place of the existing SREC program. This depends on whether the MLPs agree on a voluntary program, what incentives the program offers, and whether Hudson Light & Power participates in the program. So, if you wait to install solar until after the SMART program starts, there is a real possibility you will receive little or no financial incentive in place of the SREC program.
Keep in mind, this doesn’t impact the other incentives available to Stow residents for solar. These include federal and state tax credits, a credit equivalent to the PAC (Power Adjustment Charge) for excess power from your solar installation “fed to the grid,” and, if you qualify, Hudson Light & Power’s “Photovoltaic Incentive.”
If you are considering solar, it would be helpful to contact a solar installer soon to see what the difference could be between an installation completed this year, under the current SREC program, versus waiting. Installing solar is good for the environment, but you also want it to be a good financial choice.