Massachusetts takes the lead in promoting solar energy adoption by offering a range of enticing incentives for homeowners. These incentives include tax credits, exemptions, and programs that not only reduce your solar expenses but also contribute to a cleaner and more sustainable future. Let’s delve into the various offerings that can make your solar journey in Massachusetts both cost-effective and environmentally responsible.
Solar Massachusetts Renewable Target (SMART) Program
Comparable to Solar Renewable Energy Credits (SRECs) in other states, Massachusetts’ SMART program ensures that homeowners are rewarded for their solar power generation. Under this program, utility companies compensate homeowners for every kilowatt-hour (kWh) of solar power produced over a 10-year period. This direct payment by utility companies is granted upon approval from the Solar Program Administrator and the Department of Energy Resources (DOER). Eligibility requires being a customer of one of three investor-owned utility companies: Eversource, National Grid, or Unitil.
Residential Renewable Energy Income Tax Credit
Homeowners in Massachusetts can take advantage of the Residential Energy Credit, a significant tax credit. Those who own or reside in a residential property within the state can claim a 15% state tax credit for purchased residential solar systems. The credit is capped at the taxpayer’s personal income tax liability for the given year, ensuring a fair and equitable benefit.
Solar Installation Property Tax Exemption
While installing a solar panel system can enhance your property’s value, Massachusetts offers an exceptional incentive by exempting residents from property tax related to this increased value for a 20-year duration. It’s important to note that this exemption applies solely to the added value brought by solar or wind energy systems, providing homeowners a valuable financial advantage.
Home Solar Project Sales Tax Exemption
The Home Solar Project Sales Tax Exemption lets you sidestep the 6.25% sales tax in Massachusetts for your solar panel system. This applies to equipment directly associated with solar, wind-powered, or heat pump systems used as primary or auxiliary energy sources for your property. Provided your property is your primary residence, this exemption offers a direct and immediate cost reduction.
Net-Metering
Leverage the excess energy generated by your solar system with net-metering programs. By selling surplus energy back to your electric company, you earn utility bill credits. Eversource and National Grid facilitate this in Massachusetts, enabling you to maximize your solar investment while contributing to the overall energy grid.
Federal Solar Tax Credit
On a federal level, the investment tax credit (ITC) grants you the opportunity to claim a portion of your solar system expenses on your federal taxes. Qualifying homeowners who install systems within the tax year, and who own the system outright, can benefit from this credit. While this credit is currently at 30% of system costs and related expenses, it gradually reduces to 26% in 2033 and 22% in 2034. Eligible expenses span solar PV panels, labor costs, balance-of-system equipment, energy storage devices, and more.
These incentives demonstrate Massachusetts’ commitment to enhancing solar energy adoption and curbing greenhouse gas emissions. By embracing solar power, homeowners can experience substantial electricity savings and contribute to a cleaner, greener future, regardless of their location within the New England region.
