Massachusetts next generation solar incentive

The Massachusetts Department of Energy Resources is developing a new solar incentive program.  DOER released its proposal for the next generation of solar incentives on September 23, 2016. 

The 2016 legislation, An Act Relative to Solar Energy, included an extension and expansion of net metering, a policy which has supported the development of most solar projects in Massachusetts to date.  But because the state's solar renewable energy certificate (SREC) program is reaching its end, the recent law also directed the Department to "develop a statewide solar incentive program to encourage the continued development of solar renewable energy generating sources by residential, commercial, governmental and industrial electricity customers."

The 2016 law specified certain required characteristics of the "next generation" solar incentive program, including that it must be one which: "promotes the orderly transition to a stable and self-sustaining solar market at a reasonable cost to ratepayers," considers underlying system costs, takes into account electricity revenues and incentives, relies on market-based mechanisms or price signals, minimizes costs and barriers, features a declining incentive framework, differentiates incentive levels, "ensures that the utility customer realizes the direct benefits of the solar incentive program," considers the value of distributed generation and encourages solar generation where it benefits the distribution system, shares program costs collectively among all ratepayers, and promotes investor confidence through long-term incentive revenue certainty and market stability.

DOER released its "Next Generation Incentive Straw Proposal" on September 23.  Highlights include:

• DOER believes that a tariff-based incentive program would be best mechanism to continue supporting solar at the lowest cost to ratepayers.
• Incentive values would be based primarily on project size, with "adders" for different types of project (based on location, off-taker, or policy considerations like promoting energy storage).
• Project eligibility criteria include being connected to the electric grid in Massachusetts, interconnected on or after January 1, 2017, and not being qualified under the previous SREC I or SREC II programs.
• Siting criteria are included - for example, ground mounted projects would be prohibited if sited in certain wetlands, prime farmlands or forest land, or permanently protected open space.
• Changes to "solar canopy" policy, to allow solar canopies to be installed on agricultural land and over canals.
• Additional support for solar facilities serving low-income properties.

DOER noted that implementing this vision would require rulemaking by DOER, as well as a proceeding before the Department of Public Utilities regarding tariffs.

DOER is accepting written comments on the proposed program design until October 28, 2016.