Switching to solar can save you thousands on (or even entirely eliminate) your electric costs, but many prospective solar owners are overwhelmed by the upfront cost of quality solar panels. For instance, your bill for electricity from the grid comes monthly, but with solar, you see the full cost up front unless you finance your solar system. The exact price will depend on your specific energy needs. There are multiple state and federal solar incentives available for solar owners, designed to make the process as affordable and accessible as possible. It’s important to note that while solar leases do allow you to save on your electric bill overall, they are not eligible for state or federal incentives. Solaris highly recommends purchasing your solar panels for multiple reasons, but especially because only owners can save through government incentives for renewable energy sources.
In this post, we’ll discuss some solar incentives specific to Massachusetts. Additionally, we will delve into the Renewable Energy Credit Program (REC) and how it works here.
Massachusetts Solar Incentives
There are both state and federal solar incentives available for solar owners. This section will specifically discuss Massachusetts state incentives, including tax credits and exemptions.
Renewable Energy Credit (REC) Program
The Renewable Energy Credit or Renewable Energy Certificate Program was established to encourage more homes and businesses in Massachusetts to use renewable energy systems. Essentially, RECs prove that a certain portion of electricity is generated from renewable sources and act as a “reward” for using clean energy. One REC is issued for every megawatt hour of solar energy produced.
RECs can be bought and sold through a market known as the Class 1 REC Open Market. Mediators who facilitate the sale are known as REC aggregators. Prices fluctuate depending on the solar market, so another role of REC aggregators is determining the best time to sell.
RECs can be sold to utility companies, who are seeking them as a way to showcase their clean energy efforts. Having a certificate proving that they’re complying with environmentally friendly practices reflects positively on these companies. Many customers want to use a company that prioritizes sustainability.
For solar owners, RECs are a great way to earn money, while also protecting the environment!
Massachusetts Solar Tax Credit
Massachusetts solar owners can earn a 15% state tax credit worth up to $1,000. Massachusetts residents are extremely fortunate because this tax credit is considered one of the best state solar tax programs in the United States.
Massachusetts Property Tax Exemption
Owning solar can increase the value of your home substantially. Massachusetts state law guarantees that for the next 20 years, renewable energy equipment is exempt from local property taxes. This includes solar panels, energy storage systems, and more. Systems must produce at most 125% of your home or business’s yearly electric needs, and be used as a primary energy source (in other words, you would have to rely on solar more than the grid). At Solaris, we size your system to overproduce power, meaning you will likely rely on your own system as your main energy source for the majority of the year.
Massachusetts Sales Tax Exemption
Alongside the tax credit and property tax exemption, purchases for renewable power systems are additionally exempt from state sales tax. This includes solar and wind powered products, as well as heat pump systems.
Federal Solar Incentives
Federal Solar Tax Credit
Solar owners can earn a refund from the federal government of 30% of the total cost on their solar system installation. This includes more than the implementation of actual solar panels; it also applies to necessary roof work, electrical upgrades, tree removal, and more! The following tax season, you’ll see a 30% refund of your total solar installation expenses on your taxes.
Other Local Incentives
Net Metering
Most solar owners are still connected to the electric grid, although they don’t rely on it as frequently (or, in some cases, at all). Major utility companies in Massachusetts offer net metering, allowing you to sell your “extra” electricity back to the grid. Oftentimes, your solar panels will produce more energy than necessary, and this surplus energy can be sold back to the grid and redeemed for credits. At Solaris, we size your system so it overproduces power in the sunny months, therefore it is very likely you will have extra power to be sold back to the grid. The credits can cover part of (or the entire) cost of future electric bills. We are a full service solar company, so we can handle all of those financial aspects for you!
Solar’s Return on Investment
Outside of all of the incredible incentives we just discussed, solar is the best way to get the same power to your home but at a greater, more cost efficient, and environmentally friendly way. Not to mention the return on your investment is roughly between 7 to 9 years, and with your solar panel warrantied anywhere from 25-40 years. After your return on investment, you’re cash flow positive and not paying for anything. That’s quite a long time with free electricity to your home!
Massachusetts Offers Some of the Best Solar Incentives
Massachusetts has made tremendous strides in terms of our clean energy movement. Our solar incentives are some of the most advantageous in the country. While the upfront cost of solar installation can be overwhelming, these solar incentives are designed to make installation and other necessary clean energy-related purchases as cost-efficient as possible. Contact Solaris today to get started on the solar process and start saving now!