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Massachusetts

Massachusetts

Incentives/Policies for Renewables & Efficiency

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Solar Renewable Energy Certificates (SREC-II)   

Last DSIRE Review: 08/07/2014
Program Overview:
State: Massachusetts
Incentive Type: Performance-Based Incentive
Eligible Renewable/Other Technologies: Photovoltaics
Applicable Sectors: Commercial, Industrial, Residential, Nonprofit, Schools, Local Government, State Government, Tribal Government, Fed. Government, Agricultural, Institutional
Amount:Varies, depending on market supply and demand
Maximum Incentive:2014 compliance year: Alternative Compliance Payment Rate is $375 per MWh (~$0.375 per kWh)
Eligible System Size:6 MW (DC) or less
Start Date:April 2014
Web Site: http://www.mass.gov/eea/energy-utilities-clean-tech/renewable-ene...
Authority 1:
Date Enacted:
M.G.L. ch. 25A, ยง 11F
1997 (subsequently amended)
Authority 2:
Date Enacted:
Date Effective:
225 CMR 14.00 (Final)
04/25/2014
04/25/2014
Summary:

Massachusetts' renewable portfolio standard (RPS) requires each regulated electricity supplier/provider serving retail customers in the state* to include in the electricity it sells 15% qualifying renewables by December 31, 2020. The RPS was significantly expanded by legislation enacted in July 2008 (S.B. 2768), which established two separate renewable standards -- a standard for “Class I” renewables, and a standard for “Class II” renewables. The Massachusetts Department of Energy Resources (DOER) regulates the RPS and developed corresponding rules. In January 2011, final rules were implemented for the state's Solar Carve-Out program, which is the portion of the required renewable energy under the Class I Standard that must come from qualified, in-state, interconnected solar facilities. In April 2014, final rules were implemented that ended the application period for the original Solar Carve-Out Program, and established the Solar Carve-Out II Program.

Facilities qualified under the Solar Carve-Out II Program generate Solar Renewable Energy Certificates (SREC IIs), which represent the renewable attributes of solar generation, bundled in minimum denominations of one megawatt-hour (MWh) of production. Massachusetts' Solar Carve-Out II provides a means for SREC IIs to be created and verified, and allows electric suppliers to buy these certificates in order to meet their solar RPS requirements. All electric suppliers must use SREC IIs to demonstrate compliance with the RPS. The price of SREC IIs is determined primarily by market availability, although the DOER has created a certain amount of market stability by establishing a state Solar Credit Clearinghouse Auction II (where prices are fixed according to a yearly schedule minus a 5% administrative fee), as well as the Solar Alternative Compliance Payment (SACP) for the state RPS (set at $375/MWh for 2014). The Solar Credit Clearinghouse Auction II should only be utilized if or when SREC II generators cannot sell their SREC IIs on the open market.

Only solar-electric facilities built on or after January 1, 2012, may be qualified to generate SREC IIs. SREC IIs are generated on or after January 1, 2014, since that is the date the Solar Carve-Out program took effect. Generators must apply and receive a statement of qualification (SQ) from the DOER and must establish an account with NEPOOL GIS in order to participate in this program.

The SACP is currently set at $375 (2014) and the Solar Credit Clearinghouse Auction II price is currently set at $300 (2014). Both prices decline over time according to the following schedules:

Compliance Year

ACP Rate per MWh

Auction Price

Minus 5% Auction Fee

2014

$375

$300

$285

2015

$375

$300

$285

2016

$350

$300

$285

2017

$350

$285

$271

2018

$350

$271

$257

2019

$333

$257

$244

2020

$316

$244

$232

2021

$300

$232

$221

2022

$285

$221

$210

2023

$271

$210

$199

2024

$257

$199

$189

2025

added no later than January 31, 2015

 
Under the Solar Carve-Out II, facilities are differentiated by project type and are assigned a particular SREC Factor according to the market sector under which they are classified. The SREC Factor determines the percentage of output that is eligible to generate SREC IIs. For example, a building-mounted project larger than 25 kW would receive an SREC Factor of 0.9, meaning that it would receive 0.9 SRECs for every MWh it generates. Facilities are each assigned to a particular market sector as follows:
 

Market Sector

Generation Unit Type

SREC Factor

A

  1. Generation Units with a capacity of <=25 kW DC

1

  2. Solar Canopy Generation Units

  3. Emergency Power Generation Units

  4. Community Shared Solar Generation Units

  5. Low or Moderate Income Housing Generation Units

B

  1. Building Mounted Generation Units

0.9

  2. Ground mounted Generation Units with a capacity > 25 kW DC with 67% or more of the electric     output on an annual basis used by an on-site load

C

  1. Generation Units sited on Eligible Landfills

0.8

  2. Generation Units sited on Brownfields

  3. Ground mounted Generation Units with a capacity of <= 650 kW with less than 67% of the               electrical output on an annual basis used by an on-site load.

Managed Growth

  Unit that does not meet the criteria of Market Sector A, B, or C.

0.7

 

The Solar Carve-Out and Solar Carve-Out II programs are intended to support approximately 1,600 MW of solar facilities in Massachusetts. As the Solar Carve-Out Program has approximately 659 MW of qualified facilities, the Solar Carve-Out II Program will support approximately 941 MW of additional solar facilities by no later than 2020. Qualified projects will generate SREC IIs for the ten years from the date they are qualified. After ten years, facilities will continue to be eligible to generate renewable energy credits (RECs) and will be able to sell those for compliance under the Class I standard.
 

 

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Disclaimer: The information presented on the DSIRE web site provides an unofficial overview of financial incentives and other policies. It does not constitute professional tax advice or other professional financial guidance, and it should not be used as the only source of information when making purchasing decisions, investment decisions or tax decisions, or when executing other binding agreements. Please refer to the individual contact provided below each summary to verify that a specific financial incentive or other policy applies to your project.

While the DSIRE staff strives to provide the best information possible, the DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. make no representations or warranties, either express or implied, concerning the accuracy, completeness, reliability or suitability of the information. The DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. disclaim all liability of any kind arising out of your use or misuse of the information contained or referenced on DSIRE Web pages.

Copyright 2013 - 2014 North Carolina State University, under NREL Subcontract No. XEU-0-99515-01. Permission granted only for personal or educational use, or for use by or on behalf of the U.S. government. North Carolina State University prohibits the unauthorized display, reproduction, sale, and/or distribution of all or portions of the content of the Database of State Incentives for Renewables and Efficiency (DSIRE) without prior, written consent.