Massachusetts DPU (finally) issues SMART program order

Massachusetts solar

During Solar Power International last week, the Massachusetts Department of Public Utilities (DPU) issued an Order approving compensation for owners of new solar projects under the Commonwealth’s Solar Massachusetts Renewable Target (SMART) program. The approval is the final regulatory step in launching the program that is required by bi-partisan legislation signed by Governor Baker in 2016.

Massachusetts solar advocates have been waiting patiently for this moment to start moving on projects that have been stalled while awaiting the order.

“Today’s decision allows community solar to move forward and expand access to the 75 percent of residents in the Commonwealth who can’t place solar on their roofs,” said Brandon Smithwood, Policy Director for the Coalition for Community Solar Access. “We will continue to work with the Baker Administration to ensure the SMART program delivers on its promise of making affordable local community solar available to all residents and businesses who want it.”

“The release of the SMART Order from the DPU, and the program’s implementation, will help get the Massachusetts solar market moving again,” said David Gahl, Director of State Affairs, Northeast for the Solar Energy Industries Association (SEIA). “Although we are still reviewing the Order details, we are pleased to begin this new chapter. We look forward to working with the Baker-Polito Administration to help Massachusetts reclaim its place as one of America’s leading solar states.”

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“After many delays, this order from the DPU will help solar energy regain momentum across the Commonwealth,” said Mark Sylvia, President of the Solar Energy Business Association of New England. ‘“As always, details matter; we are still reviewing the specifics, but are encouraged by this critical step in putting the Massachusetts solar industry back on track through the SMART program.”

The SMART program, issued through DOER regulations in August 2017, provides compensation for all new solar projects under 5 MW in size in the investor-owned utilities service territory. The program differentiates specific compensation in terms of size and type of solar installations and for the first time in the country provides a specific incentive to pair new solar projects with storage.

“The SMART program is designed to encourage appropriate siting of solar projects by incentivizing projects on rooftops, parking lots, and landfills,” said Energy and Environmental Affairs Secretary Matthew Beaton.

What’s next?

Under the order, DPU rejected the distribution companies’ proposal for a cap that would have limited the amount of bill credits that individual customers could receive under community solar projects. DPU also rejected the distribution companies’ proposal to allow costs to be recovered through a fixed charge, instead requiring all ratepayers to contribute to costs through a volumetric charge as requested by many stakeholders and lowering the cost of the program for residential ratepayers.

“There is an opportunity to capitalize on the benefits of energy storage when paired with renewables and this program is designed to accomplish that,” said Department of Energy Resources Judith Judson. “Finding ways to reduce our peak demand and integrate more renewable energy is a top priority for this administration and utilizing solar paired with energy storage in addition to our energy efficiency programs is essential to lowering energy costs and emissions.”

“The SMART program tariff will provide more competitive incentives to solar developers and result in ratepayer savings compared to the existing solar incentive programs,” said DPU Chairman Angela O’Connor. “As solar costs stabilize, it is essential that both solar customers and ratepayers yield continued benefits for this growing clean energy resource.”

The department estimates the program will save ratepayers an estimated $4.7 billion over current programs, while promoting solar development through an incentive paid directly by the utility company to the solar generation owner. With the additional 1,600 megawatts (MW) of installed solar to be supported as a result of the SMART program, approximately ten percent of the Commonwealth’s annual electricity needs will be met by solar resources.

In a promotional email sent shortly after, Beaumont Solar noted that under SMART, its rooftop customer will be cashflow positive day 1 with or without tax incentives. For a 40,000 square foot roof that can fit a 350kW system, you can expect to see:

• Net income of $38K/year without any tax incentives (especially great for nonprofit organizations), or

• Net income of $60K/year with tax incentives.

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