Financial incentives available in Massachusetts

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Types of Solar Electric systems
Advantages and disadvantages of photovoltaics
Solar Energy Case Studies
Calculating Costs

There are many benefits to owning renewable energy systems, and financial incentives make it more attractive to do now. Here is some information to get you started.

Commonwealth Solar
A rebate program for the installation of grid-tied photovoltaic projects at residential, commercial, industrial, institutional, agricultural and public facilities. Non-residential projects are eligible for rebates for PV projects up to 500 kilowatts (kW) and residential projects are eligible for up to 5 kW. The applicant (and project site) must be a customer of a Massachusetts investor-owned electric utility. For more information call 508-439-5700 or email Commonwealth Solar.

Small Renewables Initiative (SRI)
A rebate program for small-scale (10 kW or less) wind, and hydropower offered by the Massachusetts Technology Collaborative (MTC). An energy audit is required - call 866-527-7283. For more information on SRI, call (508)-439-5640.

Large Onsite Renewables Initiative (LORI)
Grant awards for feasibility studies and design and construction projects of qualifying renewable energy systems greater than 10 kW. Eligible projects are those located at commercial, industrial, institutional or public sites. The system must be served by a Massachusetts investor-owned electric utility company. Qualifying technologies include: wind, fuel cells, hydroelectric, landfill gas, and advanced biomass power conversion technologies. For solar photovoltaic projects, refer to Commonwealth Solar or call 508-870-0312, ext. 1273.

Massachusetts State Tax Credits

These credits for solar electric (photovoltaics), solar hot water and wind systems reduce the total amount of tax owed. 15% of the system cost after any grants are subtracted. Residential maximum tax credit is $1,000. If you don’t owe that much in taxes, the balance can be rolled over into the following year(s). Corporate tax credit maximum is $300 and expires 12/31/07. Visit this site and click on Massachusetts.

Federal Tax Credits

Residential: An individual can take the 30% credit of the solar system cost after any grants and state tax credits are subtracted, up to a maximum $2,000 cap for photovoltaics, and a separate $2,000 cap for solar water heating. At least half of the energy used to heat the dwelling's water must be from solar to be eligible. No part of either system can be used to heat a pool or hot tub. Fuel cells qualify for a 30% tax credit up to $500 per .5 kW. Any excess credit may be carried forward to the succeeding tax year. Credits are available for systems "placed in service" between 1/1/06 and 12/31/08.

If the installation is on a new home, the "placed in service" date is the certificate of occupancy date. Systems that have previously been installed are not eligible.

Business/Corporate: If placed in service between 1/1/06 and 12/31/08, 30% tax credit for solar PV and solar hybrid lighting (no maximum) and fuel cells ($500 per 0.5 kW max.) 10% for micro-turbines (max $200 per kW), and 10% for geothermal systems.

Learn more.

Federal Residential Energy Efficiency Tax Credits
10% of cost of qualified efficiency improvements, 100% for qualified energy systems (heating, cooling, water heaters) if installed between 1/1/06 and 12/31/07. $500 maximum credit for all improvements for all tax years.

Financial Incentives and 0% Interest Loans on Energy Measures
MassSAVE, sponsored by electric and gas utilities, offers 50% rebates (up to $1,500) for eligible energy efficiency measures. You may also qualify for a 0% interest loan for efficiency measures and solar hot water. The maximum loan amount is $10,000 not to exceed 7 years. For more information, you can also call 1-866-527-7283.

Renewable Energy Certificates (RECs)

RECs represent the environmental benefits of the kilowatts produced by a renewable energy system, and have market value because they offset pollution from energy produced by fossil fuels. PV, wind and small hydro RECs from grid-connected systems can be sold to a renewable energy supplier. Suppliers in Massachusetts: Visit the Mass Energy Consumers Alliance website, or call 617-524-3950. Conservation Services Group at 508-836-9500 ext. 3361.

More resources

• The Tax Incentives Assistance Project (TIAP) is sponsored by a coalition of public interest nonprofit groups, government agencies, and other organizations in the energy efficiency field. This resource gives consumers and businesses information they need to make use of the federal income tax incentives for energy efficient products and technologies passed by Congress as part of the Energy Policy Act of 2005.
• The US Department of Energy has a comprehensive site with information about energy efficiency and renewable energy.
• The Massachusetts Department of Energy Resources has more information about incentives and assistance for particular projects. They can also be reached at 617-727-4732.
• GasNetworks is an umbrella organization for the gas utilities, offering information on rebates for heating and hot water systems, thermostats and more. If you heat with Berkshire Gas, go here.
• Energy Star is a joint program of the U.S. Environmental Protection Agency and the U.S. Department of Energy that helps you save money and protect the environment through energy efficient products and practices for homes and businesses.
• The USDA Farm Bill Section 9006 established the Renewable Energy Systems and Energy Efficiency Improvements Program. This program funds grants and loan guarantees to agricultural producers and rural small business for assistance with purchasing renewable energy systems and making energy efficiency improvements.