The Massachusetts Department of Energy  Resources (DOER) designed a new solar program, called the Solar Massachusetts Renewable Target program (SMART). SMART eliminates and replaces the Solar Renewable Energy Certificates (SREC) Program, which operated as a tradable commodity that fluctuated based on market conditions. SREC II reached its capacity target of 1,600 MW of installed solar in MA in February of 2016.  Since then, there has been a patchwork of extensions for solar projects under development to continue to participate in SREC II until SMART is implemented.

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Using complex algorithms, SMART is establishing a feed-in-tariff to compensate solar developers for both the power and the environmental attributes associated with solar generation.  The program will be managed by DOER and entails:

  • A target of an additional 1,600 MW of installed solar in this declining block program
  • Base compensation rates to be set according to project size
  • Same compensation rates across all electric distribution companies
  • Compensation structure differentiated between sized-to-load and standalone systems
  • 20-year fixed price term (large project capacity)
  • Adders based on location and those that provide unique benefits (community solar, low-income, public, and energy storage projects)
  • Base compensation rates decline by set percentages in each block following Block 1 • Maximum project size of 5 MW per parcel

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SMART provides long-term revenue certainty for the solar developer, reducing financial risks and enabling solar facilities to receive a single compensation rate (accounting for both the energy and the incentive).  The prior program, SREC II, had developers relying on two separate streams of income, one from the value of the power created by the solar array, and the other from the sale of the associated environmental attributes.  

SMART is the latest of incentive programs implemented in MA to encourage the development of solar energy. Incentives are made to reward early adopters, and each new program for solar in MA has stepped down the value of the incentive.  This SMART program will end when the amount of installed solar in MA reaches 3,200 MW.  As with programs in the past, those businesses installing solar sooner are expected to see a higher level of compensation for their projects than those who come later.

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FireFlower Alternative Energy helps businesses profitably invest in America’s energy independence.  With a focus on the numbers, FireFlower invests in and develops renewable energy in the Northeast and can help site owners, commercial energy users and the financial community collaborate to get real projects built.  For more information about FireFlower Alternative Energy, visit www.fireflower-ae.comwww.fireflower-alternative-energy.com