MassSolar panel graphicachusetts has long been at the forefront of states spurring the development of clean energy.

One of the key tools to achieve the target of adding more renewable energy are Solar Renewable Energy Certificates (SRECs). The current program provides incentive payments for every kilowatt hour produced for ten years, enabling many site owners and solar developers to finance the construction of a solar project. The SREC program has been so successful that the target of 1,600 megawatts (MW) of solar capacity was reached on February 2, 2016, years in advance of the expected timeframe. In fact, the state went from 600 MW to 1,600 MW of solar projects developed or under construction in less than two years.

Once the 1,600 MW target was reached, solar developers and building owners worried about how to move forward.  Following several months of uncertainty, on April 8, 2016 Massachusetts Department of Environmental Resources (DOER), which administers the SREC program, announced a long-awaited update to the Solar Renewable Energy Credit II (SREC II) incentive.

The good news is that projects over 25 KW constructed by January 8, 2017 and authorized to interconnect to the local utility company’s grid will qualify for the current SREC II program. However, businesses will need to commence projects now to be assured of completion by next January’s deadline.

Under the program, a typical 500 kW roof-mounted solar project would generate approximately $170,000 annually in revenue from the sale of SRECs and energy. SRECs help to significantly reduce the cash required to build a project and leverage attractive federal incentives, including a 30% federal tax credit.

The SREC II program has succeeded in helping developers “do well by doing good.” It is a win for the state as well by keeping a portion of the $20 billion annually that Massachusetts currently spends on energy.