Massachusetts’ Department of Public Utilities (DPU) has issued an order approving compensation for owners of new solar projects under the commonwealth’s Solar Massachusetts Renewable Target (SMART) program.
The program, administered by the Department of Energy Resources, is expected to save ratepayers an estimated $4.7 billion over current programs, says the DPU. The program promotes solar development in the commonwealth through an incentive paid directly by the utility company to the solar generation owner.
The approval is the final regulatory step in launching the program, required by legislation signed by Gov. Charlie Baker, R-Mass., in April 2016. With the additional 1.6 GW of installed solar to be supported as a result of the SMART program, approximately 10% of the commonwealth’s annual electricity needs will be met by solar resources, according to the DPU’s estimates.
“Massachusetts is a national leader in solar energy with over 2,200 MW of solar installed across all 351 cities and towns of the commonwealth, and the SMART program will allow Massachusetts to expand its leadership by significantly increasing solar capacity while lowering costs for ratepayers,” says Baker. “In addition to the benefits to ratepayers and the commonwealth’s energy portfolio, the SMART program will be the first in the nation to offer incentives to solar projects that are paired with storage to capture the benefits of solar regardless of time of day or weather conditions.”
The SMART program, issued through DOER regulations in August 2017, provides compensation for all new solar projects under 5 MW in size in an investor-owned utility’s service territory. The program differentiates specific compensation in terms of size and type of solar installations and, for the first time in the country, according to the DPU, 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,” explains Matthew Beaton, Massachusetts’ secretary of energy and environmental affairs. “By balancing the importance of protecting our state’s natural resources while continuing to move towards a clean energy future, the commonwealth is positioned to continue significant solar development and growth.”
Notably, under the order, the DPU rejected the distribution companies’ proposal for a cap that would have limited the volume of bill credits that individual customers could receive under community solar projects. The department 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, according to the DPU.
“The SMART program tariff will provide more competitive incentives to solar developers and result in ratepayer savings compared to the existing solar incentive programs,” adds Angela O’Connor, chairman of the DPU. “As solar costs stabilize, it is essential that both solar customers and ratepayers yield continued benefits for this growing clean energy resource.”
In response to the order, several local solar advocacy groups are applauding the news.
“The release of the SMART order from the DPU, and the program’s implementation, will help get the Massachusetts solar market moving again,” says David Gahl, director of state affairs for the Northeast at the Solar Energy Industries Association. “Although we are still reviewing the order details, we are pleased to begin this new chapter.”
Janet Gail Besser, the Northeast Clean Energy Council’s executive vice president, says although the state has historically been “a national leader on solar,” Massachusetts’ industry “has slowed over the past two years.” Now, she says the order is “the critical step needed for solar to ramp up in the commonwealth again.”
Brandon Smithwood, policy director for the Coalition for Community Solar Access, brings up that the order “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.”
Sean Garren, senior director for the Northeast at Vote Solar, adds, “Solar projects have been stalled across the ommonwealth for more than a year now awaiting the launch of the SMART program, which will still be weeks from now. These projects will mean local investment, new jobs and property taxes, as well as a cleaner and more resilient energy system.”
“After many delays, this order from the DPU will help solar energy regain momentum across the Commonwealth,” notes 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.”