Leveraging SMART to maximize solar value
As one of the leading clean energy initiatives in the U.S., the Massachusetts SMART (Solar Massachusetts Renewable Target) Solar Program incentivizes a wide array of solar installation types and sizes.
As you are making decisions about your solar deployment, it pays—literally—to understand how capacity and system typeaffect incentive-boosting opportunities under the SMARTMassachusetts solar incentive.
SMART aims to add 1,600 megawatts (MW) of solar power to Massachusetts, doubling the Bay State’s current capacity. While most people think of commercial solar projects as large rooftop installations, the SMART Massachusetts solar program incentives are structured to encourage smaller, non-rooftop systems as well.
Building-mounted rooftop panels are often the quickest to install.
Ground-mounted systems can be right-sized to capitalize on available space and are easy to maintain.
Carport systems are a great option if you have an open parking lot. Although materials can be more expensive, canopies allow you to transform a parking lot into a revenue-producing asset. Plus, solar carports visually showcase your commitment to clean energy.
SMART starts with a baseline
At the heart of SMART is a fixed incentive for the energy produced by solar installations, with the incentive rate based on energy produced. Compared to SRECs, whose value fluctuates on an open market, the Massachusetts SMART solar program incentive is steady and predictable.
Base Compensation Rates are specific to the utility and are set for a 20-year term. The 1,600 MW available to the program are divvied up between the three participating utilities—Eversource, National Grid and Unitil—with eight blocks per utility.
As SMART progresses, projects will be allocated into later and later blocks, with lower and lower Base Compensation Rates.
Base Compensation Rates were determined by a competitive auction and have been set at $0.17/kilowatt hour (kWh) for Eversource, $0.156/kWh for National Grid and $0.156/kWh for Unitil.
How incentives are calculated
SMART commercial solar incentives are calculated using a fixed Base Compensation Rate. Additional levels of compensation (including size multipliers and adders), minus the historical cost of energy, yields the per kilowatt (kW) incentive.
“Location” adders are built into SMART to encourage certain types of projects and boost incentives. They are targeted toward lower-impact installations, such as carports, on land that has already been developed. Conversely, subtractors discourage installations on pristine, undeveloped land, or land that is not zoned for commercial or industrial use.
SMART also encourages development of smaller-scale solar systems via “size multiplier” adders that can help level the economic playing field for smaller projects. For example, systems between 25 and 250 kW receive 150% of the baseline incentive. Adders are also available for public entities, low-income and community solar to encourage solar development.
Energy storage integration is the final adder. With a battery storage system, adders range between $0.025 to $0.076/kWh, depending on storage system size and how long the batteries can supply power.
A thorough site assessment from your solar provider can help ensure you are harnessing all your potential solar assets, including how multiple rooftop systems can be segmented to maximize incentives.
The SMART money moves fast
Because SMART is a declining block program, first movers reap the biggest incentives. As more solar projects enter the pipeline and progress towards the 1,600 MW program cap, the value of both baseline incentives and adders will fall by roughly 4% per block.
Unlike previous Massachusetts commercial solar incentives, projects must submit an executed Interconnection Services Agreement in order to begin the SMART application process. Additionally, to qualify for SMART, projects must show proof of site control and any special project permits that may be required.
Given the declining block structure and lead time, the SMART money rewards those who act now—not later—to lock in the best Massachusetts solar program incentives.
This post originally appeared on the SunPower Business Feed.