A few days ago, the Massachusetts Department of Energy Resources announced that it has approved the extension to the Solar Renewable Energy Credit (SREC II) program.

This solar tax credit program was granted an extension due to the fact that the goal of 1,600 MW of solar power had been reached.  Massachusetts did not want to lose out on months of solar power development before another program was initiated. The idea behind the extension is that the program will act as a placeholder until a more permanent, renewable energy solution is developed.

This news is significant to those who support the movement towards more renewable energies including the Solar Energy Association of New England (SEABANE). “Over the years, Massachusetts has done a marvelous job encouraging an emerging solar industry, creating thousands of jobs, and helping to put clean energy resources into the hands of mainstream people and local businesses,” said Bill Stilling, SEBANE president. “The SREC 2 extension announced today avoids a major market disruption and continues our state’s progress toward a clean energy future.”

What is SREC 2?

This program is an initiative promoted by the Department of Energy and Environmental Affairs in Massachusetts. Its purpose is to assist in the development of new solar power capacity throughout the state.

The initial phase of the program started on April 25, 2014. The idea was that the program would continue to support the solar power market as well as non-profit, commercial, public, residential and commercial organizations and individuals until 1,600 MW of solar power capacity had been installed.

SREC 2 Program Details

Prior to the extension, the program provided the state of Massachusetts with a successful solar power initiative. The results speak for themselves. With over 1,600 MW of solar power generated, the program has created significant investment opportunities. In turn, this has generated plenty of employment opportunities for the state.

In general, SREC 2 aims to:

  • Focus on financial limitations that non-profits and residential consumers face
  • Manage cost for ratepayers
  • Provide statewide assistance to increase solar installations
  • Generate the right market conditions to support solar power developers
  • Generate flexibility and decrease regulatory complications surrounding solar power generation

SREC 2 Application Details

Those that wish to benefit from SREC 2 need to have solar photovoltaic (PV) generation units that meet particular standards. The Department of Energy and Environmental Affairs has outlined and defined these standards, some of which include:

  • 6 MW DC capacity or less
  • Generate some power onsite
  • Interconnect to the utility’s grid
  • January 1, 2013 (or later) Commercial Operation Date
  • Interconnect to Massachusetts’ distribution system

Net Metering Caps

Organizations and individuals who generate their own electricity via solar power systems can use some of that energy themselves. However, net metering caps define or limit how much of their generated solar power electricity they can consume.

The extension of this program also highlighted the need to address net metering caps. Many believe that Massachusetts utility’s net metering caps require an increase.

“The solar industry applauds Massachusetts Governor Baker and the Department of Energy Resources, led by Commissioner Judith Judson, for their efforts to extend the Solar Renewable Energy Credit 2 program,” said Sean Gallagher, Vice President of State Affairs at the Solar Energy Industries Association. “With this extension now on the books, we are asking the Baker Administration and lawmakers to support an increase to the Commonwealth’s net metering caps. We look forward to working with the Legislature and the Governor to enact legislation raising the caps this year.”