The Solar Massachusetts Renewable Target Program Works. Here’s Why

March 9, 2021 - pv-magazine-usa.com - Tools deployed by the state as well as the underlying contract structure have created a program that local business and homeowners can grasp, and are investing in. The Massachusetts Department of Energy and Resources (DOER) was tasked with replacing its highly successful Solar Renewable Energy Certificate I & II programs five years ago. After a couple of band-aid extensions that allowed the SREC II program to continue, in late 2018 the agency launched the Solar Massachusetts Renewable Target (SMART) program.

The program has a broad goal of deploying 1.6 GWac (later upped to 3.2 GWac) of solar power in such a way that it is financially sound for electricity ratepayers. Project siting, economic justice, and energy storage all were considered in the equation of constructing this solar capacity.

In the field experience of this solar developer, and many others based upon demand shortly after the new program was released, the tools deployed by DOER and the underlying contract structure have created a program that local business and homeowners can grasp, and are investing in.

Let's see what makes it work.

The program path within SMART that appeals most to local bankers is the Alternative On Bill Credit (AOBC) + Wholesale Power Purchase Agreement (PPA). This program is specifically designed for standalone solar projects that will sell all their electricity to the local utility.

In practice, the project owner signs two 20-year contracts – the ABOC and the PPA – with the state and the electric utility, respectively. The independently metered solar project begins to pay the owner via one direct deposit and one check per month about four months after the project switches on.

If the AOBC program within SMART sounds familiar, that’s because it shares a few aspects with Rhode Island’s REGrowth program. The key similarities are:

● Standalone solar project
● Long term, fixed value contract
● High credit off taker (electricity utility), backed by the state.

Of course, the project’s return on investment matters as well. At a high level, Massachusetts has done a good job pricing incentive to motivate local installations. However, determining ROIs requires a bit of alchemy—combining the data of project size, utility load zone, capacity installed already, additions of energy storage and agrivoltaics, siting rules, and system efficiency—into spreadsheets. Programs of this nature that maximize roofs with high-quality off takers are why Rhode Island and Massachusetts have significant rooftop, and distribution level, volumes of solar power deployed. In particular, Massachusetts produces nearly 20% of its electricity from solar. That speaks volumes about the political support it receives.

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