Incentive data current as of March 2026. Federal credit information reflects the One Big Beautiful Bill Act, signed July 4, 2025. SMART 3.0 rates reflect the DOER Final Program Year 2026 Annual Report, published December 1, 2025.
Massachusetts doesn’t rely on a single large incentive to make solar work. It runs on layers.
A state income tax credit, two permanent tax exemptions, a tariff-based income program that pays you monthly for 10 years, full retail-rate net metering, and a utility-run battery payment program that turns storage into a revenue source.
Most states lost their strongest incentive when the federal residential tax credit expired at the end of 2025. Massachusetts felt that less than almost anywhere, because the state-level stack was already doing most of the financial heavy lifting.
This guide explains all active incentives available to Massachusetts homeowners in 2026, how each works, who qualifies, and what the limits are.
Find out what Massachusetts programs are available to you!
The Federal Credit Is Gone for Purchased Systems
The 30% Residential Clean Energy Credit (Section 25D) was terminated by the One Big Beautiful Bill Act for any system installed after December 31, 2025. If you buy or finance a solar system in 2026, there is no federal tax credit to claim.
If your system was fully installed and operational before that deadline, you can still claim the credit on your 2025 federal return using IRS Form 5695. Any unused portion carries forward.
One exception remains. Solar leases and power purchase agreements (PPAs) can still access federal incentives through Section 48E, the commercial Clean Electricity Investment Credit. In these arrangements, the solar company owns the system, claims the 30% credit, and may pass some of that value to you through lower monthly rates.
This credit remains available for qualifying systems placed in service through 2027, subject to federal sourcing and eligibility rules.
See our guide on how to get free solar panels in Massachusetts to learn more about how this changes the purchase vs. lease decision.
What Massachusetts Offers Instead: The Income Stack
Massachusetts doesn’t offer rebate checks or one-time subsidy programs. The value here comes from a combination of income, credits, and exemptions that layer on top of each other over the life of your system.
Here’s what’s available in 2026:
Incentive | Type | How It Works | Est. Value |
|---|---|---|---|
SMART 3.0 (225 CMR 28.00) | Monthly production income | $0.03/kWh flat rate, paid monthly for 20 years. Rate locked at enrollment. | ~$5,000–$8,000 over 20 years |
MA State Tax Credit (MGL Ch. 62, §6(d)) | State income tax credit | 15% of system cost, capped at $1,000. One-time. | $1,000 |
Sales Tax Exemption | Point-of-sale exemption | 100% exemption from MA’s 6.25% sales tax on solar equipment. | ~$1,750–$2,200 |
Property Tax Exemption | Annual tax exemption | 100% exemption on added home value from solar, for 20 years. | ~$300–$500/year |
Net Metering (220 CMR 18.00) | Utility bill credit | Full retail-rate credits for excess solar sent to the grid. | Varies by usage |
ConnectedSolutions (VPP) | Annual battery payment | $225–$275/kW per year (varies by utility) for dispatching stored energy during peak demand. | ~$1,000–$1,500/year |
For a look at how these incentives reduce the upfront cost of a system, see The Cost of Solar Panels in Massachusetts.
Find out what Massachusetts programs are available to you!
SMART 3.0: The Centerpiece of the Massachusetts Incentive Stack
The Solar Massachusetts Renewable Target program, governed under 225 CMR 28.00, is the single most distinctive solar incentive in the state. No other state runs anything quite like it.
How it works
SMART 3.0 pays solar system owners a fixed rate per kilowatt-hour for every unit of electricity their system produces, regardless of whether that electricity is consumed on-site or exported to the grid. For residential systems (25 kW AC or less), the current flat incentive rate is $0.03 per kWh, paid monthly by your utility for a 20-year term.
Section 28.13(1) of 225 CMR 28.00 states that all STGUs are eligible to receive compensation for 20 years from the Incentive Payment Effective Date, with rates fixed for the full term.
Some utility websites and older guides still reference a 10-year term, which applied under SMART 2.0. Under 3.0, the term is 20 years for all system sizes.
The rate you receive is locked at the time your system qualifies. It does not decline, adjust, or expire early. Payments come directly from your electric distribution company (Eversource, National Grid, or Unitil) by check or direct deposit.
This replaced the old declining-block model used under SMART 1.0 and 2.0 (225 CMR 20.00), where rates dropped as capacity blocks filled. Under 3.0, DOER sets rates annually through a published Program Year Report. The Final Program Year 2026 Report was released on December 1, 2025.
What SMART 3.0 pays in practice
For a typical 9 kW residential system producing around 10,800 kWh per year (based on Massachusetts’s 3.8–4.2 peak sun hours), the base SMART payment works out to roughly $324 per year, or about $6,480 over the full 20-year term.
That’s on top of net metering credits and any other savings. SMART income and net metering run at the same time, not as alternatives.
Adders that increase the rate
SMART 3.0 includes additional rate adders for qualifying system configurations:
- Energy storage adder: Systems paired with a battery qualify for an additional ~$0.04/kWh, calculated through an Energy Storage Multiplier based on battery capacity and discharge duration.
- Low-income adder: Qualifying low-income households receive a base rate of $0.06/kWh (double the standard residential rate), plus additional adders if paired with storage. A low-income system with a battery could earn up to ~$0.10/kWh.
- Building-mounted adder: An additional ~$0.03/kWh for rooftop installations.
Program Year 2026 capacity
DOER allocated 600 MW of capacity for Program Year 2026, which opened for applications on January 1, 2026. Program Year 2025 had 900 MW. Capacity is not unlimited. Once the annual block fills, new applicants wait for the next program year.
This is not a race against a deadline. It is a race for capacity. If you’re considering solar in Massachusetts, the enrollment timeline is worth paying attention to.
One important caveat for 2026
DOER is accepting applications and issuing Preliminary Statements of Qualification for PY2026. However, Final Statements of Qualification and incentive payments will not begin until the DPU approves the SMART 3.0 tariff, which is currently under review (Docket No. 25-175).
The DPU finalized its procedural schedule on February 3, 2026. If you apply now, your rate and capacity allocation are being secured, but actual payments will start once the tariff clears regulatory approval.
Paying Tax
SMART payments are taxable income. They are reported to the IRS and must be included on your federal and state returns. Any ROI projection that doesn’t account for income tax on SMART payments is overstating your net return.
This is one of the most commonly overlooked details in Massachusetts solar marketing. Factor it in.
Who qualifies
Your system must be interconnected with one of Massachusetts’s three investor-owned utilities: Eversource, National Grid, or Unitil.
Municipal Light Plant (MLP) customers are not eligible. About 40 municipalities, including Belmont, Braintree, Reading, and Taunton, are served by MLPs. If your utility is an MLP, SMART does not apply to you.
Massachusetts State Income Tax Credit
Massachusetts offers a state-level solar tax credit under MGL Chapter 62, §6(d). You can claim 15% of your total system cost, up to a maximum of $1,000, on your Massachusetts state income tax return. The system must be installed on your principal residence.
Any system costing $6,667 or more hits the cap. Most residential installations in Massachusetts exceed that figure, so in practice, this is a flat $1,000 credit for nearly every homeowner who installs solar.
The credit is non-refundable, meaning it reduces your tax liability but won’t generate a refund beyond what you owe. If your state tax bill is less than $1,000 in the year of installation, you can carry the unused portion forward for up to three years.
This credit applies to purchased and financed systems. It does not apply to leases or PPAs where a third party owns the equipment.
Sales Tax Exemption
Under MGL Chapter 64H, §6(dd), all solar energy equipment purchased for installation on your principal residence in Massachusetts is 100% exempt from the state’s 6.25% sales tax.
On a $28,000 system, that saves roughly $1,750 at the point of purchase. On a $35,000 system, it saves about $2,188. Your installer should reflect this in your quote. If you see sales tax on a solar proposal, ask for it to be removed.
This exemption is automatic. No application, no approval process, no funding cap.
Property Tax Exemption
Under Massachusetts General Laws Chapter 59, §5 (Clause 45), the added value a solar system brings to your home is 100% exempt from property taxes for 20 years from the date of installation.
Following the 2021 Climate Act amendments, the exemption applies to systems that are either 25 kW or less, or systems that produce no more than 125% of the annual electricity needs of the property. Most residential installations fall comfortably within those limits.
Solar panels increase home value. In most towns, that would mean a higher property tax bill. This exemption prevents that.
The savings depend on your local tax rate and your system’s assessed value, but for a system adding $15,000–$20,000 in home value, you’re typically avoiding $300–$500 per year in additional property taxes.
Unlike SMART income, property and sales tax exemptions are not taxable. They reduce your costs without creating a new tax obligation.
Net Metering in Massachusetts
All three investor-owned utilities in Massachusetts are required to offer net metering under G.L. c. 164, §§ 138–140 and 220 CMR 18.00. For residential solar systems, this is one of the most valuable ongoing benefits in the state.
How it works
When your solar system produces more electricity than your home uses at any given moment, the excess flows to the grid. Your utility credits you for that exported energy at or near the full retail rate.
At current Massachusetts electricity prices, that’s roughly $0.26–$0.33 per kWh, depending on your utility and rate class. A small number of non-bypassable charges are excluded from the credit, which is why the effective rate is typically 90–98% of the headline retail rate rather than exactly 100%.
Credits roll over month to month and do not expire. At the end of your 12-month billing cycle, any remaining surplus is paid out at a lower avoided-cost rate (roughly $0.03–$0.05/kWh).
That year-end payout is far less valuable than the monthly retail credit, which is why proper system sizing matters. You want to match your annual production to your annual consumption as closely as possible.
The 25 kW cap-exempt threshold
As of February 2025, residential solar systems up to 25 kW AC are classified as “cap exempt” under DPU Order 23-140-A. This means they automatically qualify for net metering without needing a cap allocation, even if their utility’s general net metering cap is full. Before this change, the cap-exempt threshold was 10 kW.
Larger residential systems (above 25 kW) can still participate in net metering, but they may need a cap allocation depending on their utility’s available capacity.
Grandfathering
Once your system is interconnected and approved for net metering, your terms are locked in for 25 years.
Even if Massachusetts changes its net metering rules in the future, your system keeps the credit structure that was in place when you enrolled. This is one of the strongest protections for solar homeowners in the country.
Net metering and SMART work together
This is a common point of confusion. SMART pays you for all the electricity your system produces. Net metering credits you for the electricity you export. They are separate programs, paid separately, and you benefit from both at the same time.
Utility-specific details
- Eversource: Serves eastern and central Massachusetts. Credits at roughly 90–98% of full retail (small non-bypassable charges are excluded).
- National Grid: Serves Greater Boston, Worcester, and Cape Cod areas. Full retail-rate credits. Annual surplus paid at wholesale.
- Unitil: Serves a smaller territory in north-central Massachusetts. Same net metering obligations as the larger utilities.
The MLP exception
Municipal Light Plants set their own rules. Some offer limited net metering, some offer none. If you’re an MLP customer, confirm your utility’s policy before moving forward with any solar quotes.
ConnectedSolutions: Turning a Battery into a Revenue Source
ConnectedSolutions is a demand response program run through Mass Save that pays homeowners with battery storage systems for sharing stored energy during periods of peak grid demand.
How it works
When you enroll a qualifying battery, your utility can dispatch stored energy from your system during high-demand events.
The bulk of these events happen in summer (June 1 through September 30), between 3 pm and 8 pm, with a maximum of 60 events per summer season and 3 hours per event. There is also a smaller winter season (December through March) with up to 5 events. You can opt out of individual events at any time.
In exchange, you receive an annual performance-based incentive. Rates differ by utility:
- National Grid: $275 per kW average, based on summer performance. National Grid reports enrolled customers earn an average of $1,500 per year.
- Eversource: $225 per kW for summer dispatch, plus $50 per kW for winter. A typical home battery contributing 5 kW per event would earn roughly $1,125–$1,375 per year, depending on performance.
The incentive rate is locked for your first five summers of enrollment. After that, rates may be adjusted based on regulatory review. Payments are made annually, typically in November.
What you need to participate
You need a qualifying battery system (Tesla Powerwall, Enphase IQ Battery, SolarEdge Home Battery, Franklin WH, and several others are approved), an active internet connection for dispatch communication, and electricity service from National Grid, Eversource, or Cape Light Compact.
Customers may also qualify for 0% financing on the battery itself through the Mass Save HEAT Loan programe.
Why this adds value to the incentive stack
ConnectedSolutions is not a solar incentive. It’s a battery incentive. But in Massachusetts, it changes the math on whether adding storage is worth the cost.
A battery system that earns $1,000–$1,500 per year in ConnectedSolutions payments, on top of SMART income and net metering savings, can pay for itself considerably faster than one used only for backup power. For more on how storage affects the overall value of a Massachusetts solar system, see Are Solar Panels Worth It in Massachusetts?
Find out what Massachusetts programs are available to you!
Programs That No Longer Apply
A few programs still appear in older guides and sales materials. For clarity:
✗ The federal 30% residential tax credit (Section 25D) expired December 31, 2025. It does not apply to any system installed in 2026 or later unless the system is third-party owned (lease/PPA) and qualifies under Section 48E.
✗ SREC (Solar Renewable Energy Certificate) program closed to new applicants in November 2018. Systems enrolled before that date continue earning SRECs, but new installations cannot access this program.
✗ MassCEC Mass Solar Loan program ended in 2020. Solar loans are still available through local banks and credit unions at market rates, but the subsidized loan program no longer exists.
✗ Massachusetts Solar for All (MASFA) was a planned low-income solar program backed by $156 million in federal funding. On August 7, 2025, the federal government cancelled the Solar for All program, and Massachusetts’s allocation was withdrawn. DOER has placed the program on pause until further notice.
Who Qualifies for Massachusetts Solar Incentives
Homeowners on investor-owned utilities
If you own your home and your electricity comes from Eversource, National Grid, or Unitil, you qualify for every incentive listed in this guide: SMART 3.0, the state tax credit, both tax exemptions, net metering, and ConnectedSolutions (with a qualifying battery).
MLP customers
If your utility is a Municipal Light Plant, your options are more limited. You can still claim the state income tax credit and benefit from the sales and property tax exemptions, but SMART and standard net metering do not apply. Check with your MLP directly for any local programs.
Renters and condo owners
If you don’t own your roof, community solar may be an option. SMART 3.0 includes provisions for community shared solar projects. You subscribe to a share of a larger system and receive credits on your bill.
Under the regulation, market-rate subscribers must receive at least a 20% discount on their bill credits, and low-income subscribers must receive at least 40%.
System size
Most residential incentives apply to systems of 25 kW AC or less. The SMART flat incentive rate ($0.03/kWh) is specific to this size category.
Systems above 25 kW qualify for SMART 3.0 under a different compensation structure with Base Compensation Rates that vary by capacity range. All SMART-qualified systems receive 20-year terms regardless of size.
Find out what Massachusetts programs are available to you!
What to Check Before Counting on Incentives
✓ Confirm your utility. SMART eligibility, net metering terms, and ConnectedSolutions access all depend on which utility serves your home. This is the single most important variable.
✓ Understand the tax implications. SMART income is taxable. The state tax credit is non-refundable. If your state tax liability is low, you may not capture the full $1,000 credit in year one (though you can carry it forward).
✓ Ask about SMART enrollment timing. Program Year 2026 capacity is 600 MW. Your installer should be able to tell you the current status of capacity and whether there’s any risk of missing the window.
✓ Size your system to match your usage. Net metering credits at year-end surplus rates ($0.03–$0.05/kWh) are worth a fraction of the retail rate. Oversizing wastes value.
✓ Factor in the battery question. ConnectedSolutions payments can turn a battery from a cost into a revenue stream. But the economics depend on your battery size, your utility, and whether you’re willing to have your stored energy dispatched during peak events.
Local installers familiar with SMART 3.0 enrollment and utility-specific interconnection processes can walk through how these programs apply to your home.
Comparing solar companies in Massachusetts is a good place to start.
How EcoGen America Can Help
Massachusetts has more incentive layers than most states, and the details matter. SMART 3.0 enrollment, utility-specific net metering rules, ConnectedSolutions eligibility, tax credit filing, and system sizing all affect what you actually save.
EcoGen America connects you with pre-vetted local installers in Massachusetts who understand these programs and can show you, line by line, what applies to your home. Quotes are free, with no obligation.
If you want to see how the numbers look for your property, start here.
Calculate your SMART 3.0 income stream
Frequently Asked Questions
Massachusetts does not have a statewide solar rebate program. The state’s incentive structure is built around tax credits, tax exemptions, production income (SMART), and utility bill credits (net metering) rather than upfront rebate cheques.
Some Municipal Light Plants, including Concord, Wakefield, and Braintree, offer their own local rebates, but these are limited to customers of those specific utilities.
For long-term value, SMART 3.0 and ConnectedSolutions together typically deliver more than any single incentive. Combined with net metering, the ongoing income and savings exceed what the federal credit used to provide for most homeowners.
No. SMART is available only through the three investor-owned utilities: Eversource, National Grid, and Unitil. Municipal Light Plant customers are not eligible. About 40 municipalities in Massachusetts are served by MLPs.
No. Under MGL Chapter 59, §5, Clause 45, the value your solar system adds to your home is exempt from property taxes for 20 years from installation. The exemption applies to systems that are 25 kW or less, or that produce no more than 125% of your property’s annual electricity needs. No application is required.
Sources & References
- DOER, 225 CMR 28.00: SMART 3.0 Program Regulations: mass.gov
- DOER, SMART 3.0 Program Details (including PY2026 Annual Report): mass.gov
- National Grid, ConnectedSolutions Battery Program: nationalgridus.com
- IRS, Section 25D Termination (OBBB Act): irs.gov
- DSIRE, Massachusetts Solar Programs: programs.dsireusa.org
- EIA, Massachusetts State Energy Profile: eia.gov
- MGL Ch. 62, §6(d), Massachusetts Residential Clean Energy Income Tax Credit (830 CMR 62.6.1): mass.gov
- MGL Ch. 59, §5 (Clause 45), Solar Energy Property Tax Exemption: malegislature.gov
- MGL Ch. 64H, §6(dd), Sales Tax Exemption for Solar Equipment: malegislature.gov
