Massachusetts Community Renewable Energy - Neighborhood Net Metering

The community renewable energy program in Massachusetts was first brought to legislation on July 2nd, 2008 through Chapter 169 of the Act of 2008 within Massachusetts' session laws. This Act introduced "neighborhood net metering" to Massachusetts, establishing the framework for community net metering projects. Neighborhood net metering is any Class I, II or III net metering facility serving 10 or more residential customers, served by a single distribution company and located within the customers' neighborhood. Net metering facility classification definitions may be found within the act here.

An important addition to neighborhood net metering comes from the Code of Massachusetts Regulations (CMR), 225 CMR 20.00. This code establishes the Solar Massachusetts Renewable Target (SMART) program, administered by the Department of Energy Resources and designed with the intention to expand statewide solar energy by 3200 MW. Updated July 10th of 2020, this program replaced Massachusetts' Solar Carve-Out I and II projects.

As part of the SMART program, Community Shared Solar Tariff Generation Units (CSTGUs) may receive incentive payments to assist in neighborhood net metering projects. CSTGUs are electricity generating units which use solar photovoltaics and provide electricity or bill credits to three or more customers. No more than 2 participants may receive bill credits in excess of those produced annually by 25 kW of nameplate AC capacity, nor will their ownership exceed 50% of the total capacity of the generation unit, except in the case the generation unit is smaller than 100 kW AC. SMART incentive payments are equal to the base compensation rate, plus program adders, minus a greenfield subtractor, multiplied by the total kWh generated, minus the value of energy generated. Base compensation rates are submitted for approval to electric utilities, and are not to exceed system ceiling rates. For systems between 1 and 5 MW, the ceiling rate is $0.17/kWh. For systems under 1 MW rated capacity, a rate factor is applied to the base compensation rate. The rate factors are as follows:

1. 0 - 25 kW AC systems (low-income): 230%
   
2. 0 - 25 kW AC systems: 200%
   
3. 25 - 250 kW AC systems: 150%
4. 250 - 500 kW AC systems: 125%
5. 500 - 1,000 kW AC systems: 110%
   

SMART program adders range from $0.02 - $0.06/kWh, with community solar adders being $0.05/kWh for regular systems and $0.06/kWh for low-income community solar projects. Greenfield subtractors relate to land use categorizations and can reduce incentive payments between $0.0005 - $0.001/kWh per acre.