Massachusetts solar rebates and incentives: 2025 guide

Solar panel systems in Massachusetts are expensive, but incentives from the state and federal governments can help you reduce the upfront cost. Between the federal tax credit and state-specific incentives, you can save thousands on solar panels, making them well worth the investment. Here's how you can lower the cost of solar if you live in Massachusetts.

As a Massachusetts homeowner, you have access to some great incentives that can substantially improve your return on investing in solar panels. The three below are some of the most impactful ways to bring down your solar costs.

Residential Clean Energy Credit

The Residential Clean Energy Credit, formerly known as the federal investment tax credit (ITC), can reduce your solar panel system's cost by 30%. Your entire system qualifies for this incentive, including equipment, labor, permitting, and sales tax.

When you file your federal income taxes, you can claim this incentive as a credit towards your federal tax bill. Just keep in mind that to qualify for the ITC, you need to purchase your system either with cash or a solar loan–if you lease your system, you won't be eligible.

You also need a high enough tax bill, though you can roll over any remaining credit year-to-year until the end of 2034 when the ITC expires. The only time you might be eligible for a direct payment for the ITC is if you're a tax-exempt entity, like a nonprofit organization.

MA Residential Energy Credit

When it comes to clear cut state solar incentives, it doesn’t get a lot simpler than the MA Residential Energy Credit. If you live in MA, you'll get a credit worth 15% of your solar panel system cost, up to $1,000, towards your MA state income tax bill. The only catch is that your system has to be installed on your primary residence.

Solar Massachusetts Renewable Target (SMART)

Massachusetts introduced its SMART program in 2018 as a way to compensate solar owners for the electricity their systems generate after its solar renewable energy certificates (SREC) program reached capacity. Under the SMART program, Massachusetts paid Eversource, National Grid, and Unitil customers a fixed rate per kilowatt hour (kWh) of solar energy produced for 10 years. 

Due to the program's popularity, the available incentive capacity filled up fast. In 2023, Massachusetts announced that because of this low capacity and record-high electricity rates, most Massachusetts customers will receive either an extremely low monthly incentive payment or no payment at all. 

However, according to reporting from the Boston Globe, Massachusetts Energy Resources Commissioner Elizabeth Mahoney has said that "a new incentive program is in the works" to replace the SMART program and promote solar energy growth in the state. While there are still no updates on the new program, we’ll hopefully have news for you in 2025.

In the meantime, you may instead be eligible to participate in Massachusetts' Renewable Portfolio Standard (RPS) program to earn a small compensation. Or, if you add energy storage to your solar panel system, you'll still receive some compensation under the SMART program or local solar battery rebates.

In addition to the great rebates and incentives above, Massachusetts also offers tax exemptions for solar panel systems. The solar sales tax exemption ensures that you won't have to pay a sales tax on your system, while the solar property tax exemption means you don't need to pay a higher property tax for adding solar panels to your house.

If you connect your solar panel system to the grid, you can benefit from net metering, one of the best solar panel incentives available in Massachusetts. With net metering, you earn credits when you send excess electricity from your solar panels to the grid. When the sun isn't shining and you need to pull electricity from the grid, your utility will apply the credits to your bill. Net metering makes it so you will owe very little, or even nothing, on your electric bills with solar panels. 

A few municipal utilities in Massachusetts don't offer net metering, but all three regulated electric companies must support it for solar panel systems with inverters rated under 25 kW. Your actual solar panel system size could be a bit larger than 25 kW, but your inverter size must be below it based on the 2024 net metering revisions by the MA Department of Public Utilities. 

If you have a three-phase power supply (this will mostly be mid-sized businesses or large housing developments), net metering is supported for systems with inverter ratings between 26 and 60 kW. You no longer have a cap on how much excess energy you can send to the grid as long as your solar system is mainly used to power your home or business and received an interconnection agreement before January 1, 2021.

Learn more about Massachusetts net metering programs:

In addition to solar incentives, Massachusetts also offers some great battery incentive programs to bring down the price of energy storage. As we said before, unlike with a solar only system, you can earn some compensation through the SMART program if you also have a battery.

Mass Save also runs a demand response program called ConnectedSolutions. In this program, you allow your utility company access to your battery's stored energy from June through September, between 3-8 pm. In exchange, you'll receive $275 for every kW your utility company pulls from your battery during times when the grid is strained. If you participate, you'll qualify for 0% interest financing for your battery and you'll be locked into the program for five years. 

Some residential and municipal light companies offer battery storage incentives through the NextZero Connected Homes and NextZero Battery Programs. The Connected Homes Program offers $30 per month in the form of bill credits when you connect your battery and participate in peak events. It’s currently limited to Duracell and Emporia batteries, but you could also receive $5 to $10 per month for electric vehicles, chargers, electric water heaters, and a Wi-Fi thermostat. 

After enrolling your battery in the Connected Homes program, you qualify for the Battery Program offering a $100 per kWh rebate for sharing your battery’s capacity. This means a battery with a 15 kWh rated storage capacity would receive a $1,500 rebate. As of now, the Battery Program is also limited to Duracell and Emporia batteries.

Belmont Light customers can take advantage of a $500 rebate for battery installations when you submit the application within six months of installation. There is no system size restriction and the rebate will appear as a credit on your bill if approved. 

Ipswich residents can receive a $2,000 rebate for battery installations between 5 and 20 kWh. Your battery must be enrolled in the Connected Homes Program before applying for this rebate.

All batteries above 3 kWh in size are also eligible for the 30% federal tax credit.