solar systems

Solar PV Rebates & Incentives: Federal and State – MA, CT, RI

Renewable Energy is becoming increasingly popular among homeowners, small businesses and large corporations alike, especially with sky-rocketing energy costs. Solar PV (photo-voltaic) is by far the most popular renewable-energy technology, but despite such popularity, Solar is not economically feasible for most people without government support.

Solar PV technology has a huge potential to provide if not all, but a bigger chunk of US electricity, which at this moment comes mostly from fossil-fuels, such as Coal and Natural Gas, as well as some Nuclear and Hydro power. Still, fossil-fuels provide most of our ever-rising electricity demand. While gas and coal are relatively cheap compared to other energy sources, they are polluting our atmosphere with ‘green-house’ gases. Also, due to rising energy demand, the cost of gas, coal and oil keeps rising, with no end in sight in the near future.

Solar, on the other hand produces clean, ‘free’ energy in the form of electricity, heat, and light. Although benefits of solar are enormous, so is the initial capital investment, which without additional incentives becomes not so attractive to the end user. Fortunately, the US government, as well as many other governments throughout the world see great potential and need in renewable energy, and offer end-users financial rebates and incentives to promote the spread of renewable energy. This in turn, reduces the cost of such technologies.

Here we will review rebates and incentives offered by Federal, State and local governments, as well as utility companies and other organizations in Massachusetts, Connecticut and Rhode Island (Note: Due to the recent budget deficit and slow economic conditions in RI, most of the State-sponsored renewable-energy incentives are temporarily suspended – we will keep a close eye on the situation and post updates as they become available).

Federal Tax Rebates for Solar PV: Commercial and Residential

Commercial Rebates

The Federal Government offers a Tax rebate for solar and other renewable-energy installed on your building. You can claim 30% Business Energy Tax Credit in the year of installation, and a 5-year accelerated depreciation thereafter. No maximum cap for Solar PV, while other technologies may have a limit.

Residential Rebates

For residential Solar PV systems, the Federal Tax Credit is 30% percent with $2000 cap.

Note: Current Federal Tax Credits for renewable-energy are set to expire on December 31, 2008. Unless they are renewed before expiration, Tax credits will be reduced to 10%.

Currently, Big-Oil companies receive over $1.5 billion/year in Federal Tax Credits from the US government for oil exploration and drilling in the Gulf of Mexico. These same companies had over $130 billion profit (net income after all expenses and taxes paid) in 2007. This money can be used to the advantage of the people of the United States in the form of a Renewable Energy Bill, which President Bush promised to veto, if it passes in the senate. We urge you to call your Senator, State Representative, Governor, and other officials as well as Presidential Candidates, and tell them that we, the people, demand support for renewable-energy.

State Tax Rebates, Incentives and Grants for Solar PV

Each State has a different Solar Rebates and Incentives Program, and to eliminate any confusion, we list them under each state’s respective page. These programs are designed for residents and businesses located in each state to take advantage of all the great benefits of Renewable Energy, and to help out the environment.

Massachusetts State Tax Rebates, Incentives and Grants for Solar PV

In 2008, Governor Patrick’s administration passed a new Solar Electric Photo-voltaic Initiative for the Commonwealth, which includes Solar rebates for residential and commercial Solar PV installations, as well as rebates for other renewable-energy technologies. This new program will allocate $68 million over the next four years (2008 – 2011). Here is a brief summary of rebates for Residential and Non-Residential (Small and Large Commercial, Non-Profit and Government) solar PV systems.

List of Massachusetts residential solar rebates:

Type of Rebate $/Watt DC
Base Incentive $2.00/Watt
PLUS: Additional to Base Incentive
Mass. made system components $0.25/Watt
Moderate Home Value $1.25/Watt
Moderate Household Income
Option A: Less than or equal to $91,552 $1.00/Watt
Option B: Less than or equal to $76,296 $2.00/Watt
Maximum possible rebate


Moderate Home Value varies by county and ranges from $300,000 to $400,000. If your home value is equal to, or less-than your county’s Moderate Home Value (determined by municipality), you are eligible for this rebate.

County Moderate Home Value
Berkshire, Franklin, Hampden, and Hampshire $300,000
Bristol, Suffolk, and Worcester $350,000
Barnstable, Duke, Essex, Middlesex, Nantucket, Norfolk, and Plymouth $400,000

Massachusetts made system components: If any MAJOR component of your solar system was produced in MA, you are eligible for this rebate.

Official wording to qualify for this rebate adder:

To qualify for this adder, the Applicant must provide evidence that either the PV modules or the inverter(s), or another significant component are manufactured by a company with a significant Massachusetts presence as determined at the sole discretion of MTC and DOER. Current companies and products on this list are:

Evergreen Solar: modules

RWE Schott: modules

Satcon: inverters

Solectria Renewables: inverters

How to Calculate your Massachusetts Residential Solar Rebates:

For our example, we will use an imaginary Family – the Simpsons – living in the Bristol County of Massachusetts. Their home value is $279,000 as determined by their City’s Tax Collector Office. The Total Household Income is $90,000/year (which is above Mass. median household income of $76,296). The system consists of SolarWise PV and an Inverter manufactured in Mass.

They plan to install a 3 kW Solar PV system that costs $8 per watt. Total Cost of this system is $24,000 (3000 watts * $8)

They qualify for:

  • $2.00/watt – Base Rebate
  • $0.25/watt – Mass. made components adder
  • $1.25/watt – Moderate Home Value adder
  • $1.00/watt – Moderate Household Income adder
  • $4.50/watt Total Rebate ($13,500)

Their cost/watt is $3.50, and the total system cost is $10,500. They also qualify for a $2000 Federal Tax Credit, which reduces final cost to $8,500.

Now, their new system will generate an average of 4000 kWh per year. At an average cost of $0.19/kWh and assuming they will sell their REC (Renewable Energy Credits) for $0.06/kWh, this solar system will save the Simpsons $1000/year (~$83/month) in electricity costs, which they would have to spend anyway. At first, it seems like the pay-off period (or the ROI) is about 9 years. But if they finance that $8,500 with a 5-year Home Equity loan, with a 5% APR, their monthly payment would be $160.41. If we subtract the $83 reduction in electric bill from $160.41 we get $77.41 monthly loan payment for five years. After that, the new solar system will be paid off and will generate FREE electricity. Any reduction in the total system output (which is common with ALL solar modules, and for IB SolarWise PV it is about 1/2% per year or 10% over 20 year warranty period) is more than offset by the inflationary increases in electricity and energy sources’ costs.

Massachusetts Commercial and other Non-Residential Solar Rebates:

While total non-residential solar PV rebates in Massachusetts are less than those for residential solar, they still cover a major part of the total cost, and considering much more attractive federal tax credits, the ROI with any commercial solar PV system is higher than that of a residential one. Here we will not get onto complicated tax-related calculations, but bear in mind the 30% federal tax credit with no limitation, and the 5-year accelerated depreciation. With that you get the reduced electric bill and of course the state rebates. Bellow, is an overview of what you can qualify for.

Note: At this point, Federal tax credits for Solar PV on other renewable-energy technologies is set to expire on Dec. 31, 2008. We assume that once the presidential election is over, the Renewable-Energy Bill will be updated and renewed for another 8 years as was proposed in the 2008 Energy Bill, but never made it through the Senate. President Bush also said that he’d veto this bill if it passed the Senate vote. (PS, the bill passed in the House of Representatives, and was 1 vote short of passing in the Senate)

Non-Residential Rebates for Incremental Capacity ($/Watt DC)

Incremental Capacity: 1 – 25 kW > 25 to 100 kW > 100 to 200 kW > 200 to 500 kW
Base Incentive $3.25/W $2.50/W $2.00/W $1.50/W
PLUS: Additional to Base
Mass. made components $0.25/W $0.25/W $0.25/W $0.25/W
Public building adder $0.50/W $0.50/W $0.25/W $0.25/W

For more information, directions, and step-by-step guides, visit the Commonwealth Solar Program which cover all aspects related to this topic in great detail, and we based this article on the information from there.

You can also read the Mass. Solar Program Handbook which is a detailed summary of Mass. solar rebates for residential and non-residential installs.

Connecticut Solar PV Rebates Overview

– Section Coming Soon

Rhode Island Solar PV Rebates Overview

Apparently, due to an excessive budget deficit in RI, there are no renewable-energy rebates available at this time. This is very unfortunate, and we try to do anything we can (which is not a lot, as this matter is in the hands of RI policy makers) to bring those rebates back. To find out what is being done, and how you can contribute to these and other renewable-energy initiatives, visit Apeiron Institute – a group of volunteers and activists of Sustainable way of life in RI and surrounding areas.

If you live or do business in RI, you are paying a Renewable-Energy charge on your electric bill. Fight for your right to access a State-sponsored Solar PV rebates program, to which you and EVERY customer of electric companies in RI contributes every month. Yet, your money goes somewhere else, while the National ‘Greed’ keeps on hiking your electricity rates. Contact the RI Governor and the members of state senate and tell them you want the Renewable-Energy Program back!


With these incentives in place and their availability through 2011, it actually makes sense for any business to have a solar PV system installed on their roof, and even more so for public entities, such as schools, city/town halls, etc. For an average commercial installation, a state rebate will range from $2.75 to $3.50 per Watt DC, and considering that the initial cost for larger, commercial solar PV installations is less than that of a residential system, it is a bargain!

With IB SolarWise PV system, the cost/Watt scales down as you increase the system size. This happens because all you do is add more solar panels, and some labor to actually weld those panels to the main IB roof, while most of the labor is on the electrical side of the installation: Connecting all panels to the Inverter, installing power shut-offs, generation meter, and connecting the system to the building’s electrical system and the main eclectic meter. Also, bear in mind that the Inverter is already there, so when you add more panels to the system, you do not need to add inverters, which reduces total cost/Watt even more (of course you need an adequate size inverter).

Solar PV Guide: Prices, Design, Installation and Pay-off Period (ROI)

Solar Photo-voltaic (PV) technology is the way of the future, for generating and supplying electric power for homes and businesses in the US and across the world. Despite the great potential of Solar PV, current cost and efficiency of solar panels makes them a green, yet expensive alternative to conventional ways of generating electricity, such as Coal, Gas and Oil operated power plants, as well as Nuclear and Hydro electricity.

The main obstacle that is holding back the wide-spread of solar PV is the long ROI (return on investment), which in some situations may exceed 10 years. Fortunately, the US federal government and local and state governments have a multitude of incentives and rebate programs for solar and other renewable energy projects.

The Purpose of this Solar PV System Design Guide is to help you squeeze the most efficiency out of your home solar system, making it collect as much sunlight, as is available throughout the year.

Solar Guide Quick Navigation:

A rack-mounted Solar Photovoltaic system installed on a flat roof

rack-mounted solar panels on flat roof

Planning a Solar PV System for a Home or a Small Business

First and foremost – you need to figure out if your site can accommodate a solar pv array, so that it operates at or near its rated efficiency. If your site conditions (roof of your home or business, backyard, etc) will limit the electricity production even by 20-25% – everything else is irrelevant, and solar is probably not for you.

Step 1 – Determining if Your Site Can Accommodate a Solar Photovoltaic System

Southern Exposure: Solar PV systems operate by converting sunlight into electricity, so the first thing they require is enough light throughout the day and year, with as little obstruction or shading as possible. If you plan to use a solar system that will be fixed (usually a roof mounted solar array), you will need to position it so that it faces South. In this case, your solar PV system will collect as much sunlight as possible, as the sun will move from East to West.

Shading: Throughout the year, the sun is positioned very differently, depending on the season – in the summer the sun is up high and in the winter it is very low. You need to consider this, as this issue has the potential to make your system very inefficient. Solar Pathfinder is used by solar professionals to determine the position of the sun during the year and to find any shading that will obstruct the sunlight to the Solar PV Panels. By using a pathfinder, you could determine whether it makes sense to have a solar system installed at your location, and if you would need to remove some of the shading – eg. cut down some trees or move your neighbor’s house 20 feet to the left :).

It is unlikely that a homeowner will have a Solar Pathfinder handy, but using just common sense, you can get a good idea if you have too much shading, or if your location is perfect for the installation of a Solar PV system.

Angle or slope for solar panels: Depending on where you live or plan to install your solar system, an angle or incline of the panels may have a significant effect on electricity production. Here in New England the sun is at about 20 degrees to the earth surface and at about 45-50 degrees during the summer. If you plan to have a fixed solar system installed in MA or at a similar longitude, an ideal angle for your panels would be 30-32 degrees. Down south, the sun is higher in the sky, so it is better to lower the angle of the solar panels. At the equator, solar panels can lay flat on the ground and will get the maximum electricity production. At the north or the south pole, they should stand up vertically.

Size of your roof: If you plan to have a ground-mounted solar system, this will be irrelevant, as there is usually enough room to have a decent size system installed. If, like most other people, you plan to have solar panels installed on your roof, depending on the number of Kilowatts you plan your future solar system to produce, you may need a considerable roof area. If you have a large roof and you are thinking about a metal roof, a Roof-Integrated Solar PV System, a standing seam metal roof with Uni-solar panels is a very good choice. It provides a long lasting roof and slick-looking yet efficient amorphous-silicon thin-film solar panels. These babies require more space to produce the same amount of electric power, but are a better choice from the perspective of roof / solar system longevity and integration.

Lets assume that now you have performed a site inspection and determined that it would make sense to have a solar system installed. Maybe you will have to trim some trees, but over all, you have a decent size south facing roof with a good 35 degrees angle, and none or very little shading going from east to west.

Example of a solar PV system integrated into a flat roofing system:

Step 2 – Figuring Out the Size (in Watts) of Your Solar PV System:

This will surprise many people, but solar PV systems are priced in Watts or Kw – NOT in Sq. Ft.

Every second person calling us about a Solar Roof, asks me: “How much is solar per square foot?”. The truth is – I cannot answer this question and frankly, no one can. The question itself is wrong, but here is the right answer: The cost of solar will be determined by the system size measured in KW. Here, I will explain how many kilowatts of solar you may need or want, and below you can find out how much it will cost.

How many Kilowatts do I need? – This is actually simple, but pay attention to the theory behind it all.

Electricity production of your solar system depends on how many “sun-hour-days” you have in your area. In Massachusetts and surrounding states (Connecticut, Rhode Island, Southern NY) we have an average of 4.2 – 4.5 hours of sunlight (sun hours) per day annually. This accounts for rainy and cloudy days, as well as long, sunny summer days and short winter days.

Most households in the US consume on average 750 kWh (kilowatt-hours) per month. Assuming a 4.5 sun-hour-day in your area, 1 Kilowatt solar pv system should produce 4.5 kilowatt-hours of DC electricity per day. Per month, it will produce 135 kWh DC. Now, this DC electric current has to be converted to AC, so that your home appliances could use it. An inverter takes care of this part, as well as making your solar panels work at optimal production. However, as any electrical device it has resistance, so there will be power losses. An average modern inverter loses 3% of electricity due to resistance, while total power loss can be as much as 7-10% or more, depending on how well or poorly your system was designed.

Basically, to become completely independent from your Utility company you will need to produce about 750 kWh of AC electricity. With 4.5 sun-hour-days you will need 6 kW solar PV array (5.83 kW to be exact, but bear in mind that this is all relative), which is optimally designed and is placed in an optimal location – no shading, perfect angle, etc. This is the best case scenario.

So what size solar system will YOU need?

When considering installing a Solar PV system, you as home or business owner will need to know the future size of your solar system in kW ( 1 kilo watt is 1000 watts) and the cost associated with this solar system. You also need to establish your current annual electricity usage and decide if you want to reduce or completely eliminate the use of electricity that you purchase from your utility company.

First, gather your electric bills for the last 12 months, record your total electricity consumption – the number of kW-hours, and the total amount you had to pay, excluding any late fees and other miscellaneous fees. Divide your total cost by the total number of kWh – this will give you the real cost per kWh.

In Massachusetts, the average cost of electricity for residential use is 19-24 cents per kWh, and 15-17 cents per kWh for commercial use.

Designing a Solar PV system, tailored for your need

Assuming the 4.5 hours of sun per day, a 1 kW Solar PV system will produce 4.5 kWh per day, and 135 kWh in a 30-day month (4.5 x 30 days). Please keep in mind that the energy produced is in DC volts, and when it goes through the conversion into AC, you lose about 20-25% of that electricity.

Average household electric consumption is 750 kWh per month for a single family home. To cover 100% of this consumption with solar electricity, you will need about 8 kW solar PV system. 135 kWh DC x 8 = 1080 kWh – 10% = 972 kWh AC at 100% production output of solar panel. Note that ALL solar panels loose an average of 0.5% of production output per year, or 10 % through its 20-year warranty period.

Average residential solar installation is 2-4 kW system which usually eliminates 50-70% of electric power that you purchase. However, those installations are still dependent on additional electricity.

Commercial solar installations can range from 10 kW to over 1 MW (1 megawatt = 1000 kW). Commercial Solar PV systems can supply power to the building they are installed on, or they may be a so called solar farm – or a solar power plant supplying electric power directly into the electric grid. For the purposes of this guide, we will concentrate on smaller, roof-top solar installations for individual home or business use, as the topic of solar farms goes way beyond the scope of this guide, and is considered a power utility for taxes and other purposes.

Step 3 – How to Choose Equipment for Your Solar System:

This is the most difficult part, as there is no right answer to this question. However, there is a general guideline to follow, which will help you choose the longest-lasting and best performing solar panels, inverter(s), control units, production monitors, etc.

We will pretend that we are designing a 3 KW solar system for residential installation, in Massachusetts. Some of the variables will be different for your state, but this will be a good reference point for you.

Basic metrics for choosing solar equipment (or any electronic equipment for that matter) is such that you don’t want to be an early adapter. You want to buy a 2nd or even 3rd generation stuff (inverter for example), which is a very safe bet that all the bugs of first / second generations were worked out and the equipment performs at maximum efficiency. You also want to get UL rated equipment, or your electrical inspector will never sign off on the permits. A good example of such an inverter is the Sunny Boy 2500, which is a 3rd generation, tried and true work horse which also offers one of the best expandability and efficiency. This is not to say that other inverters are bad – you should use the 2nd/3rd generation metric and do your due diligence.

You also need to keep in mind that the average lifespan of an inverter is 7-10 years, while it’s cost is up there (on average you can expect to pay just under $1 per watt of the inverter’s capacity). If you plan for a big solar system, it is better to have many smaller inverters, than one big inverter. If a small inverter dies, others are still performing, and your system is only partially down, and it is a LOT cheaper to replace one $3000 unit, out of 5, than one $15,000 unit.

For our hypothetical solar system, we will choose one of the more simple inverters from Sunny Boy, rated at 3000 or 3500 watts. There is never an exact number of watts produced, and in the first year, your Solar system WILL produce about 10% more than its rated capacity. You want to utilize that and also don’t want to “overload” your inverter: this is a little confusing – an inverter will only accept as much electricity as it’s rated capacity – not more, so anything extra will just disappear.

A slightly larger inverter will allow for some future expansion of your solar system.

Cost of Solar PV Systems:

The national average cost to install a Solar PV system ranges from $9 to $12 per watt or $9000-12000 per kW DC (direct current) of solar system installed, with smaller installations being at the top of this price range, due to fixed costs such as equipment, setup, installation, permits and paperwork.

The most expensive components of the solar PV system are the solar panels themselves, however equipment such as an inverter (which converts DC into AC and feeds it into your meter) also add a considerable amount to a smaller size PV systems. Therefore, for a 3 kW residential solar system, the cost will be around $11 per watt or $33000 total system cost when using conventional solar panels.

Fortunately the $33000 price tag is not your actual cost, as many states have a wide range of rebates for solar PV installations as well as federal tax credits, available for both commercial and residential systems.

ROI and pay-off period for Solar PV

For the purposes of this guide, we will use two hypothetical solar PV systems – one being a 4 kW residential system and the other being a 25 kW commercial system. To simplify this guide and to avoid any confusion, both of those systems are installed in Massachusetts. This way we know exactly what the MA state rebates are for each system and what the local electricity costs are from N-Star and National Grid utility companies. These two utility companies have the widest presence in MA market.