That’s SMART: Massachusetts solicits 100 MW of solar under new program

After more than a year of negotiations, input and intense lobbying from solar advocates, the Bay State is requesting bids to build the first 100 MW of new solar projects under the state’s new SMART program.

November 15, 2017 Frank Andorka

Image: Government of the Commonwealth of Massachusetts

For the first time since regulators started designing the program in 2016, Massachusetts will finally get a chance to see how SMART regulators were in their efforts to keep the Bay State’s nascent solar industry growing.

The Solar Massachusetts Renewable Target (SMART) program, which replaces Massachusetts’ successful solar renewable energy credits (SREC) program, is a multifaceted set of incentives including a declining block grant incentive paid on a per kilowatt-hour basis.

And now the state has made its first request for proposal (RFP) under the new system – a call for project bids to total 100 MW of new solar capacity. Starting on November 27, applications will be accepted for this first block of projects, with an application deadline of December 5. The results will set compensation rates for the new program and will be announced no later than January 11.

“With the movement away from SRECs to long-term fixed price contracts, the SMART program is substantially reducing longer term revenue risk in solar projects,” said Tony Clifford, chief development officer of Standard Solar, a leading solar energy company specializing in the development and financing of solar electric systems nationwide. “This risk reduction will make Massachusetts solar projects easier to finance.”

“We’re looking forward to seeing the resulting incentive levels under the new program. We think this will help the solar industry continue to grow in the state.”

Under the SREC program, Massachusetts installed 1,600 MW of solar, so when Gov. Charlie Baker came into office in 2015, he had the unenviable task of trying to keep such explosive growth going while reforming the previous incentives. After extensive consultation with stakeholders across the spectrum, Baker’s administration designed the SMART program, which the governor believes will generate 1,600 MW more in solar development – doubling the current installed capacity in the state.

SMART will pay rooftop solar customers incentives as a declining block “adder” combined with the state’s net metering program. Initial prices are set by auctions such as the 100 MW solicitation, with a multiplier for smaller projects. The program also provides specific rates for projects on landfills, brownfields and solar canopy structures that the state feels are particularly important to encourage. In the latest program design, caps on individual adder categories were eliminated.

The new program encourages solar projects 5 MW and smaller, with strict regulations in place to avoid larger projects being built in multiples of 5 MW. Such system-gaming has been a problem in other states with similar programs and has led to utility pushback in those states.

The Solar Energy Industries Association (SEIA) applauded the plan but highlighted what it sees as a related issue that could still scuttle solar growth in Massachusetts.
“This week’s RFP announcement is another step in the transition from SREC II incentive program to the new SMART,” said Dave Gahl, SEIA’s director of state affairs for the Northeast.

“Getting this right will be critical to maintaining Massachusetts strong foundation as a solar leader in the United States. However, it’s also essential that the governor and legislature act to raise net metering caps to continue solar growth and protect the more than 15,000 solar jobs in the Commonwealth.”

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