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. The SMART program received another significant change in 2025 and was upgraded to SMART 3.0, with varying annual program capacity limits. The SMART 3.0 annual program capacity limits include a 15% minimum set-aside for Community Shared Solar Tariff Generation Units (CSTGUs).As part of the SMART program, 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 calculated as the base compensation rate plus any program adders, multiplied by the total kWh generated, minus the value of energy generated. Base compensation rates and adders are determined annually by the Department of Public Utilities. Any change in the base compensation rate (for units with a capacity between 25 kW and 5 MW) or the flat incentive rate (for units 25 kW or smaller), as well as any adder values, cannot exceed 20% of the same rate or adder category from the prior program year or $0.01/kWh, whichever is greater. The program's community shared solar adder is currently set at $0.07/kWh.