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Incentives for Renewable Energy and Energy Efficiency

Massachusetts

The state of Massachusetts offers a number of tax incentives for renewable energy systems, as well as energy efficiency programs.  

Alternative Energy and Energy Conservation Patent Exemption
Massachusetts offers both corporate and personal income tax deductions for any income received from the sale of or royalty income from a patent that is deemed beneficial for energy conservation or alternative energy development. The Commissioner of Energy Resources determines if a patent is eligible, and part of the criteria is that the patent be ". . . of economic value, practicable, and necessary." This deduction, if granted, may be used for five years after it is granted. This deduction is unique among all incentives identified in that it targets patents and not simply property that may be deducted from taxes. For more information, contact the Public Information Officer, Massachusetts Division of Energy Resources, by phone at (617) 727-4732 or visit the website at http://www.state.ma.us/doer.

Cape & Islands Self-Reliance Corporation - Home Energy Loan Program
Cape & Islands Self-Reliance Corporation provides low-interest loans for energy-related home improvements (including solar water heater and photovoltaic installations) under its Home Energy Loan Program. The financing is available in cooperation with Cape Cod Bank & Trust. Self-Reliance uses funds generated by its member-benefit programs to underwrite loans for energy-related home improvements for its members. The fixed interest rate for HELP loans is based on the 90-day U.S. Treasury Bill rate plus 2%.  

Requirements for participation are membership in Self-Reliance; the home must be occupied year-round; annual applicant income must not exceed $80,000; and applicant must meet credit approval standards at CCB&T. For more information contact Megan Amsler, Cape & Islands Self-Reliance, by phone at (508) 457-7679 or visit the website at http://www.reliance.org.

Energy Conservation Service
ECS is a State Program administered by the Massachusetts Division of Energy Resources. The ECS Program helps homeowners, building owners and tenants conserve energy by providing services to help them make their homes or buildings more energy-efficient either through the One-to-Four Unit Program or the Multifamily Building Program (for owners of buildings of five or more units). ECS Program services are provided to residential customers by their gas and electric utilities. The services available under the ECS Program include energy audits, demonstration material installation, bulk purchase service, appliance efficiency education service, technical assistance service, and post-installation inspections.

Energy Efficiency Programs
This program helps cities, towns and other public entities work with energy service companies to reduce energy costs with little or no up-front capital expenditure. EEP provides technical assistance for privately financed renovation projects and design review services for new construction projects. EEP clients' energy efficiency improvement projects are financed by third party energy service companies, which are repaid through the annual energy and water savings resulting from the efficiency measures. For more information, contact the Public Information Officer, Massachusetts Division of Energy Resources, by phone at (617) 727-4732 or visit the website at http://www.state.ma.us/doer.

Energy Star Homes Program

Grants for Energy Conservation Projects
The Energy Conservation Improvement Program (ECIP) provides grants to public schools to help cut energy costs. Grants fund eligible energy conservation projects identified through an energy audit provided by the Division of Energy Resources (DOER). Only one application is needed for a public school to apply for a free energy audit and to be placed in the queue for review of grant funding eligibility. For more information, contact the Public Information Officer, Massachusetts Division of Energy Resources, by phone at (617) 727-4732 or visit the website at http://www.state.ma.us/doer.

Hydropower-Property Tax Exemption
Hydropower facilities are exempt from local property tax for a period of twenty years from the date of completion of the construction of such facility, if construction of the facility commences after January 1, 1979. To qualify for this exemption, the owner of the plant must agree to pay the host community at least 5% of the plants gross income for the preceding calendar year in lieu of taxes.

Local Property Tax Exemption
A taxpayer who installs a solar or wind-powered system for heating or otherwise supplying the energy needs of his/her residence or business is eligible for an exemption from local property tax. The exemption is good for twenty years from the date of installation.

Massachusetts Technology Collaborative’s Renewable Energy Trust
The Renewable Energy Trust is supported through a system benefits charge with total funding of roughly $150 million over a five year period, with approximately $20 million per year for an undefined period beyond 2002. The Massachusetts Technology Park Corp (MTPC), a quasi-public research and development entity, is administering the fund with oversight and planning assistance from the State Division of Energy Resources (DOER) and an advisory board. The 2001-2002 operating plan calls for efforts to focus in the areas of green buildings, fuel cells, and wind development programs. The fund is also making grants to help municipalities cut pollution at waste-to-energy plants. For more information visit the website at http://www.mtpc.org/massrenew/.

Renewable Energy Equipment Sales Tax Exemption
This statute exempts from the state sales tax solar, wind, and heat pump systems and all related equipment. This exemption is limited to systems which will be used in an individual’s principal residence and is not available to commercial users. For more information, contact the Public Information Officer, Massachusetts Division of Energy Resources, by phone at (617) 727-4732 or visit the website at http://www.state.ma.us/doer.

Renewable Energy State Income Tax Credit
This statute, which was first enacted in 1979, provides a 15% credit against the state income tax for the cost of a renewable energy system (including installation) installed on an individual’s primary residence. The maximum limit to the credit is $1,000 and can be carried over in the case that the credit is greater than one’s income tax liability in one year. Eligible technologies include solar thermal, solar water and space heat, photovoltaics, wind, and hydro systems. For more information, contact the Public Information Officer, Massachusetts Division of Energy Resources, by phone at (617) 727-4732 or visit the website at http://www.state.ma.us/doer.

Solar and Wind Energy System Deduction
This statute allows corporations to deduct solar or wind system expenditures for space or water heating from their taxable income. Solar or wind powered devices are also exempt from the corporate excise tax for the length of their depreciation period. The qualifier is allowed to deduct from net income, for state tax purposes, any costs incurred from installing the unit, provided the installation is located in Massachusetts and is used exclusively in the trade or business of the corporation. For more information, contact the Public Information Officer, Massachusetts Division of Energy Resources, by phone at (617) 727-4732 or visit the website at http://www.state.ma.us/doer.

Solar and Wind Power Systems Excise Tax Exemption
This statute exempts solar and wind energy systems from the corporate excise tax for the length of the system’s depreciation period. Specifically "If the energy system is the kind of business property considered to be personal property and subject to the state excise, it is then exempt." The state excise tax in Massachusetts is applied at a rate of $7.00 per $1,000 of assessed valuation. For more information, contact the Public Information Officer, Massachusetts Division of Energy Resources, by phone at (617) 727-4732 or visit the website at http://www.state.ma.us/doer.

Utility-Sponsored Energy Efficiency and Conservation Programs

The following programs are sponsored by state utilities. Please check with your local utility for more information about energy efficiency and conservation programs in your service area.

Massachusetts Electric

For up-to-date information about energy efficiency and conservation programs offered through Massachusetts Electric, call 1-800-322-3223 or visit the website at http://www.masselectric.com.

Appliance Management Program: Special services are available to low income customers to help lower electric bills. For more information, contact your local Community Action agency, or Massachusetts Electric at 1-800-322-3223.

Energywise: The Energywise program offers insulation installation, water heating measures, light bulbs, lighting fixtures, and other energy conservation measures to qualifying electrically heated single family homes, apartments, and condominiums. Customers who live in non-electrically heated multi-family or condominium facilities of five or greater dwelling units are now eligible for lighting system upgrades and other electric efficiency measures. Call 1-800-244-6342 for more information.

Mass-Save: A free home energy analysis is available for all residential customers. A Mass-Save energy advisor will thoroughly examine a customer’s home and install up to $30 worth of energy and water-saving materials. You will receive a report detailing the energy-saving recommendations identified by the energy advisor. For larger buildings, a Multi-family Building Audit is also available. Call 1-800-632-8300.

Residential Lighting: This program provides our customers with the opportunity to purchase energy efficient bulbs at a discount price. These bulbs consume an average of 70% less energy and last up to 13 times longer than traditional light bulbs. By installing energy efficient, compact fluorescent lights in your home, you save energy and money and help the environment. Call 1-800-473-9150 information.

TumbleWash: The TumbleWash program offers a $50 rebate to customers who purchase a qualifying washing machine. Call 1-877-TumbleW (1-877-886-2539) for more information.

Western Massachusetts Electric

For up-to-date information about energy efficiency and conservation programs offered through Western Massachusetts Electric, call 1-800-286-2000 or visit the website at http://www.wmeco.com/index.asp.

Energy Savings Program: For income-eligible customers, WMECO offers its Energy Savings Program (ESP) at no cost to the customer. The program offers such cost-saving measures as air sealing to reduce drafts, insulation, lighting, lamp replacement, and sometimes a new refrigerator. For more information about this program, including income eligibility requirements, please call 1-800-789-2290.

Energy Star Incentives: WMECO offers a number of incentives through the Energy Star program. These incentives include the following:

• Free evaluation of home building plans. Staff will review building plans and provide recommendations on such energy saving techniques as passive solar site planning, energy efficient window options, insulation, air sealing, and ventilation choices.
• Lighting fixtures for your home. All Energy Star homes receive 10 free Energy Star lighting fixtures (up to $500). Call 1-800-835-2707 for details.
• Energy Star rated appliances. Customers who build an Energy Star home may also qualify for additional incentives when they choose Energy Star rated appliances. For a list of qualifying appliances call 1-800-835-2707.
• Energy Star home certification. WMECO will pay for the technical support and application needed to receive Environmental Protection Agency certification of your home.

Solar Panels: WMECO will provide and install pairs of SunSine solar panels at half the retail cost to a group of WMECO customers who own homes in western Massachusetts. Each system, which is comprised of two panels rated at 270 watts each, can be expected to produce about 750 kilowatt-hours of electricity annually. Customers who participate may pay their cost in one up-front payment of $2,600 or may finance it through their credit card. For more information and an application, please check out WMECO’s Solar Project Brochure (PDF: 749Kb) or call 1-888-269-0718.

TumbleWash: The TumbleWash program offers a $50 rebate to customers who purchase a qualifying washing machine. Call 1-877-TumbleW (1-877-886-2539) for more information.

NSTAR

For up-to-date information about energy efficiency and conservation programs offered through NSTAR, call 1-800-592-2000 or visit the website at http://www.nstaronline.com/.

TumbleWash: The TumbleWash program offers a $50 rebate to customers who purchase a qualifying washing machine. Call 1-877-TumbleW (1-877-886-2539) for more information.