United States: MA Proposes Regulations To Expand In-State Solar Generation

On June 7, the Massachusetts Department of Energy Resources (DOER) presented two proposed sets of regulations designed to further transform the solar power market in the Commonwealth. The first proposal provides relief to solar project developers caught by surprise by DOER's announcement that it had reached the 400-megawatt (MW) cap for its existing Solar Carve-Out program. The second proposal creates a new solar incentives program designed to significantly increase solar generation in the Commonwealth while gradually reducing the incentives available to developers of that generation.

Relief under Existing Cap

As we reported on May 30, last month DOER announced the 400 MW cap for its Solar Carve-Out program had been reached much sooner than anticipated. Recognizing the cap had been reached much faster than expected, DOER acknowledged some solar developers have expended significant funds to develop solar projects in Massachusetts but now may not qualify under the existing Solar Carve-Out program, resulting in substantial loss of financial incentives for solar developers. In response, DOER announced its intent to accommodate within the Solar Carve-Out program those projects that are "demonstrably well invested in the development cycle" but have not yet received the Statement of Qualification necessary to participate in the program.

Who Qualifies?

All solar generation units greater than 100 kW in capacity that have already received a Statement of Qualification or have submitted a Statement of Qualification Application that has been deemed administratively complete by DOER will qualify under the existing Solar Carve-Out program, so long as those projects continue to meet their prescribed project construction timelines.

In addition, all solar generation units greater than 100 kW in capacity that currently fall beyond the 400 MW cap and possess an executed Interconnection Service Agreement with their local electric distribution company dated on or before June 7, 2013, may be provided a Statement of Qualification under the existing Solar Carve-Out program as projects that are "demonstrably well invested in the development cycle" but only if they meet the prescribed construction timelines described below. These market participants must provide DOER with that executed Interconnection Service Agreement no later than one week from the effective date of the emergency regulations (currently unknown) or their Statement of Qualification Application will be rejected.

Last, DOER acknowledged particular concern for the small solar (100 kW or less) market sector, which has a short project development cycle, and participants in that sector are at risk for business suspension if they do not qualify under the existing Solar Carve-Out. As a result, DOER announced that all solar generation units with a nameplate capacity of 100 kW or less that have an executed Authorization to Interconnect from the local distribution company and have submitted a Statement of Qualification application prior to the effective date of the post-400 MW Solar Carve-Out program regulation (DOER's aspirational goal is December 31, 2013) will be provided a Statement of Qualification under the exiting Solar Carve-Out program.

Project Construction Timeline

As discussed above, both generation units that have Statements of Qualification under the 400 MW cap and those seeking to obtain a Statement of Qualification under the existing Solar Carve-Out program by virtue of having an executed Interconnection Service Agreement dated on or before June 7 must meet the prescribed project construction timelines in order to receive the benefits of the Solar Carve-Out program. Projects must receive an Authorization to Interconnect from the distribution company on or before December 31, 2013. Projects that do not satisfy this deadline will be provided an extension to obtain an Authorization to Interconnect until March 31, 2014, but only if the project can demonstrate it has expended at least 50 percent of its total construction costs by December 31, 2013. Further, if a project can demonstrate either of the timelines above has been met but the project is awaiting the Authorization to Interconnect from the distribution company, and that authorization is delayed solely due to a distribution company, the Statement of Qualification will be extended indefinitely until that authorization is either received or denied.

What's Next?

In order to accommodate the number of projects that may qualify beyond the 400 MW Solar Carve-Out Program cap, DOER will increase the Solar Carve-Out compliance obligation for retail electric service providers from 400 MW total to the quantity of megawatts that ultimately qualifies under the Solar Carve-Out program as of April 1, 2014. DOER announced its intent to file the proposed emergency regulations as soon as possible, ideally no later than the end of June. By virtue of the "emergency" nature of those regulations, there will be no public hearing prior to that filing. Rather, a public hearing will be required upon the determination that these emergency regulations will be in effect for a period greater than 90 days, which is the likely outcome.

Post-400 MW Proposal

In furtherance of Governor Patrick's new goal of 1,600 MW of solar generation in the Commonwealth by 2020, DOER announced a new program to encourage steady, sustainable growth, ultimately driving the solar photovoltaic market toward cost parity with other Renewable Portfolio Standard (RPS) Class I generation technologies.

This proposed post-400 MW program (preliminarily dubbed SREC-II) will create a new, separate Solar Renewable Energy Credit (SREC) market with a corresponding compliance obligation for retail electricity suppliers and a separate Solar Credit Clearinghouse Auction. Unlike the existing Solar Carve-Out program, the financial incentives under SREC-II will adjust over time as the market grows. Further, SREC-II will differentiate incentives among solar market sectors and will establish a fixed term of 10 years for each project to be capable of producing SREC-IIs.

The most substantial change from the existing Solar Carve-out Program is the introduction of the concept of the "Adjusted SREC Factor." This Adjusted SREC Factor results in a mix of both SREC-IIs and RPS Class I RECs produced, representing each megawatt of solar generation by a project. The portion of each megawatt that results in SREC-IIs rather than Class I RECs is determined by the Adjusted SREC Factor. Each project will have the same Adjusted SREC Factor for the 10-year term of a project's participation in the SREC-II program. The Adjusted SREC Factor for new projects will decline gradually over time, using a formula that is based on the cumulative number of megawatts qualified for the SREC II program. The decline of the Adjusted SREC Factor is intended to be gradual in order to reduce financial uncertainty and avoid rapid market reactions. The Adjusted SREC Factor will additionally enable incentive differentiation across market sectors (small systems, projects located on landfills or brownfields, etc.) by providing different Adjusted SREC Factors to those sectors. DOER likely will reserve the discretion to adjust the SREC Factor to account for certain external market changes as well.

DOER plans to manage the SREC-II supply by limiting (quarterly or annually) the available megawatts of qualifications extended to certain market sectors (likely large ground-mounted arrays not located on landfills or brownfields). This managed supply will be competitively qualified based on criteria to be established by DOER, potentially including price and nonprice criteria (land use attributes, development timelines, local benefits, etc.). DOER expects this management of supply to enable a more accurate projection of SREC supply, which will allow for annual adjustment of the corresponding compliance obligation in order to better maintain market balance and avoid unfettered expansion and oversupply. Last, the alternative compliance payment (ACP) rate - the rate retail suppliers must pay for failure to obtain the requisite number of SRECs -- proposed for SREC-II will be substantially less than the one in place for the current Solar Carve - Out program ($375 vs. $523 in 2014).

As stated above, both the emergency regulations and the SREC-II program are currently only in proposal form, with no corresponding regulations yet available. Details of both may change as the Massachusetts solar marketplace continues to evolve. Day Pitney LLP will continue to stay abreast of the latest market developments and update our clients and friends.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions