Massachusetts Solar Incentives, Tax Credits and Rebates
Financial resources to make solar panels more affordable in 2026
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The federal solar tax credit has been phased out for new residential systems as of 2026. On the bright side, Massachusetts has several solar incentives, including performance payments, rebates and tax breaks.
Before any incentives, typical residential solar panel installation costs $22,557 in Massachusetts.
Jump to insightHudson Light & Power, Reading Municipal Light Department and other utility companies offer solar rebates.
Jump to insightThe Solar Massachusetts Renewable Target (SMART) Program pays solar system owners for the electricity their panels produce.
Jump to insightWith net metering, homeowners with solar panels earn bill credits for the extra electricity they send to the grid.
Jump to insightResidential solar incentives in Massachusetts
Massachusetts offers several solar incentives, including rebates, tax breaks and performance-based payments.
Solar rebates
Some Massachusetts towns offer rebates through local utilities. Always check with your local provider for the most up-to-date information.
| Utility or program | Rebate amount | Details |
|---|---|---|
| Concord Municipal Light Plant (CMLP) | Up to $3,125 | Available to local customers installing solar |
| Reading Municipal Light Department (RMLD) | Up to $12,000 | Covers up to 50% of installation costs (pre-tax) |
| Ipswich Electric Light Department | Up to $3,000 | Applies to residential solar PV systems |
| Hingham Municipal Lighting Plant | Up to $6,000 | Local rebate for qualifying solar installations |
| Hudson Light & Power | Up to $7,500 | Pays $1.20 per watt; capped at 50% of project cost; customers retain RECs |
Solar tax incentives
Massachusetts also offers solar tax benefits:
- Sales tax exemption: Solar equipment is 100% exempt from state sales tax
- State tax credit: Solar systems are eligible for a 15% tax credit, up to $1,000
- Property tax exemption: Solar systems are 100% exempt from property taxes for 20 years
Performance-based solar incentives
The SMART (Solar Massachusetts Renewable Target) program pays you for the electricity your solar panels produce. It provides ongoing income from your solar system, helping offset the upfront cost over time.
You earn a fixed payment for every kilowatt-hour (kWh) your system generates. Payments come from your utility (Eversource, National Grid or Unitil). Residential systems receive payments for up to 20 years.
Net metering
Net metering lets you earn bill credits for extra solar energy, which lowers your future electric bills.
With net metering, your panels power your home first. If your system produces more electricity than you need, the excess goes to the grid. Then your utility applies credits to your electric bill.
Generating more power than a household consumes essentially turns the utility meter backward. Because her array was designed to cover “110% of my energy use,” Lori in Massachusetts is able to “accumulate credits over time” to offset future winter usage.
What to know about net metering in Massachusetts
People sometimes assume all utilities must offer net metering. In Massachusetts, it is required only for investor-owned utilities, while municipal utilities can choose whether to participate. Here are the other important details to keep in mind:
- Credits usually roll over to future bills
- Some customers can transfer credits to another account
- Most homeowners don’t get cash, only bill credits
- Credit value may be slightly below the retail rate (some earn about 60%)
SMART vs. net metering
Think of it this way: Net metering lowers your electric bill. SMART sends you extra money (or bill credits) for your total production.
You can take advantage of both to maximize solar savings. Under the latest 2026 SMART rules, adding a battery is the most effective way to maximize the stack.
» EXPLORE: Where solar savings go the furthest
Solar panel costs in Massachusetts
Average solar panel costs in Massachusetts generally start between $15,447 and $30,893.
System size is a big cost factor of going solar. A typical Massachusetts household needs about a 7.3 kW system, which costs $22,557 on average. Depending on your energy needs, you might need a smaller or larger system.
Your total price also depends on whether you add battery storage to your system. Solar batteries cost $7,000 to $18,000, which can nearly double the total system price.
Average solar panel costs by system size in Massachusetts
| 5 kW | 6 kW | 7 kW | 8 kW | 9 kW | 10 kW | |
|---|---|---|---|---|---|---|
| Statewide average | $15,447 | $18,536 | $21,625 | $24,715 | $27,804 | $30,893 |
| Boston | $16,086 | $19,303 | $22,521 | $25,738 | $28,955 | $32,172 |
Solar loan programs in Massachusetts
Solar loan programs help reduce upfront costs by letting you finance your system and pay it off over time.
- Holyoke Gas & Electric (HG&E) Residential Energy Assistance Program offers 0% interest loans for solar and energy upgrades, typically up to $10,000 for single-family homes, repaid through utility bills.
- PACE financing allows property owners to finance solar and energy upgrades through property tax assessments over time (typically up to 20 years; mostly for commercial properties).
Federal solar loan programs
Energy Efficient Mortgages allow homeowners to finance energy-saving upgrades, including solar systems, as part of their mortgage, often with support from federal programs like FHA or VA.
Types of Energy Efficient Mortgages
- FHA Energy Efficient Mortgages are available to many homebuyers. This lets you add money to your mortgage for energy upgrades. The upgrade cost must be less than the expected energy savings, and a home energy assessment is required first.
- VA Energy Efficient Mortgages are available to military members, veterans and reservists. This lets you add up to $6,000 if energy savings justify the cost.
- Conventional Energy Efficient Mortgages are offered by private lenders (not government-backed). You can borrow up to 15% of a home’s value for energy upgrades. This may help borrowers qualify by adjusting debt-to-income rules.
Compare solar companies in Massachusetts
Working with a local solar company in Massachusetts makes it easier to understand local incentives.
| Company | Customer rating | Pro install | Max. panel efficiency | Panel warranty | Payment options | Year founded | |
|---|---|---|---|---|---|---|---|
 Sunrun | Get Started | 4.3 |  | 22% | 20 years | Cash, loan, lease | 2007 |
 Earthlight Solar & Energy Solutions | Learn More | 4.7 | | Varies | Varies | Cash, loan, lease | 2008 |
 Freedom Forever | Learn More | 3.9 | | Varies | 25 years | Cash, loan, lease | 2011 |
Find solar companies in your city
FAQ
What happened to the federal solar tax credit?
The federal solar investment tax credit (ITC) previously let homeowners deduct 30% of installation costs from their federal taxes. It was phased out with the “One Big Beautiful Bill Act” (OBBBA) in 2025.
Homeowners who installed solar systems before the deadline may still claim the credit, but systems installed in 2026 or later no longer qualify.
Are there any commercial solar incentives in Massachusetts?
The Bay State also has a few commercial solar incentives, including:
- Green Communities Grant Program: Provides funding for solar and energy projects in designated “Green Communities” (nearly 300 communities have received the designation)
- Reading Municipal Light Department (RMLD): Provides $600 per kW installed, covering up to 50% of costs or $60,000 (preapproval required)
Are there any incentives for homeowners to add solar storage batteries in Massachusetts?
Yes, Massachusetts has rebates and performance-based incentives for battery storage.
» EXPLORE: Solar incentives by state
Are solar panels worth it in Massachusetts?
Going solar is often worth it for many Massachusetts homeowners for the long-term savings on utility bills. Over 25 years, residents with solar panels avoid $155,464 in utility costs on average.
Your current electric bill is the starting point for assessing the financial benefits of transitioning to solar energy. Your average energy consumption tells you what size solar system you need. Once you know this, you can figure out potential savings and how long it should take for your solar installation to pay for itself.
» COMPARE: Best solar companies
How can I pay for solar panels?
Going solar is like buying a car. You could pay cash, but a lot of people finance or lease with minimal upfront costs.
- Solar loans work like any other home improvement loan. There’s an application and approval process. You pay it back over time (with interest) each month.
- Leasing solar panels lets you set up a system without high upfront costs. A solar company installs and maintains the panels on your property, and you pay a monthly fee to use them.
» SOLAR PANELS: Lease vs. buy
Is my house a good candidate for solar?
Solar panels work best on large, unshaded roofs that face south or west. We suggest using NREL’s PVWatts Calculator to estimate how much electricity a solar panel can produce over a year on your house.
The condition of your roof matters too — if it needs replacement soon, do that before installing solar panels. Installing solar panels on an old roof might mean you have to remove the panels, replace your roof and then reinstall the panels. This will cost around $5,000 for a 19-panel setup.
Is my HOA allowed to restrict solar panels?
Homeowners associations (HOAs) are not legally allowed to prevent you from putting solar on your home in Massachusetts.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- Commonwealth of Massachusetts, "SMART 3.0 Program Details." Accessed March 12, 2026.
- Concord Municipal Light Plant, "Solar Panels and Batteries." Accessed March 12, 2026.
- Reading Municipal Light Department, "Residential & Small Commercial Solar Rebate (<20 kW)." Accessed March 12, 2026.
- Town of Ipswich, Massachusetts, "Solar PV." Accessed March 12, 2026.
- Hingham Municipal Lighting Plant, "Solar Rebate." Accessed March 12, 2026.
- Hudson Light and Power Department, "Rebates." Accessed March 12, 2026.
- Mass.gov, "Sales and Use Tax." Accessed March 12, 2026.
- Mass.gov, "Massachusetts net metering guide." Accessed March 12, 2026.
- Massachusetts Department of Revenue, "830 CMR 62.6.1: Residential Energy Credit." Accessed March 12, 2026.
- Reading Municipal Light Department, "Commercial Rebates." Accessed March 12, 2026.
- Town of Concord, Massachusetts, "Rebates for your Business." Accessed March 12, 2026.
- Holyoke Gas & Electric Department, "Residential Energy Assistance Program." Accessed March 12, 2026.
