What incentives and rebates are available to me?
As a renewable energy technology, solar water heaters are eligible for various incentives and financing options in the state of Massachusetts.
The state of Massachusetts provides numerous incentives and rebates for solar water heaters. All cost calculations made on the WePowr website incorporate the most up-to-date information on available financial incentives.
Massachusetts Clean Energy Center: Commonwealth Solar Hot Water Residential Program
The Massachusetts Clean Energy Center (MassCEC) provides rebates for SWHs through the Commonwealth Solar Hot Water Residential Program. The size of the rebate is capped at $4,500 or 40% of system cost (whichever is less) and will depend on a number of factors, including: number of collectors installed, the system’s rated performance, whether you install a meter, whether the system includes parts manufactured in Massachusetts, and whether you have previously installed solar PV panels on your home.
In addition, all systems that receive the MassCEC rebate will be required to provide a 10-year manufacturer’s warranty for the collector, a 2-year warranty for other system components, and at least a 2-year comprehensive installation warranty. WePowr only works with installers who can guarantee these warranties at a minimum.
The average rebate received by Massachusetts homeowners between 2011 and 2014 was approx. $1,800. More information about eligibility and how the rebate is awarded is available here. Additional information about MassCEC’s residential solar hot water program is available here.
Massachusetts Sales and Property Tax Exemptions
Equipment directly related to solar water heater systems are exempt from Massachusetts’ state sales tax.
Any value added to your property through the installation of a solar water heater system is exempt from local property taxes for 20 years. Note that this does not cover your entire property tax bill—just the value added by your system.
Federal Residential Renewable Energy Tax Credit
The federal government allows you to claim a credit of 30% of all of your solar hot water system’s installed costs. If the tax credit exceeds your tax liability, you will be able to carry it forward to the next year. Note however that this tax credit is expiring at the end of 2016, and it is currently unclear whether unused tax credits will be able to be carried forward after 2016.
Massachusetts Residential Renewable Energy Tax Credit
The state of Massachusetts allows you to claim a credit of 15% (maximum of $1,000) of the net expenditure for the installed costs of your solar hot water system—that is, the total amount you spent on your system minus any federal tax credits or rebates (see above). If your tax credit exceeds your liability, you may carry it forward up to three years. Unlike the federal tax credit, this tax credit has been in place since 1979 and is unlikely to expire for the foreseeable future.
Mass Save HEAT Loan Program
Mass Save provides 0% interest loans of up to $25,000 with terms of up to 7 years for various renewable energy and energy efficiency improvements, including solar water heaters. You may be eligible for a HEAT Loan if you are an electric customer of National Grid, Eversource, Cape Light Compact, or Unitil, or if you are a gas customer of Liberty Utilities or Columbia Gas.
Learn more about how to apply for heat loan program financing here.