If there ever was a time to consider investing in solar photovoltaic (PV) projects in Massachusetts, it is now. There are a number of federal and state financial incentives that may not be around for long.
- First, the developer can take advantage of a Federal U.S. Treasury “Cash Grant” based on 30% of the total value within 60 days of the project becoming operational. This benefit expires on the end of this year. Or, as an alternative, the owner can take a Federal Investment Tax Credit of 30% of the project value. Tax credit can be carried back 1 year and carried forward 20 years. This incentive expires December 31, 2016.
- Second, the owner can benefit from a 100% bonus depreciation. This is based on the total value in the year that the project is placed into service. This will also expire the end of this year, but will continue for another year with a 50% bonus depreciation.
- Lastly, project developers can benefit from the Massachusetts solar renewable energy certificates (SRECs.) The market for SRECs is currently trading at more than $500/MWH (there is a $300 floor.) This is value priced annually.
Maybe this is the right thing to do for the environment; but it looks like, for now, it is the smart thing to do for your bottom line.