Q: Subsidies for battery storage with a solar system?

A: There are now three separate subsides for batteries in MA: if you have an array enrolled in SMART you get an “adder” for having a battery. The SMART subsidy in October 2020 is about 8c/kWh (note this deceases with time and varies with the utility company you use so please check what it is today). The adder for the battery is about 4c/kWh. For a typical 10kW array producing 10,000kWh a year the SMART subsidy is worth $800 a year and the battery adder is worth another $400 on top. Both are for 10 years so the adder is worth about $4,000. Both decrease with time – that is the structure of the SMART subsidy scheme. However, once you get your subsidy rate it is locked in for 10 years.
A Powerwall battery costs $10,000 to $15,000 fully installed. So the $4,000 SMART adder cuts the price by a third to a half. The SMART adder is (as is all SMART income) taxable income.  I have yet to see a solar installer admit this.

In addition, Eversource has a subsidy called Connected Solutions where ES pays you to have access to your battery during peak power demand. This payment seems to be about $1,200 a year but the it is not really clear exactly how this is calculated or for how many years it lasts. It is not clear if this is considered taxable income (like SMART) of if it is considered more like a rebate or a credit (the way net metering works, and that is not taxable income). If the Connected Solutions program lasts 10 years it would pay for the entire cost of the battery which seems excessively generous and therefore unlikely. However, it will be something else to reduce the cost to you. 

Finally there is a brand new subsidy, called CPEC (which was just announced in August 2020) or Clean Peak Energy Certificates. Power stations are now required to buy these CPECs to reduce their carbon emissions during peak demand on the grid. They are a bit like SRECs which is what SMART replaced. Peak demand (say on a hot summer afternoon when everyone has their AC on) brings the fossil fuel “peaker” plants into operation. These are not only the most expensive power-generating plants on the grid but they are often also the dirtiest, i.e., cause the most pollution and CO2 emissions. Hence, the state has a strong interest in reducing the use of these peaker plants through encouraging batteries. CPECs are brand new and no-one can even tell me how much I can earn from them or whether they are taxable income. However, it is sure to be favorable to you. So, overall, and despite all the uncertainty, batteries are looking like a better and better bet. I have ordered battery systems for both our home and our rental property.

My final point is not about batteries but about generators. A diesel or propane generator costs about $500 a year to set serviced so it will work when you actually need it. This is $5,000 over 10 years. The generator itself will probably cost you $3,000 up front. So, the 10-year cost of a generator is $8,000. The 10-year cost of a battery is between $5,000 and $10,000 with the current SMART subsidy alone. Add in Connected Solutions and CPEC and batteries are looking like a really good investment. Oh, and did I mention that they have a zero carbon footprint and emit no asthma-inducing soot, nitric oxide or sulfur dioxide?

Note this post was current as of October 2020. The subsidies for batteries are a moving target and one that changes by state, by utility, over time and even by zone you are in within a utility’s service area. Please check the latest information for your home before deciding to install a battery.