Last Thursday, the Massachusetts Legislature increased the cap on solar net metering, which creates additional capacity to advance new projects.

What is Net Metering?

Net metering allows all classes of residential and commercial customers to generate their own electricity and to feed their unused electricity back into the grid to offset their usage (generally, customers are paid retail prices for this electricity).  Solar installations are connected to a special “retail meter” which spins forward when the customer uses electricity and backward when the customer generates excess electricity, thus measuring the “net” quantity of electricity that the customer uses. Net metering has been an ongoing battle between solar companies and utilities as it threatens demand for utilities’ sales of electricity and is a critical piece of the economic support for new on-site solar projects.

Summary of the Bill

The bill raises the net metering cap from 3% to 5% of the utilities’ highest historical peak load for public projects and from 3% to 4% for private projects.  It also creates a task force to evaluate the long-term feasibility of net metering in the state and Governor Patrick’s future goals for solar energy generation.

Opportunities Created to Advance New Projects

Not only does the lift of the net metering cap prevent current public and private solar projects in the pipeline from stalling; it also creates additional capacity under the cap for any company to advance new projects.  Massachusetts ranks sixth amongst U.S. states for installed solar energy capacity, with 464 megawatts (MW) currently installed.  In 2013 alone, an additional 237 MW of solar energy was installed, accounting for $789 million in investment for residential, commercial, and utility-scale solar projects – a 50% increase over the previous year.  The total MW installed is expected to grow with the additional capacity this bill adds under the cap.