The primary determinant of solar energy resource potential, the amount of solar energy shining down on cities across the U.S., known as solar insolation, varies widely across the U.S. Among major North American cities, Boston, for example, received an average 3.58 kilowatt-hours per square meter per day (kWH/m2/day) of solar energy over the most recently published 10-year period. Honolulu, Hawaii topped the list, receiving an average 5.96 and Los Angeles ranked second at 5.4 kWh/m2/day. Anchorage, Alaska received the least, an average 2.09, while Montpelier, Vermont received an average 3.43 kWh/m2/day of solar energy, the second lowest.
Solar insolation, however, is not the sole factor that determines the value homeowners can realize by investing in a solar photovoltaic (PV) system. Government policy, market regulations and utility rate structures can be equally, if not even more important, when it comes to determining the value of residential solar in a given town or city.
Boston ranked second among major U.S. cities in terms of residential solar energy savings potential, according to a 2015 study undertaken by the North Carolina Clean Energy Technology Center. Furthermore, Bostonians, as well as others installing residential solar PV systems in Massachusetts, benefit from a host of government and utility solar incentives. In fact, Boston rates third among major U.S. cities when it comes to potential solar energy savings based on data and calculations from SolarReviews' sister site, Solar-Estimate.org.
Boston residents also don't want for choice when it comes to finding a highly rated solar energy installation company, or the means to finance their home solar projects. We delve further into the value of a residential solar energy system in Boston, Massachusetts, here in part two of this two-part series.
An Economic Look at Powering and Heating Homes in Boston
Boston households paid an average 21.4 cents per kWh for electricity in December 2017. That was 57.4 percent more than the nationwide average of 13.6 cents per kWh, according to the U.S. Bureau of Labor Statistics (BLS). Furthermore, electricity costs in Boston were 46.6 percent higher compared to the nationwide average. That has been the case for each of the last five years, when the price of electricity in Boston in December exceeded the nationwide average by 27.5 percent or more.
In addition, Bostonians rely primarily on natural gas to heat their homes during winters, as do most others throughout Massachusetts and New England. Boston area residents paid an average $1.455 per therm of utility natural gas last December, 39.6 percent higher than the national, December 2017 average of $1.042 per therm. Local, December 2017 retail natural gas prices were up substantially – 35.3 percent higher – as compared to December 2016, when Bostonians paid an average $0.972 per therm. Looking out over each of the past five years, natural gas prices in Boston exceeded the nationwide, December average by 30.7 percent or more.
In sharp contrast, the all-in cost of a residential solar PV system has been declining rapidly in Boston, as it has been throughout Massachusetts and the U.S. According to the U.S. Solar Energy Industries Association (SEIA), the cost of solar energy in Massachusetts has dropped 55 percent in the last five years.
In addition, Massachusetts' elected officials continue to forge an institutional framework of policies and programs that makes Massachusetts a leading light in terms of U.S. solar and renewable energy adoption. Boston residents can take advantage of no less than 30 residential solar PV incentives at the federal, state and local levels.
A Wealth of Solar Incentives in Boston Massachusetts
Massachusetts' Renewable Portfolio Standard (RPS) at present requires the state's investor-owned power utilities to source 22.1 percent of the electrical energy they distribute from solar or other renewable energy resources. Part and parcel of the RPS is a solar “carve-out,” which requires Massachusetts' investor-owned utilities to obtain an increasing percentage of the renewable energy they acquire and distribute specifically in the form of solar energy. That includes connections to “behind the meter,” residential solar PV systems.
A component of the state government's solar carve-out, Massachusetts, along with other state governments across the Northeast, recognize and put a monetary value on the environmental benefits associated with the installation of solar energy systems by issuing a specified number of solar renewable energy credits (SRECs) each year. Solar homeowners in Boston and throughout Massachusetts can qualify for and earn SRECs based on the amount of electrical energy their solar PV systems produce. They can be held or sold on a secondary market.
Net metering also figures prominently in adding to the value of residential solar energy in Boston and Massachusetts. The state's net metering program enables customers to offset their energy use and dispatch energy produced by their PV systems to the local utility grid. Utilities, in turn, credit solar customers' bills.
The federal solar investment tax credit provides the greatest added value to a Bostonian's residential solar PV system. Solar homeowners that qualify for the tax credit can deduct 30 percent of the all-in, installed cost in the tax year the project commences. However, the federal solar ITC is being phased out. Homeowners that begin installation through 2019 can qualify for a 30 percent tax credit, but the ITC steps down to 26 percent in 2020 and 22 percent in 2021. The residential credit drops to zero in 2022.
All things considered, the average cost of installing a residential solar PV system in Massachusetts comes in at $3.68 per watt at present. Using Solar-Estimates pricing app we found that installation of a 4.7 kilowatt (kW) rooftop solar PV system in Boston's 02108 zip code would yield 5,263 kilowatt-hours of emissions-free electricity per year.
Find the Top Solar Companies in Massachusetts
Over the useful life of such a system, a Boston solar homeowner can expect to save a net of around $72,557. You can obtain your own live price quote from a local installer in minutes simply be keying in some basic location information and a few details regarding your home and energy usage. Those looking to install a residential solar energy system in Boston can also benefit by checking out SolarReviews' latest ranking of the top 10 solar energy systems installers in Massachusetts.