Starting over a decade ago, the Massachusetts legislature began creating laws that require all suppliers of electricity (including utilities) to obtain a certain percentage of their electricity from renewables. The original legislation, called the Renewable Portfolio Standard or RPS, began in 2003 with all suppliers required to purchase 1% of generation from qualifying renewables. Since then the requirements have increased annually and have divided into different classes. Currently, there are two RPS Classes and an Alternative Portfolio Standard (APS); suppliers are required to obtain 11% of generation from RPS Class I renewables, 3.6% from RPS Class II renewables, 3.5% from RPS Class II waste energy generation, and 3.75% from APS. To comply with these obligations, suppliers buy Renewable Energy Certificates (RECs) from generators.

Furthermore, Massachusetts specifically wants to promote the growth of solar capacity in the State and created a RPS Solar Carve-Out program.  This program requires that a certain portion of RECs bought to fulfill the RPS Class I obligation be a subset of RECs titled Solar Renewable Energy Certificates (S-RECs).

The RPS cost changes year-to-year but currently is approximately $0.02/KWh. This cost could increase annually alongside the increasing RPS requirements.   For example, on April 8, 2016, the Massachusetts Department of Energy Resources (DOER) filed proposed regulations for a new solar incentive program.  In addition, the State’s Senate proposed S.2372 on June 24th 2016, which attempts to increase the RPS Class I requirements by 2% annually, instead of the current 1% increase each year. For more information see regulatory proceedings for RPS and APS.