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The 30% ITC is dead. Other companies are still advertising it. We are going to show you the real numbers — what you actually pay, what still saves you money, and why solar in Massachusetts still makes financial sense even without the federal credit.
2026 Reality: The 30% federal solar tax credit (Section 25D) expired December 31, 2025. All cost and payback figures on this page reflect $0 federal credit for homeowner cash/loan purchases. Full details
Before the sales pitch. Before the fine print. Here are the numbers.
The average Massachusetts homeowner pays $3.16/W for a fully installed solar system in 2026. For a typical 11kW system, that is $34,760 before state incentives. There is no federal tax credit — Section 25D expired December 31, 2025. But Massachusetts has the strongest state-level incentive stack in the country: SMART 3.0 pays $0.03/kWh for 20 years, net metering credits at full retail rate ($0.28-$0.34/kWh), a $1,000 state tax credit, 6.25% sales tax exemption, and a 20-year property tax exemption. The result: a 7.8-year payback and $147K+ in 25-year savings — even without a single dollar from Washington.
Avg Cost
$3.16/W
Fully installed
Federal Credit
$0
EXPIRED Dec 2025
Payback
7.8 yrs
Cash purchase
25-Year Savings
$147K+
Per system
In most states, losing the 30% federal credit would destroy the solar math. In Massachusetts, it doesn't — and here is why. Massachusetts has the highest residential electric rates in the continental United States. Eversource customers pay $0.2836/kWh. National Grid customers pay $0.32/kWh. Even Unitil, the smallest utility, charges $0.2833/kWh. The national average is roughly $0.17/kWh. Every kilowatt-hour your solar panels produce offsets electricity that costs 50-67% more than the national average. That alone compresses the payback period by years compared to states like Texas, Florida, or Arizona where rates are $0.12-$0.16/kWh.
Then stack the SMART 3.0 program on top: $0.03/kWh paid to you for every kWh your system produces, locked in for 20 years. That is an extra $396 per year for a typical 11kW system — $7,920 over the program term. Add in 1:1 net metering at full retail rate, the $1,000 state tax credit, 6.25% sales tax exemption ($2,173 saved on an average system), and a 20-year property tax exemption worth approximately $600 per year. No other state has this combination of high rates and stacked incentives.
The national average payback period without the ITC is 12-15 years. In Massachusetts, it is 7.5-8.5 years. That is a 25-year panel warranty generating 16+ years of pure profit after payback. The federal credit would have been nice. Massachusetts does not need it.
If a company is still advertising the 30% tax credit for homeowners, they are either behind the times or hoping you do not check.
"Get 30% off with the federal tax credit!"
Section 25D expired December 31, 2025. $0 for homeowners.
"Solar panels for as low as $24,332"
That was the post-ITC price. The real price is $34,760.
"The government pays for a third of your system"
Not since July 4, 2025, when OBBBA was signed into law.
"Act now before the credit drops to 26%!"
It did not drop to 26%. It dropped to 0%. The entire program was eliminated.
The federal credit is dead for homeowners
We price your system at $0 federal credit. No bait-and-switch.
MA state incentives are still strong
SMART, net metering, state credit, tax exemptions — they all still work.
Payback is 7.5-8.5 years without ITC
Longer than with the credit, but still well within the 25-year warranty.
Lease/PPA still accesses Section 48
Third-party system owner claims 30% ITC. Deadline: July 4, 2026.
The One Big Beautiful Bill Act (OBBBA) was signed into law on July 4, 2025. Among its provisions, it eliminated the Section 25D residential clean energy tax credit — the credit that gave homeowners 30% back on solar, battery, and other clean energy purchases. The credit had been in place since 2006 and was extended multiple times. As of December 31, 2025, it is worth $0. There is no phase-down. There is no expiration date suggesting a return. It is gone.
Section 25C, which provided credits for heat pumps, insulation, and other efficiency improvements, was also eliminated. Both credits expired on December 31, 2025.
The commercial Investment Tax Credit (Section 48/48E) survived — but it is only available to business entities, not individual homeowners. In the solar world, this means the third-party financing company that owns a leased or PPA system can still claim the 30% credit and pass the savings through to you as lower payments. But this window closes for projects that begin construction after July 4, 2026. If you are considering a lease or PPA, that deadline matters.
Here is what solar actually costs at every system size. The "Advertised" column shows what a company using the dead 30% credit would quote you. The "Real" column shows what you actually pay.
| System Size | Panels | Advertised (w/ dead ITC) | Real Cost (2026) | You Overpay By | Annual Savings |
|---|---|---|---|---|---|
| 5 kW | 12 | $11,060 | $15,800 | +$4,740 | $1,703/yr |
| 7 kW | 16 | $15,484 | $22,120 | +$6,636 | $2,384/yr |
| 9 kW | 21 | $19,908 | $28,440 | +$8,532 | $3,064/yr |
| 11 kW | 25 | $24,332 | $34,760 | +$10,428 | $3,745/yr |
| 13 kW | 30 | $28,756 | $41,080 | +$12,324 | $4,425/yr |
| 15 kW | 34 | $33,180 | $47,400 | +$14,220 | $5,106/yr |
The "Advertised" column shows the price a company would quote if they subtract the 30% ITC that no longer exists for homeowners. If any company quotes you these lower prices and claims a federal credit, ask: which section of the tax code? Section 25D is dead.
Even without the federal credit, Massachusetts state-level incentives reduce your upfront cost. Here is the math for a typical 11 kW system.
Your net upfront cost for an 11 kW system is approximately $31,587 after state-level incentives. This does not include the ongoing SMART income and net metering credits that drive the payback calculation.
Here is how your solar system pays for itself — year by year, dollar by dollar.
Net Metering Credits
$3,745/yr
13,200 kWh x $0.2836/kWh avg
SMART 3.0 Income
$396/yr
13,200 kWh x $0.03/kWh x 20 yrs
Property Tax Savings
$600/yr
100% exempt for 20 years
Avoided Rate Increases
+5%/yr
MA rates rising annually
An 11 kW system in Massachusetts produces approximately 13,200 kWh per year. With 1:1 net metering, every kWh you export to the grid earns a credit at full retail rate. At Eversource's $0.2836/kWh, that is up to $3,745 in annual bill credits. National Grid customers at $0.32/kWh earn approximately $3,586. Even Unitil customers at $0.2833/kWh earn $3,184. These credits roll over monthly, with an annual true-up. Net metering is the single biggest driver of solar ROI in Massachusetts.
The Solar Massachusetts Renewable Target program pays $0.03/kWh for every kWh your system produces — in addition to net metering credits. This rate is locked in at enrollment for 20 years. For an 11 kW system producing 13,200 kWh/year, that is $396 per year or $7,920 over the full term. Low-income households qualify for $0.06/kWh ($792/year). Adding a battery unlocks an additional $0.04/kWh storage adder ($528/year extra).
Solar installations are 100% exempt from property tax assessment in Massachusetts for 20 years. Your property taxes will not increase despite the solar system adding $25,000-$35,000 in home value. With Massachusetts average property tax rates around 1.2%, this saves approximately $500-$700 per year — money you never see on a bill but is real savings nonetheless.
All solar equipment and installation is exempt from Massachusetts' 6.25% sales tax — saving $2,173 on a $34,760 system. Add the $1,000 state income tax credit (15% of cost, capped at $1,000), and you save $3,173 at the time of purchase. These are applied automatically (sales tax) and via your state return (tax credit).
Here is how the math plays out year by year for an 11 kW cash-purchased system with Eversource as the utility. The system costs $31,587 net (after state incentives). Total annual benefit in Year 1 is approximately $4,141 (net metering + SMART). With 5% annual rate increases, the system pays for itself in approximately 7.8 years.
Year 1
$4,141
$27,446
Year 3
$13,100
$18,487
Year 5
$22,780
$8,807
Year 7
$33,315
-$1,728
Year 8
$38,950
-$7,363
Year 10
$50,800
-$19,213
Year 15
$84,500
-$52,913
Year 25
$178,000
-$146,413
Assumes 5% annual electric rate increase, 0.5% annual panel degradation, flat SMART rate. "Remaining" shows net position vs initial investment. Negative = profit.
The ITC is gone. Solar is still one of the best investments a Massachusetts homeowner can make. Here is why.
Massachusetts electric rates have increased an average of 4-6% annually over the past decade. Eversource went from $0.22/kWh in 2020 to $0.2836/kWh in 2026. At 5% annual growth, your current $0.2836/kWh rate becomes $0.46/kWh by 2036 and $0.75/kWh by 2046. Solar locks in your rate at $0.00/kWh for production, with SMART adding $0.03/kWh in income. Every year you wait, the gap between your utility rate and your solar production cost widens — in the wrong direction.
Unlike the federal credit, which required you to have tax liability, SMART pays you directly for every kWh your system produces. It does not matter what your tax situation is. $0.03/kWh is locked in for 20 years at enrollment. This is not a tax credit you might not be able to use — it is cash deposited into your account. Add the $0.04/kWh battery storage adder and you are at $0.07/kWh guaranteed for two decades. SMART capacity is finite — once the program fills up, it is gone.
Massachusetts requires all three investor-owned utilities to credit excess solar at the full retail rate for residential systems up to 25 kW AC. This is not a given — many states have reduced net metering to wholesale rates or eliminated it entirely. In MA, when you export a kWh to the grid, you get $0.28-$0.34 back on your bill. As rates rise, so does the value of your net metering credits. This is the single biggest reason Massachusetts solar payback periods are half the national average.
Research consistently shows that solar panels increase home value by approximately $15,000-$25,000 for a typical residential system. In Massachusetts, the 20-year property tax exemption means you get the value increase without paying higher property taxes. If you sell your home before the payback period ends, you recoup a significant portion (or all) of your investment through the higher sale price. Solar-equipped homes in Massachusetts sell faster and for more money than comparable non-solar homes.
A cash-purchased 11 kW system in Massachusetts at $31,587 net cost generates approximately $178,000 in cumulative value over 25 years — a net gain of $147,000+. That is a return of over 460% on your investment, tax-free.
Net Cost
$31.6K
25-Yr Value
$178K
Net Profit
$147K+
There is exactly one way for Massachusetts homeowners to still benefit from a federal tax credit in 2026. Here is how it works.
A third-party financing company (not you, not the installer) owns the solar system on your roof.
As a business entity, the third-party system owner claims the 30% commercial ITC under Section 48/48E.
They pass the savings through to you as lower PPA rates or lease payments — typically 10-20% below your current utility rate.
You pay $0 upfront, get immediate monthly savings, and the system generates electricity for 25+ years.
Deadline
Projects must begin construction before July 4, 2026
Credit Amount
30% of total system cost claimed by the third-party owner
Your Upfront Cost
$0 — the financing company covers everything
Your Monthly Savings
10-20% below current utility rate from Day 1
Ownership
Third-party owns the system. You can often buy it out after 7-10 years.
The commercial ITC under Section 48/48E is only available for projects that begin construction before July 4, 2026. After that date, even the PPA/lease path to a federal credit disappears. If you are considering a zero-down solar option, the window is approximately four months. Projects typically need 6-10 weeks from contract signing to construction start — so the real deadline for homeowner decisions is approximately April-May 2026.
Costs vary by city based on local permitting, installer competition, and utility territory. All figures are for an 11 kW system with $0 federal credit.
| City | Utility | Rate ($/kWh) | Cost/Watt | 11 kW Cost | Payback |
|---|---|---|---|---|---|
| Boston | Eversource | $0.2836 | $3.16/W | $34,760 | 7.6 yrs |
| Cambridge | Eversource | $0.2836 | $3.18/W | $34,980 | 7.7 yrs |
| Worcester | National Grid | $0.3200 | $3.08/W | $33,880 | 8.1 yrs |
| Springfield | Eversource | $0.2836 | $2.98/W | $32,780 | 7.3 yrs |
| Cape Cod | Eversource | $0.2836 | $3.22/W | $35,420 | 7.9 yrs |
| Newton | Eversource | $0.2836 | $3.20/W | $35,200 | 7.8 yrs |
| Lowell | National Grid | $0.3200 | $3.02/W | $33,220 | 8 yrs |
| New Bedford | Eversource | $0.2836 | $2.95/W | $32,450 | 7.2 yrs |
Payback assumes cash purchase, net metering at full retail, SMART at $0.03/kWh, $1,000 state credit, sales tax exemption, and 5% annual rate increase. No federal credit.
Add a battery and you unlock demand response revenue on top of SMART and net metering.
ConnectedSolutions is a demand response program where your battery automatically dispatches during peak grid events (typically 10-60 per summer). Revenue is on top of SMART and net metering income. A solar-plus-battery system with Eversource can generate over $7,000 per year in combined SMART income, net metering credits, and ConnectedSolutions payments. Note: Unitil does not participate in ConnectedSolutions.
Use our calculator to see your specific numbers — based on your utility, system size, and financing choice. All calculations reflect $0 federal ITC.
Estimate your solar return on investment with SMART income, net metering credits, ConnectedSolutions, and MA tax benefits.
Federal Residential Solar Tax Credit (Section 25D) Expired
Homeowners who purchase solar with cash or a loan receive $0 in federal tax credits. Section 25D expired December 31, 2025.
Eastern MA (Boston, South Shore, Cape Cod, MetroWest, Western MA)
Electric Rate
$0.28/kWh
Net Metering
1:1 retail credit (Class I ≤25 kW)
SMART 3.0 Rate
$0.03/kWh
Interconnection
2-4 weeks typical
20-year exemption — solar adds $0 to your property tax
Payback Period
7
years
25-Year Savings
$114,687
total
Monthly Benefit
$378
per month
Estimates based on average 2026 MA solar pricing, SMART 3.0 $0.03/kWh residential flat rate, 1:1 retail net metering, 6.25% sales tax exemption, 20-year property tax exemption, and 15% state tax credit (max $1,000). Section 25D residential ITC expired Dec 31, 2025 — $0 federal tax credit for cash/loan purchases.
Straight answers to the most common questions about solar costs in Massachusetts in 2026.
Solar panels in Massachusetts cost an average of $3.16 per watt installed in 2026. For a typical 11kW residential system, the total cost is approximately $34,760 before state incentives. After the $1,000 Massachusetts state tax credit and 6.25% sales tax exemption ($2,173), the net cost is approximately $31,587. There is no federal tax credit for homeowner cash or loan purchases — Section 25D expired December 31, 2025.
No. The 30% residential solar Investment Tax Credit (Section 25D) expired on December 31, 2025, under the One Big Beautiful Bill Act (OBBBA) signed July 4, 2025. Homeowners who purchase solar with cash or a loan receive $0 in federal tax credit. Any company still advertising a 30% credit for homeowners in 2026 is providing inaccurate information. The only way to indirectly benefit from a federal credit is through a solar lease or PPA, where the third-party system owner claims the 30% commercial ITC under Section 48/48E.
The payback period for a cash-purchased solar system in Massachusetts is approximately 7.5 to 8.5 years without the federal ITC. This factors in SMART 3.0 income ($0.03/kWh for 20 years), net metering at full retail rate ($0.28-$0.34/kWh depending on utility), the $1,000 state tax credit, 6.25% sales tax exemption, and 20-year property tax exemption. Over 25 years, a typical system saves approximately $147,000.
Some solar companies have not updated their marketing materials since the OBBBA was signed on July 4, 2025. Others are conflating the commercial ITC (Section 48/48E, which is still available for third-party system owners) with the residential ITC (Section 25D, which is dead). If a company tells you that you personally will receive a 30% credit on a cash or loan purchase, they are either uninformed or being deliberately misleading. Ask them directly: which section of the tax code provides the credit?
You do not personally receive the credit, but the benefit is passed through to you. In a solar lease or PPA, a third-party financing company owns the system on your roof. As a business entity, that third-party system owner can claim the 30% commercial Investment Tax Credit under Section 48/48E for projects beginning construction before July 4, 2026. They pass the savings to you in the form of lower lease payments or PPA rates. This is the one remaining way to benefit from a federal credit in 2026.
Massachusetts still has a strong incentive stack: (1) SMART 3.0 program paying $0.03/kWh for 20 years ($0.06 for low-income), (2) 1:1 net metering at full retail rate for all three IOUs, (3) $1,000 state income tax credit (15% of cost, capped at $1,000), (4) 20-year property tax exemption, (5) 6.25% sales tax exemption, (6) ConnectedSolutions battery demand response revenue ($225-$1,500/yr), and (7) Section 48/48E still available via lease or PPA through July 4, 2026.
No. The OBBBA eliminated Section 25D with no scheduled return date and no pending legislation to restore it. Meanwhile, you are paying $0.28-$0.34/kWh to your utility every month, and MA rates have risen 4-6% annually. Every month you wait costs you approximately $200-$350 in electricity bills that solar would offset. Additionally, the Section 48 commercial ITC (which powers the lease/PPA benefit) expires for new projects after July 4, 2026 — that window is closing fast.
Cash purchase produces the highest 25-year savings ($147,000+) because you keep 100% of SMART income and net metering credits. However, a PPA or lease costs $0 down and still gives you immediate savings of 10-20% below your retail rate, and the third-party owner can claim the 30% Section 48 ITC through July 4, 2026. Solar loans at 5.5-8% APR are available through local lenders for those who want ownership without the full upfront cost. The best choice depends on your cash position and whether you want maximum long-term savings or zero upfront cost.
Dive deeper into specific topics with our other MA solar guides.
Full overview of costs, incentives, utilities, and next steps.
Read guideDetailed cost breakdown by system size, panel tier, and city.
Read guideDeep dive into why solar still works in MA without 25D.
Read guideSide-by-side financing comparison with real numbers.
Read guideHow SMART works, current rates, adders, and enrollment.
Read guideWe quote your system at the real 2026 price — $0 federal credit, real state incentives, honest payback timeline. No bait-and-switch. No fine-print surprises at signing.