Massachusetts Energy Storage Incentives: ConnectedSolutions and Related Programs

Massachusetts offers a structured set of financial incentives for battery storage systems, anchored by the ConnectedSolutions demand-response program administered through the state's electric distribution companies. This page covers the definition, mechanics, eligible configurations, and decision boundaries for storage incentives in Massachusetts, including how ConnectedSolutions interacts with solar-paired storage, standalone storage, and related state programs. Understanding these programs is essential for property owners and project developers evaluating whether storage investment meets site-specific financial thresholds.

Definition and scope

Energy storage incentives in Massachusetts are financial mechanisms that compensate battery system owners for making stored electricity available to the grid during periods of peak demand or grid stress. The primary program is ConnectedSolutions, a demand-response initiative coordinated by the Massachusetts electric distribution companies — Eversource, National Grid, and Unitil — in collaboration with the Massachusetts Clean Energy Center (MassCEC) and the Massachusetts Department of Public Utilities (DPU).

ConnectedSolutions applies to both residential and commercial battery storage systems and does not require solar co-location — a standalone battery qualifies under the same framework as a solar-plus-storage system. Incentive payments are structured as capacity payments per kilowatt (kW) of enrolled demand-response capacity, not as upfront rebates.

Scope boundary: This page covers programs administered within Massachusetts and available to ratepayers of the state's investor-owned electric utilities. Municipal light plant (MLP) customers — served by entities such as the Reading Municipal Light Department or Shrewsbury Electric — fall outside ConnectedSolutions as administered by the three investor-owned utilities, though individual MLPs may operate analogous programs. Federal programs, including the federal Investment Tax Credit (ITC) for storage installed after the Inflation Reduction Act of 2022, are addressed separately at Federal Investment Tax Credit Massachusetts and are not covered in depth here. Programs in neighboring states are not covered.

How it works

ConnectedSolutions operates through a curtailment service provider (CSP) or directly through the utility. Enrolled battery systems discharge stored energy during utility-dispatched events, typically coinciding with ISO New England's coincident peak periods. Compensation is calculated on a per-kW basis tied to the system's demonstrated demand-response capability.

Residential ConnectedSolutions — typical program mechanics:

Enrollment: The property owner enrolls a qualifying battery system (minimum capacity thresholds vary by utility; Eversource has historically required at least 3 kW of usable discharge capacity) through the utility or a participating aggregator.
Baseline establishment: The utility establishes a performance baseline by measuring the battery's discharge capability over a defined test period.
Dispatch events: During summer peak season (typically June–September, aligned with ISO New England's coincident peak methodology), the utility sends automated dispatch signals. The battery discharges for durations commonly ranging from 30 minutes to 4 hours.
Performance measurement: Each event measures actual demand reduction in kW against the baseline.
Payment calculation: Annual incentive payments are calculated by multiplying enrolled capacity (kW) against the program's stated per-kW rate. Eversource's residential ConnectedSolutions rate has been set at approximately $225 per kW-summer (Eversource ConnectedSolutions program documentation), though rates are subject to DPU approval and program-cycle adjustments.
Reconciliation: Payments are issued after the summer demand-response season concludes, typically in the fall.

Commercial ConnectedSolutions follows a parallel structure but may carry higher per-kW rates — National Grid's commercial program has published rates in the range of $400–$500 per kW — reflecting larger system capacities and greater grid impact. Commercial participants should consult the regulatory context for Massachusetts solar energy systems for how DPU tariff filings govern commercial storage participation.

The Massachusetts Battery Storage program administered by MassCEC has also provided upfront capital incentives at varying times, with past residential rebates reaching $625 per kWh of installed capacity for income-qualified households. Program funding and availability change based on legislative appropriation.

Common scenarios

Scenario 1 — Residential solar-plus-storage: A homeowner installs a 10 kWh AC-coupled battery alongside an existing photovoltaic system. The battery charges primarily from solar during the day and enrolls in ConnectedSolutions for summer dispatch events. The system earns demand-response payments while also supporting the home during grid outages. For a broader understanding of how solar generation interacts with storage in Massachusetts, see how Massachusetts solar energy systems work.

Scenario 2 — Standalone storage, no solar: A property owner installs a 13.5 kWh battery with no photovoltaic panels. The battery charges from the grid during off-peak hours and discharges during ConnectedSolutions events. ConnectedSolutions eligibility does not require solar co-location, making this configuration fully qualifying under current program rules.

Scenario 3 — Commercial building with demand charges: A small commercial facility installs a 30 kW / 60 kWh battery to reduce utility demand charges during on-peak hours. The system simultaneously enrolls in the commercial ConnectedSolutions tier. The two revenue streams — bill savings from demand charge reduction and ConnectedSolutions payments — can be modeled independently. More information on commercial-specific considerations is available at commercial solar energy systems Massachusetts.

ConnectedSolutions vs. SMART Program — key distinction: The SMART (Solar Massachusetts Renewable Target) program compensates solar generation on a per-kWh basis through an adder applied to metered output. ConnectedSolutions compensates battery discharge capacity in kW during peak demand events. These are structurally different incentives — one is a production payment, the other a capacity payment — and a solar-plus-storage system can participate in both simultaneously, subject to metering and interconnection compliance.

Decision boundaries

Not all storage installations qualify for ConnectedSolutions or MassCEC incentives. The following boundaries govern eligibility and program fit:

Capacity floor: Systems below the utility's minimum enrolled capacity threshold do not generate sufficient demand response to qualify. Verify current minimums with the enrolling utility before sizing.
Technology type: ConnectedSolutions targets battery storage systems capable of automated dispatch. Non-dispatchable thermal storage or generator-based backup systems fall outside the program's scope.
Grid interconnection status: A battery system must be interconnected through a completed utility interconnection process to participate. Pre-interconnection systems cannot enroll.
MLP vs. IOU territory: As noted in the scope section, municipal light plant customers are not served by ConnectedSolutions as run by Eversource, National Grid, or Unitil. MLP customers should contact their municipal utility directly.
Income qualification: MassCEC's upfront storage rebate program, where active, applies higher per-kWh incentive rates for income-qualified households — a meaningful distinction for program stacking analysis. The low-income solar programs Massachusetts page covers the eligibility framework for income-targeted incentives.
Stacking with the ITC: Storage systems placed in service after the Inflation Reduction Act of 2022 may qualify for the federal ITC at 30% of installed cost when charged predominately from on-site renewable generation. Stacking the federal ITC with ConnectedSolutions payments is permissible under current federal guidance, though the ITC applies to capital cost at installation while ConnectedSolutions generates annual operational revenue. These are independent incentive mechanisms.
Safety and permitting compliance: Massachusetts battery storage systems must comply with NFPA 855 (Standard for the Installation of Stationary Energy Storage Systems) and applicable Massachusetts State Building Code (780 CMR) requirements. Local Authority Having Jurisdiction (AHJ) permitting and inspection are required before interconnection approval. Systems not passing AHJ inspection cannot complete interconnection and thus cannot enroll in ConnectedSolutions. Solar energy and Massachusetts building codes addresses the code framework in more detail.

The full incentive landscape for Massachusetts solar energy — including property tax exemptions, sales tax exemptions, and SREC/SMART interactions — is catalogued at Massachusetts Solar Incentives and Rebates and at the Massachusetts Solar Authority home.

References

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