The Cape Light Compact’s Equity-Centered Model for Solar+Storage+Electrification 

Since 2019, Massachusetts utilities have offered battery performance payments to wealthier customers, but without any equity provisions to help low-income residents access the program. Now, an innovative new model combining solar PV and energy storage with electrification and traditional efficiency measures is providing new opportunities for some low- and moderate-income households to fully decarbonize their homes, install batteries for back-up power, and contribute to the Commonwealth’s broader clean energy goals.  

Cape Light Compact (the “Compact”), a municipal energy services aggregator serving communities on Cape Cod and Martha’s Vineyard, obtained regulatory approval to launch the Cape & Vineyard Electrification Offering (CVEO) pilot in 2023. This unique program serves as a model for integrated, sustainable and inclusive distributed energy programs that can help ensure underserved communities have an equitable share in the transition to a clean energy future.  

Clean Energy Group recently published a report, “Solar+Storage+Electrification: A Clean Energy Equity Model for Massachusetts,” which outlines the history and structure of the CVEO. 

The program is unique in two ways. First, it makes residential battery systems available to low- and moderate-income households; and second, it combines solar+storage with electrification and energy efficiency, providing a one-stop-shop for home decarbonization, energy efficiency and backup power.  

The CVEO faced a rigorous and lengthy approval process, with three separate proposals submitted to the Massachusetts Department of Public Utilities (DPU) over five years. A major breakthrough came with the passage of the 2022 Act Driving Clean Energy, which granted energy efficiency program administrators, such as Cape Light Compact, the authority to propose electrification programs specifically for low- and moderate-income households. This legislative milestone paved the way for the approval of the CVEO. 

Key features of CVEO include: 

• Targeted participation for low- and moderate-income households: The program aims to support 100 households: 80 low-income households (earning below 60% of area median income) and 20 moderate-income households (60-80% of area median income). 
• Whole-home electrification: Participants must commit to replacing all of the fossil fuel based heating, cooling, and cooking appliances as well as installing both solar and heat pumps. 
• Solar and battery integration: Solar panels will help offset heat pump electricity usage. Battery storage is optional, but the Compact aims to install 25 batteries, mainly in low-income households,- to ensure heat pumps are able to operate during electric grid outages. 
• Financial support: Low-income participants receive free batteries; moderate-income participants may access financing options such as 0% Home Energy Assistance (HEAT) Loans. 
• Demand response program enrollment: Households receiving batteries will be enrolled in ConnectedSolutions for 10 years. ConnectedSolutions is a statewide demand response initiative that helps manage electricity demand during peak periods. Participants in this program earn performance payments by allowing the Compact to use their stored energy during peak demand times, which contributes to overall grid stability and helps lower costs for all ratepayers. Participants who receive the 100 percent incentive for the installation of battery storage through the CVEO program are not eligible to receive performance payments through ConnectedSolutions- instead, performance payments earned by these participants would go to Cape Light Compact to help defray program costs.  

The CVEO program is also able to aggregate and sell any renewable energy credits (RECs) associated with the solar installations through Massachusetts’s Renewable Portfolio Standard (RPS). Similarly, heat pumps are enrolled in the Alternative Portfolio Standard program, which requires electricity suppliers to source a certain percentage of their power from alternative energy sources and provides incentives for energy efficiency and innovation through Alternative Energy Certificates that can be traded to meet compliance requirements. Revenues from the APS will be paid to Cape Light Compact and used to offset energy efficiency program costs.  

CEG’s new report on the CVEO is published as part of a broader series of work that addresses energy storage policy and programs in Massachusetts and New England. Related reports can be found here. Learn more about CEG’s broader work on energy storage policy on our project page. 

Read the full report here, and register for the upcoming webinar that will feature speakers from Cape Light Compact on Tuesday, April 8^th from 1-2pm ET here.