Massachusetts has dedicated $3.5 million to nine renewable thermal projects in the state through a new grant program, the Massachusetts Renewable Thermal Business Investment Financing Program.

Funds for the program are being drawn from the state’s Alternative Compliance Payment funds, which are payments made by electricity suppliers when they do not meet state renewable energy portfolio standard obligations. Payment amounts vary according to technology class and compliance year. For example, in 2014, suppliers in RPS Class I—which includes sources installed after 1997—must pay $66.16 per MWh not achieved.

Each year, ACP funds are allocated by the Massachusetts Clean Energy Center. Through the new program, a variety of technologies are eligible for funding, including woody biomass, grass pellets, advanced biofuels, biogas, solar thermal, and inverter driven air and ground source heat pumps.

Some of the funded projects include a $1 million to Rocky Mountain Wood in Wilbraham, Mass., for development of a community-scale wood pellet manufacturing facility, over $800,000 to Maine Energy Systems for a new bulk pellet distribution facility and pellet boiler showroom in Salisbury, Mass., and a $75,000 grant to the Biomass Thermal Energy Council for development of an efficiency test procedures for commercial-sized, solid biomass boilers.