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State solar incentives

Solar incentives in Maryland: All-in-one list

Edited by: Andrei Gorichenskii

Decided to go solar in Maryland? Good idea! Explore solar incentives in Maryland to make your purchase even more profitable. Take a look at the list that we have just prepared.

Key takeaways

  • Solar incentives and grants in Maryland can make your solar switch even more profitable, reducing your taxes, initial system costs, and electric bills. Plus there are several programs for different counties.
  • Maryland residents can claim a 30% federal tax credit on the total cost of their solar panel system installation. The incentive is applicable to both homeowners and commercial companies.
  • All utilities in Maryland offer net metering for solar energy systems. Credits are valued at the full retail electricity price. Unused credits after a 12-month period (ending in April) are bought at commodity energy supply rates.
  • SRECs are earned for generating clean energy, regardless of selling electricity. SRECs can be stored and sold through GATS. Potential annual income of $300-$1,000 for a 10kW solar system. Requires certification from the Maryland Public Service Commission.
  • Residential Clean Energy Rebate Program provides a flat $1,000 rebate for residential solar PV system installations. Installers must be NABCEP certified. System must use new equipment and meet applicable standards.
  • 100% of the added value from a solar PV system is exempt from property taxes. Property value increases by approximately 4%.
  • Many components of solar generating equipment are exempt from sales tax. This includes solar modules, inverters, and batteries.
  • Solar easements protect solar systems from shading. Voluntary agreements between property owners. Must be a written and legal contract.

Save 30% of your PV system cost with Federal Solar Tax Credit

The US government wants more people to go solar: it’s a modern and green way of getting energy. This is why the Solar Investment Tax Credit (ITC) program was developed. It allows American citizens to claim 30% of the cost of their installation as an income tax deduction. The cost here is not only solar panels, but also shipping, installation expenses and more. For example, if your system overall made you spend $10,000, the government returns you $3,000. To claim the ITC, complete all the necessary forms and submit them when filing your taxes.

Read also

U.S. Climate Bill: 30% Solar Tax Credit comes back

Sell excess electricity with net metering program

Solar laws in Maryland allow customers of all utilities to join Net Metering programs. Hence, residential solar owners have the option to send the excess electricity back to the grid instead of storing it with battery banks. When you sell your solar power to the utility, you receive credits that can be used to offset your next bills. In Maryland their value is equal to full retail electricity price. If you have unused credits after a 12-month period ending in April, they will be bought from you at commodity energy supply rates.

Read also

Take my energy: What is net metering and how it works

Save up to $1,000 a year trading SRECs

Solar Renewable Energy Credits are certificates granted to any person or entity upon generation of each MWh of clean electricity. Unlike with Net Metering, you don’t need to sell any electricity to get credits. The value of SRECs is always changing, which makes them similar to stock market assets. Based on the available data, selling SRECs could mean anywhere from $300 to $1,000 annually for a 10kW solar system. To participate, you have to apply for certification from the Maryland Public Service Commission. After that, you can create a SREC account with the Generation Attribute Tracking System (GATS) to begin storing and selling your credits.

Save additional $1,000 with Residential Clean Energy Rebate Program

The rebate program managed by Maryland Energy Administration provides a flat $1,000 incentive to residential property owners who install solar PV systems. The installer must be certified by NABCEP and can only work with new solar equipment. The system has to meet all applicable standards. You can only claim the incentive for your primary residence.

After the installation is completed, you will have 12 months to submit the application. Together with the form you will have to submit the invoice, copies of inspection results, a picture of the installed system and historical screening documents.

Freeze your tax with Property Tax Exemption for PV Systems

4%

this is how much solar panels increase the value of your house

A solar PV system installed in a home increases its value by about 4%, says the Zillow report. In Maryland, this increase doesn’t come with associated higher taxes. According to state laws, 100% of the value added as a result of a solar PV system installation may not be included among taxable property. The law applies to all structures and includes both state and local taxes.

Maryland sales tax exemption makes solar equipment cheaper

Many components are exempt from your sales tax under Maryland sales tax exemption for solar generating equipment. According to the law, you don’t have to pay sales tax on products directly involved in the production of electricity, including your solar modules, inverters, or Maryland energy storage systems.

Protect your solar panels from shade with Solar Easements

A solar easement contract is a written agreement between you and another party, for example, your neighbor. This type of contract helps to ensure a stable supply of sunlight for your PV system for years to come. A solar easement protects your panels from potential impairments, such as vegetation and structures. It is voluntary and must contain the description of protected space, a list of restrictions and a clause on revision or termination of the contract. Once signed, it is tied to the land, not the owner. Any such agreement must be created in written form and must meet the general requirements for legal contracts.

Incentive/
Program
DescriptionBenefitsEligibility/
Requirements
Notes
Federal ITC (30%)
30% tax credit on the total cost of solar system installation.
Reduces overall system cost, accelerates payback period.
Must own the system, meet IRS guidelines.
Applies to installation, equipment, and other associated costs.
Net Metering
Allows homeowners to sell excess solar energy back to the grid for credits.
Reduces or eliminates electricity bills.
Customers of all Maryland utilities.
Credits at full retail rate, unused credits bought at commodity rates.
SRECs
Solar Renewable Energy Credits earned for generating clean energy.
Provides additional income through the sale of certificates.
Certification from Maryland Public Service Commission; GATS account.
SRECs traded on GATS.
Residential Clean Energy Rebate Program
Flat $1,000 rebate for residential solar installations.
Reduces upfront costs.
NABCEP certified installer, new equipment, primary residence.
Application within 12 months of installation.
Property Tax Exemption
Exemption on added property value from solar.
No increase in property taxes due to solar.
Installation of a solar PV system.
100% exemption. Property value increases by ~4%.
Sales Tax Exemption
Exemption on certain solar equipment.
Reduces upfront costs.
Purchase of solar generating equipment.
Includes solar modules, inverters, and batteries.
Solar Easements
Legal agreements to protect access to sunlight.
Ensures optimal solar panel performance.
Negotiated between property owners.
Must be a written and legal contract.


What are solar incentives, and why do they exist?
Imagine your town or city is really excited about the idea of everyone using sunshine to make electricity. They know that sunlight is a fantastic source of energy, and it's much better for the environment than burning fossil fuels. However, they also understand that installing solar panels on your house or business can be a big investment. That's where "solar incentives" come in. Think of them as special programs designed to make going solar much more affordable and attractive.

One of the most common incentives is the "tax credit." When you decide to buy and install solar panels, you can tell the government about it when you file your taxes. They'll allow you to subtract a certain amount of the money you spent on the panels from the total amount of taxes you owe. It's like getting a discount on your tax bill.

Another popular incentive is the "rebate." This is like getting a cash refund after you've made your purchase. Once your solar panels are installed and working, you can apply for a rebate. The government or a special program will then send you a check for a certain amount of money. It's like getting a reward for making a smart choice. Sometimes, they'll even apply the rebate directly to the price of the solar system when you buy it, making it cheaper right from the start.

Then there's the "feed-in tariff." This is a little different. If your solar panels produce more electricity than your home or business uses, you can send that extra electricity back to the power company. And they'll pay you for it! It's like selling your surplus energy back to the grid. This helps you earn money while also using clean energy, which can help pay for the cost of your solar system over time.

Why do governments offer all these incentives? Well, they know that using solar energy is good for everyone. It helps reduce pollution, which means cleaner air and a healthier environment. It also creates jobs in the solar industry, from manufacturing and installing panels to maintaining them. More jobs mean a stronger economy. And by using more solar energy, we become less dependent on fossil fuels from other countries, which makes our energy supply more secure and stable.

For you, the homeowner or business owner, these incentives mean you can save a lot of money. You get help paying for the solar system itself, which makes it more affordable. You also save money on your monthly electricity bills because you're using less energy from the power company. And with feed-in tariffs, you might even earn some extra money by selling your surplus power. Basically, solar incentives make it easier and cheaper to switch to solar. They help you save money while also helping the planet. It’s a win-win situation for everyone involved.

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Looking to build a home solar system? Check out solar panels that we have for sale in Maryland

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Julia Zaraeva
Author

Years of experience in translation and a love of nature help Julia find the right words to encourage going solar. She joined the team in 2023 and is happy to make her contribution to a greener future.

More articles from this author


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