Maryland Solar Incentives Available in 2023

Maryland Solar Incentives and Tax Credits

What are the Top Solar Rebates and Incentive Programs in Maryland?

As of 2023, Maryland offers multiple solar incentives to help residents reduce the costs of solar installations, making it more affordable to transition to clean energy.

Some of the top solar rebate and incentive programs include the Maryland Solar System Sales Tax Exemption, Solar Incentives and Rebates, Solar Renewable Energy Certificates (SREC), Maryland Renewable Energy System Property Tax Exemption, and Maryland Residential Clean Energy Grant Program.

Overall, there are no programs that offer free solar panels in Maryland. However, there are still many ways to cut costs and save.

Understand Your Options

Understanding Financial Benefits of Going Solar in Maryland

When considering solar panel installations, it’s vital to understand your options for solar incentives and programs available in Maryland for 2023. By identifying these programs, you can significantly offset the costs of installing solar panels and benefit from the sustainable energy option in your home.

Maryland Solar System Sales Tax Exemption

Maryland offers a sales tax exemption for solar energy equipment, making purchasing solar panels more affordable. Qualifying solar systems will be exempt from the state’s sales and use tax.

Solar Incentives and Rebates in Maryland

In 2023, Maryland has several solar incentives and rebates to help you offset the cost of solar panel installations. For example, the Maryland Solar Incentives, Tax Credits & Rebates program offers a $1,000 rebate for eligible solar installations smaller than 20 kilowatts (kW) located at the primary residence.

Solar Renewable Energy Certificates (SREC)

SRECs in Maryland

Solar Renewable Energy Certificates (SRECs) are available for Maryland residents who generate clean, renewable energy using solar panels. These certificates represent the environmental benefits and can be sold or traded in the marketplace, providing additional financial savings.

Maryland Renewable Energy System Property Tax Exemption

As a Maryland resident, installing a solar panel system on your property may make you eligible for a property tax exemption. This incentive allows you to benefit from the added value of solar energy without being taxed for the increased property value.

Maryland Solar Renewable Energy Credits (SREC) Program

The Maryland Solar Renewable Energy Credits (SREC) Program allows homeowners to earn solar credits for every megawatt-hour (MWh) of electricity their solar panels generate. These credits can be sold, generating an additional income stream that helps offset the cost of solar panel installation.

Maryland Residential Clean Energy Grant Program

The Maryland Residential Clean Energy Grant Program offers financial assistance to residents installing solar panels. The program provides eligible homeowners with a grant of up to $1,000, which can be used to reduce the upfront costs of purchasing and installing a solar system.

The Federal Solar Tax Credit

The Federal Solar Tax Credit, or the Investment Tax Credit (ITC), is a significant incentive for homeowners in Maryland and across the United States to consider installing solar panels on their property. This tax credit enables homeowners to reduce their federal income tax liability by 30% of the cost of their solar panel system.

Federal Solar Tax Credit

The ITC has been a crucial factor in the solar industry’s growth since its inception in 2005. It has made solar power more affordable for homeowners and encouraged innovation. The credit applies to both residential and commercial installations.

To claim the credit, homeowners should ensure they are eligible for the ITC. The solar panel system must be installed on the homeowner’s property and be new and unused. The system must also be in service during the specified tax year.

When filing their federal income tax return, homeowners can claim the ITC by completing IRS Form 5695, “Residential Energy Credits.” It is essential to keep all documentation, receipts, and proof of installation for future reference and tax purposes.

It is important to note that the ITC is a non-refundable tax credit. The excess will only be refunded if the credit amount is within the taxpayer’s federal income tax liability. However, any remaining amount can be carried forward to future years.

Average Cost of Solar Panels in Maryland

The cost of installing solar panels in Maryland varies. Still, it’s essential to know the average expenses for homeowners interested in going solar. Most Maryland homeowners pay an average of $19,390 to install a solar panel system. This cost is after considering the federal solar investment tax credit (ITC), bringing down the typical pre-credit expense from $27,700.

Average Cost of Solar Panels in Maryland is Below National Average

Solar panel prices are determined based on the wattage necessary to meet individual energy requirements. Maryland’s average cost per watt is $2.74, slightly lower than the national average of $3.00 per watt. A typical 6,000-watt (6 kW) solar system would cost roughly $11,500 in Maryland after claiming the 30% federal solar tax credit.

Please note that these costs indicate the state’s average expenses and can fluctuate depending on individual homeowners’ needs, location, panel type, and installation company. Additionally, some solar programs and incentives are available in Maryland, which can aid in reducing these costs and making solar more accessible to residents. These programs and incentives include local community initiatives, federal tax credits, solar rebates, and, in some cases, free solar panel installations.

Power Purchase Agreements

Power Purchase Agreements (PPAs) are a popular financing option for homeowners in Maryland who want to install solar panels with little or no upfront cost. In a PPA, the homeowner agrees to purchase the electricity generated by the solar panels at a fixed rate from the installation company. The company, in turn, covers the cost of the solar panels, equipment, and maintenance.

Power Purchase Agreements Yield No Tax Benefits

One benefit of a PPA is the predictability of the electricity rate, which can create long-term savings for the homeowner. The fixed rate is typically lower than the rates charged by utility companies in Maryland. Homeowners need not worry about the maintenance and repair expenses, as the installation company handles them.

However, homeowners should know that a PPA has a fixed term of 15 to 25 years. This means that the homeowner is contractually obligated to buy electricity from the installation company for the duration of the PPA.

If they decide to sell their property before the end of the term, the new owner must agree to take over the PPA. Alternatively, they can buy out the remaining value of the PPA to release the contract. Another financing option available in Maryland is a solar lease. Like a PPA, a solar lease involves the homeowner leasing the solar panels from the installation company and paying a fixed monthly fee.

However, unlike a PPA, the homeowner does not purchase the electricity generated by the solar panels. Instead, they benefit from the lower electricity rates achieved through solar energy.

PPAs and solar leases offer opportunities for homeowners to access solar energy without the need for significant upfront investment. They can choose the best option for their financial and long-term energy goals.

How Can I Find the Right Maryland Solar Installer?

Finding the right Maryland solar installer is essential in ensuring a successful solar panel installation for your home or business. Many reputable regional solar companies have experience designing and installing customized solar energy systems to meet your unique needs.

Solar Installers in Maryland

One way to find a reliable solar installer in Maryland is to compare the top-rated solar companies based on shopper preferences. Google of course provides updated rankings and customer reviews of solar installers in the area. You can understand the installers’ service quality, responsiveness, and overall performance by comparing customer feedback and ratings.

Another helpful resource for Maryland residents seeking solar panel installation is the Maryland Energy Administration (MEA). The MEA offers expert information and grants to help you navigate the solar installation process. Through their guides and additional resources, you can learn about different installation options, available incentives, and tips to make an informed decision when selecting a solar installer.

When evaluating potential solar installers in Maryland, consider their experience, certifications, warranties, and overall expertise in solar energy installations. A qualified solar installer should have a good track record of successful installations, hold relevant certifications such as the North American Board of Certified Energy Practitioners (NABCEP), and be knowledgeable about Maryland-specific solar incentives and programs.

Lastly, obtaining multiple quotes from different solar companies before deciding is essential. Comparing prices, services, and warranties will help you find the best solar company and installer to meet your budget and energy needs. Remember to ask for detailed quotes, including equipment costs, labor fees, and any additional expenses related to your solar installation project.

How Many Times Can You Claim the Solar Tax Credit?

The Solar Tax Credit, or the federal residential solar energy credit, is a valuable incentive encouraging homeowners to install solar photovoltaic (PV) systems. This tax credit allows taxpayers to claim a certain percentage of the cost incurred on a solar PV system against their federal income tax liability.

Claim Solar Tax Credit on Eligible Energy Upgrades

Understanding how often you can claim this tax credit if you plan to install multiple solar PV systems, expand an existingsolar energy system, or upgrade specific components is essential. Generally, it is possible to claim this tax credit numerous times as long as each solar PV system qualifies. However, there are a few things to remember when claiming the Solar Tax Credit multiple times.

First and foremost, each solar PV system must meet the eligibility requirements outlined by the federal government, which may include rules related to the installation date, ownership, and other factors. Make additional upgrades or expansions to an existing solar PV system. The costs associated with these improvements should qualify for the credit as long as they meet the eligibility criteria.

Moreover, it is crucial to note that the overall tax credit amount is capped based on your federal income tax liability. Suppose your tax liability is lower than the credit amount. In that case, you can carry unused credit to the next tax year. Ensure that you understand the limits imposed by the federal government and consult a tax professional if you are unsure about claiming the Solar Tax Credit multiple times.

The Solar Tax Credit can be claimed multiple times as long as each claim pertains to qualifying solar PV system costs and stays within the federal income tax liability limits. Be sure to familiarize yourself with the eligibility requirements and seek professional advice to navigate this valuable tax incentive confidently.

What Cities in Maryland Have Local Solar Incentives?

Many cities in Maryland offer local solar incentives to encourage residents to switch to clean, renewable energy. These incentives vary among cities and counties, making solar installations more affordable and attractive for homeowners.

Anne Arundel County and Other Cities in Maryland Have Various Local Solar Incentives

In Anne Arundel County, homeowners can benefit from property tax credits for installed solar panels and geothermal energy systems. This incentive helps reduce the financial burden of installing solar panels by providing a credit on property tax bills.

Baltimore offers a property tax credit to residential and commercial property owners who install solar energy systems, helping offset the installation cost. Additionally, the city supports solar projects through the Clean Energy Grant Program, which provides funding for clean energy initiatives.

In Cecil County, the Solar Electric Grant Program provides financial support to businesses and nonprofits looking to install solar electric systems. This program promotes the use of renewable energy and reduces reliance on fossil fuels.

Dorchester, Harford, and Howard Counties provide property tax credits for installing solar energy systems. This incentive encourages homeowners to switch to solar energy, contributing to the state’s goal of increasing renewable energy sources.

Montgomery County offers the Residential Clean Energy Rebate Program, which provides homeowners with rebates for installing solar photovoltaic systems. In this program, homeowners can receive up to $250 for every kW of installed solar capacity, making the switch to solar more affordable.

Prince George’s County has implemented a property tax credit for solar energy systems, supporting the growth of clean energy adoption in the area. Moreover, the Prince George’s County Clean Energy Grant Program offers financial support for clean energy projects within the county.

Talbot, Wicomico, and Baltimore Counties, along with cities like Frederick, Rockville, Gaithersburg, Bowie, Hagerstown, Annapolis, College Park, Salisbury, and Laurel, also offer various local solar incentives and rebate programs. These programs aim to promote the use of solar energy, reduce greenhouse gas emissions, and create a sustainable environment for their communities.

Investing in Solar Panels in MD

Investing in solar panels can be an intelligent decision for Maryland homeowners who want to save on energy costs and reduce their carbon footprint. While getting completely free solar panels may not be possible, Maryland residents can access various financial incentives and programs that make investing in solar more affordable.

Investing in Solar Panels MD

One of the financial incentives available for Maryland homeowners is the Residential Clean Energy Rebate Program, which offers a rebate of up to $1,000 for installing solar panels. This program is on a first-come, first-served basis, making it essential to act quickly when considering solar panel installation. Additionally, the state offers an income tax credit for energy storage systems, such as solar batteries.

Although free solar panels may not be an option, working with a Maryland solar installer can help homeowners evaluate their needs and financial situation to determine the best solar investment for their homes. Experienced installers can guide homeowners through the various incentives and programs available, making investing in solar in Maryland more accessible and cost-effective.

While free solar panels may not be feasible in Maryland, the state’s incentives and programs can make solar panel installation an intelligent and affordable investment for homeowners. This investment not only contributes to a cleaner environment but also results in long-term savings on energy bills.