Maryland

Maryland’s Property Tax Exemption for solar energy systems removes your solar installation from your property tax assessment. This means you won’t pay any additional property taxes on the value that your solar panels add to your home, even though they typically increase your property’s market value.

The financial benefit varies based on your local property tax rate and the value of your solar system. For example, if your solar installation adds $20,000 to your home’s value and your local property tax rate is 1%, you would save $200 per year in property taxes. This exemption applies to both solar panels that generate electricity for your home and solar thermal systems that heat water.

To qualify, you must install solar energy equipment on residential property in Maryland. The law covers equipment that uses solar energy to generate electricity for use in your home or to supply power back to the electric grid, as well as solar systems that provide hot water. There are no income restrictions or application deadlines – the exemption automatically applies once your system is installed and assessed.

This exemption continues for as long as you own the solar equipment, making it a long-term benefit that reduces your annual property tax bill. The savings are automatic – you don’t need to file any special paperwork beyond your normal property tax processes.

Maryland’s Sales Tax Exemption for solar energy systems eliminates the state’s 6% sales tax on the purchase of solar equipment and installation services. This means homeowners can save hundreds or even thousands of dollars on their solar investment, as they won’t pay sales tax on solar panels, inverters, batteries, mounting equipment, and related installation services.

All Maryland residents who purchase qualifying solar energy equipment are eligible for this exemption – there are no income limits, system size restrictions, or special application requirements. The exemption applies automatically at the point of sale when you purchase solar equipment from any vendor in Maryland. This incentive has no expiration date and can be combined with federal tax credits and other state incentives to maximize your solar savings. Since this is a sales tax exemption rather than a rebate, you’ll see the savings immediately when you make your purchase.

The Maryland Solar Access Program (MSAP) is a state-funded grant program that helps eligible Maryland residents install solar panels on their homes. This program provides direct financial assistance to make solar energy more affordable for homeowners who meet specific income requirements. The program operates on a first-come, first-served basis rather than as a competitive application process.

While the program documents don’t specify exact grant amounts, the FY26 program has a total budget of $12 million available for eligible projects. To qualify, homeowners must meet income requirements detailed in the program’s funding announcement and work with an approved contractor from the state’s participating contractor list. Applications are accepted through a two-step process: an initial application to reserve funds, followed by installation completion verification.

The FY26 program accepts applications from July 21, 2025, through June 5, 2026, at 12:00 PM ET. Solar contracts executed starting June 13, 2025, are eligible if the contractor is approved by the state. Important considerations include that homes already receiving funding from Maryland’s Solar Energy Equity Grant Program are not eligible for this program, and only installations by state-approved contractors qualify for grants.

Solar Renewable Energy Credits (SRECs) are special certificates that Maryland homeowners earn for every 1,000 kilowatt-hours (1 megawatt-hour) of electricity their solar panels produce. Think of them as rewards for generating clean energy – you get one SREC for each megawatt-hour your system creates. These credits can be sold to energy suppliers who need them to meet Maryland’s renewable energy requirements, creating an additional income stream beyond your electricity savings.

The financial value of SRECs varies based on market demand, and the source doesn’t specify exact dollar amounts since prices fluctuate. However, homeowners have flexibility in how they use their SRECs – you can sell them immediately, hold them for up to 3 years hoping for better prices, sell directly to energy suppliers, or work with an SREC aggregator. To participate, you must register your solar system with the Maryland Public Service Commission within 30 days of installation, then register with PJM’s Generator Attribute Tracking System. Keep in mind that if you sell your SRECs, you can no longer claim to be using solar energy yourself, as the buyer gets those environmental bragging rights.

Net metering in Maryland allows homeowners with solar panels to receive full retail credit for the excess electricity their system produces and sends back to the grid. When your solar panels generate more power than your home uses during sunny periods, that extra energy flows into the electrical grid and you receive a 1:1 credit on your electric bill – meaning you get the same rate you pay for electricity from your utility company.

The financial benefit works on a monthly rollover system where unused credits carry forward from month to month throughout the year. However, each utility company handles the annual settlement differently: Baltimore Gas & Electric, Pepco, and Potomac Edison cash out remaining credits in May at a reduced rate of $0.05-$0.07 per kWh and reset your account to zero. Delmarva Power and Choptank Electric Cooperative settle accounts each April at their commodity rate, while Southern Maryland Electric Cooperative pays out at approximately $0.04-$0.05 per kWh. It’s important to note that BG&E customers on time-of-use rate schedules cannot participate in net metering, so you’ll need to be on a standard residential rate to qualify for this program.