Annapolis, MD Solar Panels

Maryland’s Property Tax Exemption for solar energy systems ensures that adding solar panels to your home won’t increase your property taxes. When you install solar equipment, it becomes exempt from real property tax assessment. This means even though solar panels typically increase your home’s value, that added value won’t be factored into your annual property tax bill.

The exemption applies to equipment installed to use solar energy to generate electricity for use in your home or to supply power back to the electric grid, as well as solar thermal systems that provide hot water. There are no income requirements or application deadlines—the exemption automatically applies once your solar system is installed. This benefit continues for as long as you own the solar equipment, providing ongoing savings that make your investment in clean energy more affordable over time.

Maryland’s Sales Tax Exemption removes the state’s 6% sales tax from the purchase of solar energy equipment and systems for residential use. This means when you buy solar panels, inverters, batteries, and related equipment for your home, you won’t pay the sales tax that would normally apply to these purchases. For a typical residential solar system costing $25,000, this exemption saves you approximately $1,500 at the time of purchase.

This exemption is available to all Maryland homeowners who purchase qualifying solar energy equipment. The equipment must be used to generate electricity or heat for residential purposes. Your solar installer will typically apply this exemption automatically at the point of sale, so you won’t see the sales tax added to your invoice. There are no income requirements, application processes, or deadlines to worry about—the exemption applies to all eligible solar purchases in Maryland. Keep your purchase documentation, as you may need it for record-keeping purposes, though no special forms need to be filed to claim this benefit.

The Maryland Solar Access Program (MSAP) is a state-funded grant program that helps income-qualified Maryland homeowners install solar panels on their homes. Established through the Brighter Tomorrow Act of 2024, this program provides direct financial assistance to eligible residents on a first-come, first-served basis. The program operates through a two-step application process: first, you reserve funds with an initial application, then you complete verification after your solar installation is finished.

The program has a total budget of $12 million for fiscal year 2026. The exact grant amount varies based on your household income and system size, and you can use the program’s Maximum Offer Calculator to estimate your potential benefit. Applications are accepted from July 21, 2025 through June 5, 2026, though funding may run out before the deadline since awards are made on a first-come, first-served basis. As of the last update, 52% of funding has been requested and 23% has been reserved.

To qualify, you must meet specific income requirements detailed in the program’s Funding Opportunity Announcement and work with an approved contractor from the Participating Contractor List. Your solar contract must be executed on or after June 13, 2025. Important note: if your solar system has already received funding from Maryland’s Solar Energy Equity Grant Program, it is not eligible for this program—no exceptions are made. You’ll need to apply through the online portal, where you can track your application status and save your progress.

Solar Renewable Energy Credits (SRECs) are tradable certificates that represent the environmental benefits of your solar energy production. For every 1,000 kilowatt-hours (1 megawatt-hour) your solar system generates, you earn one SREC. These credits have real monetary value because Maryland requires electricity suppliers to obtain a certain percentage of their power from solar sources—14.5% by 2030. Suppliers purchase SRECs from solar system owners like you to meet this requirement, creating a market where you can sell your credits for income.

The financial benefit varies based on market demand, but homeowners typically earn one SREC for every 1,000 kWh their system produces. For example, a 10 kW solar array producing 12,000 kWh annually would generate 12 SRECs per year. You can sell these credits through an aggregator, directly to energy suppliers, or hold them for up to 3 years hoping for better prices. 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 (GATS) to start tracking and selling your credits.

Keep in mind that selling your SRECs means transferring the environmental claims of your solar production to the buyer. If you want to personally claim you’re using solar energy, you’ll need to keep your SRECs rather than sell them. Either way, your solar system benefits Maryland’s environment and helps the state reach its clean energy goals.

Net metering in Maryland allows you to receive full retail credit for the excess solar energy your system sends back to the electric grid. When your solar panels produce more electricity than your home uses, that surplus energy flows to the grid, and you receive a credit on your electric bill at a 1:1 rate. This means every kilowatt-hour (kWh) you send to the grid offsets one kWh you would otherwise pay for at the full retail rate. These credits accumulate on your bill and can be used to offset energy you draw from the grid during times when your panels aren’t producing enough power, like at night or on cloudy days.

All Maryland homeowners with solar systems are eligible for net metering, though the specific details vary by utility company. Your monthly excess credits roll over from month to month throughout the year, helping you manage seasonal variations in solar production. However, it’s important to know that most Maryland utilities conduct an annual “true-up” where any remaining excess credits are cashed out at a lower rate—typically between $0.04 and $0.07 per kWh depending on your utility. This true-up happens in April or May depending on your provider, and your credit balance resets to zero afterward. If you’re a Baltimore Gas & Electric customer, note that the three Time-of-Use rate schedules are not compatible with net metering. To maximize your benefit, it’s best to size your solar system to match your annual energy usage rather than significantly overproduce.