Solar Guide

Maryland’s Property Tax Exemption for solar energy systems is a state-level incentive that removes solar installations from your property tax calculations. This means that when you install solar panels or other qualifying solar equipment on your home, the added value from that equipment won’t increase your annual property tax bill. The exemption applies to both solar photovoltaic systems that generate electricity and solar thermal systems that provide hot water.

The financial benefit varies based on your home’s location and local tax rates, but it can save you hundreds of dollars annually. For example, if your solar system adds $20,000 in value to your home and your local property tax rate is 1%, you would save $200 per year in property taxes. The exemption applies to any solar energy equipment installed on residential property, including panels, inverters, and related components. There are no income restrictions or application deadlines – the exemption automatically applies once your solar system is installed and begins operating. This incentive works alongside other solar benefits and remains in effect for as long as you own the solar equipment.

Maryland’s Sales Tax Exemption for solar energy systems eliminates the state’s 6% sales tax on the purchase of solar equipment and installation materials. 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 other system components.

The exemption applies to all solar energy equipment purchased for residential use in Maryland, with no income limits or system size restrictions. There are no application deadlines or time limitations – the exemption is available year-round for any qualifying solar purchase. Homeowners should ensure their solar contractor applies this exemption at the point of sale, and they may need to provide documentation that the equipment is being used for solar energy generation to qualify for the tax-free purchase.

The Maryland Solar Access Program is a state-funded grant program that helps eligible Maryland residents install solar panels on their homes. Created through the Brighter Tomorrow Act of 2024, this program provides direct financial assistance to make solar energy more accessible and affordable for homeowners who meet specific income requirements.

The program operates on a first-come, first-served basis with a two-step application process. First, eligible homeowners reserve funding through an initial application. Then, they have 180 days to complete their solar installation with an approved contractor from the state’s participating contractor list. The exact grant amounts are not specified in the available information, but the program had a $15 million budget for fiscal year 2025, with about 47% already reserved as of June 2025.

To qualify, homeowners must meet income requirements detailed in the program’s funding announcement. Only solar systems installed by contractors on the state’s approved participating contractor list are eligible for grants. Important note: homes that have already received funding from Maryland’s Solar Energy Equity Grant Program cannot receive additional funding through this program.

The FY25 program stopped accepting applications on June 13, 2025, and the FY26 program is expected to open in July 2025. Homeowners interested in future funding should monitor the Maryland Energy Administration website for updates and ensure their chosen contractor is on the approved list before signing any contracts.

Solar Renewable Energy Credits (SRECs) are special certificates that Maryland homeowners earn for every 1,000 kilowatt-hours (1 megawatt-hour) of solar energy their system produces. Think of them as rewards for generating clean energy – you get one SREC for each megawatt-hour your solar panels create. 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.

While the source doesn’t specify exact dollar amounts, SRECs have market value that fluctuates based on supply and demand. For example, a typical 10kW home solar system producing 12,000 kilowatt-hours annually would generate 12 SRECs per year. 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. SRECs have a 3-year lifespan, giving you flexibility to sell immediately or hold them for potentially better prices. Keep in mind that if you sell your SRECs, you can no longer claim to be using solar energy yourself – that environmental benefit transfers to the buyer.

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 normally pay for electricity.

These credits accumulate on your account and can be used to offset your electricity costs during months when your solar system produces less energy, such as during winter or cloudy periods. However, any unused credits are settled annually at a lower rate. Most Maryland utilities, including Baltimore Gas & Electric, Pepco, and Potomac Edison, cash out remaining credits in May at approximately $0.05-$0.07 per kWh. Delmarva Power and Choptank Electric Cooperative settle credits in April, while Southern Maryland Electric Cooperative pays around $0.04-$0.05 per kWh for excess credits.

It’s important to note that Baltimore Gas & Electric customers on time-of-use rate schedules are not eligible for net metering. The program is designed to help homeowners maximize their solar investment by ensuring they receive fair compensation for the clean energy they contribute to Maryland’s electrical grid.