Bethesda, MD

Maryland’s Property Tax Exemption for solar energy systems removes your solar installation from your property tax calculations. This means that while your solar panels may increase your home’s actual value, you won’t pay any additional property taxes on that increased value. The exemption applies to all equipment installed to use solar energy to generate electricity for your home or to supply power back to the electric grid, as well as solar hot water systems.

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 annually in property taxes. This exemption continues for as long as you own the solar equipment, providing ongoing savings year after year. The law applies to both residential and commercial solar installations, and there are no income restrictions or application deadlines – the exemption automatically applies once your system is installed and assessed.

Maryland’s Sales Tax Exemption for solar energy systems eliminates the state’s 6% sales tax on solar equipment purchases. This means when you buy solar panels, inverters, batteries, and other qualifying solar equipment in Maryland, you won’t pay the standard sales tax that applies to most other purchases. For a typical residential solar system costing $20,000, this exemption saves homeowners approximately $1,200.

The exemption applies to all solar energy equipment and components purchased for residential use in Maryland. There are no income restrictions, system size limits, or application processes required – the tax exemption is automatically applied at the point of sale when you purchase qualifying solar equipment. This incentive works alongside other solar programs and can be combined with federal tax credits and any local incentives to reduce your overall solar investment costs.

It’s important to work with reputable solar installers who understand Maryland’s tax exemption requirements to ensure your equipment qualifies. Keep all purchase receipts and documentation, as these may be needed for warranty purposes or if you decide to sell your home and transfer the solar system to new owners.

The Maryland Solar Access Program 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 accessible and affordable for homeowners who meet specific income requirements. The program operates on a first-come, first-served basis, meaning applications are processed in the order they are received.

While the exact grant amount is not specified in the available information, the program has a total budget of $15 million for fiscal year 2025, with nearly half already reserved for eligible projects. To qualify, homeowners must meet income requirements detailed in the program’s official documentation. The application process involves two steps: first reserving funds through an initial application, then completing installation verification within 180 days of fund reservation.

Important considerations include that solar installations must be completed by contractors on the program’s approved Participating Contractor List, and systems that have already received funding from Maryland’s Solar Energy Equity Grant Program are not eligible. Homeowners should also be aware that the program includes consumer protection policies and requires specific disclosure forms depending on whether the solar system is purchased outright or through lease/power purchase agreements.

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 certificates have real value and can be sold to energy suppliers who need them to meet Maryland’s renewable energy requirements.

While the source doesn’t specify exact dollar amounts, SRECs do provide ongoing financial value that homeowners can either keep or sell. For example, a typical 10-kilowatt home solar system producing 12,000 kilowatt-hours annually would earn 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 remain valid for 3 years, giving you flexibility in when to sell them. 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 pay for electricity from your utility company.

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, the financial benefit varies by utility company across Maryland. At the end of each program year (typically in April or May), any remaining excess credits are paid out at a lower rate ranging from approximately $0.04 to $0.07 per kilowatt-hour, depending on your utility provider. After this annual settlement, your credit balance resets to zero.

All major Maryland utilities participate in this program, including Baltimore Gas & Electric, Pepco, Potomac Edison, Delmarva Power, Southern Maryland Electric Cooperative, and Choptank Electric Cooperative. It’s important to note that if you’re a Baltimore Gas & Electric customer, you cannot combine net metering with certain time-of-use rate schedules, so you’ll want to discuss your rate options with your utility company when installing solar panels.