Gaithersburg, 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’s completely 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.

This exemption applies to equipment installed to use solar energy to generate electricity for use in your home or to supply power to the electric grid, as well as solar thermal systems that provide hot water. The exemption is automatic once your solar system is installed—there’s no application process or annual renewal required. This benefit continues for as long as you own the solar equipment, providing ongoing savings that make your investment in clean energy even 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. This means when you buy solar panels, inverters, batteries, and other qualifying solar equipment in Maryland, 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 and businesses purchasing qualifying solar energy equipment. There are no income restrictions, system size limitations, or application requirements—the tax exemption is automatically applied at the point of sale by your solar installer or equipment vendor. The exemption applies to both the equipment itself and any materials directly incorporated into your solar energy system. However, it’s important to note that general construction materials, tools, and labor services remain subject to standard sales tax rates. Your solar provider should clearly itemize which components qualify for the exemption on your purchase invoice.

The Maryland Solar Access Program (MSAP) is a state-funded grant program that helps eligible Maryland homeowners install solar panel systems on their homes. Established through the Brighter Tomorrow Act of 2024, this program provides direct financial assistance to residents who meet specific income requirements. The program operates on a first-come, first-served basis, meaning applications are processed in the order they’re received until funding runs out.

The program has a total budget of $12 million for fiscal year 2026. Grant amounts vary based on individual circumstances and system size—you can use the program’s Maximum Offer Calculator to estimate your potential grant. The application process involves two steps: first, you’ll reserve funds with an initial application, then you’ll complete a verification after your solar installation is finished. Applications are accepted from July 21, 2025 through June 5, 2026 at 12:00 PM ET.

To qualify, you must meet the program’s income requirements 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’s not eligible for this program—no exceptions are made. You can apply directly or have your contractor apply on your behalf through the online portal.

Solar Renewable Energy Credits (SRECs) are tradable certificates that represent the environmental benefits of solar energy production. For every 1,000 kilowatt-hours (1 megawatt-hour) your solar system generates, you earn one SREC. These credits exist because Maryland law requires energy suppliers to obtain a certain percentage of their power from solar sources—14.5% by 2030. When suppliers can’t generate enough solar energy themselves, they purchase SRECs from homeowners like you to meet their legal requirements.

The financial value of SRECs fluctuates based on market demand, and you have several options for monetizing them. You can sell your SRECs directly to energy suppliers, work with an SREC aggregator who sells them on your behalf as part of a larger group, or hold onto them for up to three years in hopes of a better price. For example, a typical 10-kilowatt residential system producing 12,000 kilowatt-hours annually would generate 12 SRECs per year. The actual dollar amount you receive depends on current market rates, which vary throughout the year.

To participate, you must register your solar system with the Maryland Public Service Commission within 30 days of installation, then complete registration through PJM Interconnection’s Generator Attribute Tracking System (GATS). One important consideration: if you sell your SRECs, you’re selling the environmental attributes of your solar energy to the buyer. This means they can claim to be using solar energy, not you. If maintaining the environmental bragging rights matters to you, you can choose to keep your SRECs rather than selling them—the environmental benefit to Maryland remains the same either way.

Net metering in Maryland allows you to earn credits on your electricity bill for the excess solar energy your system produces. When your solar panels generate more electricity than your home uses, that surplus power flows back to the grid, and your utility company credits your account at a 1:1 rate. This means you receive the full retail electricity rate for every kilowatt-hour (kWh) you send to the grid, which you can then use to offset future electricity charges when your panels aren’t producing enough power (like at night or on cloudy days).

All major Maryland utilities participate in net metering, including Baltimore Gas & Electric (BG&E), Pepco, Potomac Edison, Delmarva Power, Southern Maryland Electric Cooperative (SMECO), and Choptank Electric Cooperative. Your monthly excess credits roll over from month to month throughout the year, giving you flexibility to use them when you need them most. However, each utility conducts an annual “true-up” period between April and May, depending on your provider. During this true-up, any remaining excess credits are paid out at a lower wholesale rate (typically between $0.04 and $0.07 per kWh), and your account resets to zero. It’s worth noting that if you’re a BG&E customer, the three time-of-use (TOU) rate schedules are not compatible with net metering, so you’ll need to remain on a standard rate plan to participate.