Maryland 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 that even though solar panels typically increase your home’s market 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 and continues for as long as you own the solar equipment. There’s no application process required, and no expiration date on the benefit. This makes solar energy more affordable by protecting you from higher property taxes that would otherwise result from this valuable home improvement.

Maryland’s sales tax exemption removes the state’s 6% sales tax from the purchase of solar energy equipment and systems. 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. This exemption applies at the point of sale, providing immediate savings on your solar investment.

The financial benefit depends on the total cost of your solar equipment. For example, on a typical residential solar system costing $25,000 in equipment, this exemption saves you $1,500 in sales tax. The exemption applies to all components of your solar energy system, including panels, mounting hardware, inverters, and battery storage systems. There are no income limits or system size restrictions—any Maryland homeowner purchasing qualifying solar equipment can benefit from this exemption. Your solar installer should automatically apply this exemption at purchase, so you’ll see the savings reflected in your final invoice without needing to file for a refund later.

The Maryland Solar Access Program (MSAP) is a state-funded grant program that helps eligible Maryland homeowners install solar panels on their homes. This program was established through the Brighter Tomorrow Act of 2024 and provides financial assistance to residents who meet specific income requirements. Awards are distributed on a first-come, first-served basis, and the program has a total budget of $12 million for fiscal year 2026.

The application process involves two steps: first, you’ll submit an initial application to reserve your grant funds, and second, you’ll verify completion of your solar installation. Your solar system must be installed by a contractor from the approved Participating Contractor List, and your contract must be executed between June 13, 2025, and June 5, 2026. Applications are accepted through the online portal from July 21, 2025, through June 5, 2026 at 12:00 PM ET.

Important considerations: If your solar system has already received funding from Maryland’s Solar Energy Equity Grant Program, it is not eligible for MSAP funding. The program requires income verification, and full eligibility details are available in the Funding Opportunity Announcement. Contractors participating in this program must comply with specific consumer protection policies. As of November 4, 2025, approximately 23% of the program budget has been reserved, so funds are still available for eligible applicants.

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 exist because Maryland law requires energy suppliers to obtain a certain percentage of their power from solar sources, creating a market where you can sell your SRECs to these suppliers.

The financial value of SRECs fluctuates based on market demand, and there’s no fixed dollar amount. As an example, a typical 10 kW residential solar system producing 12,000 kilowatt-hours annually would generate 12 SRECs per year. You have several options: sell them immediately through an SREC aggregator, sell 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 earning and tracking your credits.

One important consideration: if you sell your SRECs, you’re transferring the environmental claim of using solar energy to the buyer. This means you can no longer say you’re using solar power yourself—though you still benefit from lower electricity bills. If the environmental recognition matters more to you than the income, you can choose to keep your SRECs. Either way, your solar system benefits Maryland’s goal of reaching 14.5% solar energy by 2030.

Net metering in Maryland allows you to receive full retail credit for the excess solar energy your system sends back to the grid. When your solar panels produce more electricity than your home uses, that surplus energy flows to the grid, and you receive a 1:1 credit on your electric bill. This means every kilowatt-hour (kWh) you send to the grid offsets one kWh you might use later, effectively running your meter backwards and reducing your monthly electricity costs.

All major Maryland utilities—including Baltimore Gas & Electric (BG&E), Pepco, Potomac Edison, Delmarva Power, Southern Maryland Electric Cooperative (SMECO), and Choptank Electric Cooperative—offer this 1:1 net metering benefit. Any excess credits you accumulate during sunny months can roll over from month to month throughout the year. However, once per year (typically in April or May, depending on your utility), any remaining credits are “trued-up,” meaning they’re paid out at a lower wholesale rate of approximately $0.04-$0.07 per kWh, and your account resets to zero. It’s worth noting that if you’re a BG&E customer, time-of-use rate schedules are not compatible with net metering, so you’ll need to remain on a standard rate plan to participate in this program.