As memorably captured in the movie Wedding Crashers, Maryland has long been famous for its crabcakes as well as its football – but it’s also become one of the leading states for solar on the east coast. According to data from the Solar Energy Industries Association (SEIA), Maryland residential solar installations topped 100 MW for the first time in 2015, surpassed 150 MW in 2016, and are expected to exceed 200 MW in 2017!
What’s the secret to this success? It’s not Old Bay Seasoning – although the state’s most famous condiment is a delicious addition to just about anything. Like most states on the home solar leader-board, Maryland has benefitted by offering homeowners several types of incentives that can reduce the cost of solar as well as enhance its value over the life of your investment.
Maryland’s Incentive Playbook
As in many states, Solar Incentives for Maryland includes a long-running net metering policy allows you to receive a full electricity bill credit for every kilowatt-hour of solar you generate. With average state residential electricity prices of 14.25 cents per kilowatt-hour at the start of 2017, those bill credits can add up in a hurry! And like any other U.S. resident, Maryland homeowners can benefit from the federal Residential Renewable Energy Tax Credit, which lets you recoup up to 30% of the cost of going solar when you pay your income taxes.
Those two incentives alone can make going solar worth it for many homeowners! But Maryland has gone even further to sweeten the pot with several additional incentives.
Maryland Solar Rebates: Maryland’s Residential Clean Energy Grant Program provides rebates for a range of home energy technologies, including solar PV installations of up to 20 kW in size. Currently, you can receive a $1,000 rebate once their system is installed – although it should be noted that, like the federal tax credit, it is only available if a homeowner purchases their system outright with cash or a loan. Trinity can help you determine which of our solar financing options makes sense, including loans as well as third-party agreements.
Tax Exemptions and Credits: Solar equipment is also exempt from Maryland’s sales and use tax, currently 6%, as well as property taxes. Uniquely, Maryland has also added a “local option” allowing counties to offer property tax credits for solar that allow you to count a portion of your installation costs against your larger property tax bill. So far, the counties of Anne Arundel, Harford, Baltimore, Montgomery, and Prince George’s County have all taken advantage of this option to offer credits ranging from $2,500 to $5,000.
Renewable Portfolio Standard (RPS) and SRECs: Like many states, Maryland requires its utilities to source a given amount of their electricity from renewable sources with its Renewable Portfolio Standard (RPS) policy, including a certain portion from solar specifically. And in February, the state legislature passed a major RPS enhancement bill that will increase the state mandate from 20% to 25% renewables by 2020, including a bump up of the solar carve-out from 2% to 2.5%. To meet the solar part of this mandate, utilities buy Solar Renewable Energy Certificates, or SRECs, from commercial solar farms as well as home solar installations.
One SREC is generated from every megawatt-hour of solar electricity generated – or, one for every 1,000 kilowatt-hours. For example, a typical 5 kW residential solar system might generate 5 megawatt-hours of electricity per year, yielding 5 SRECs that can then be sold to utilities based on current market prices. While the prices of these SRECs can vary, the new legislation should help keep utility demand robust for the foreseeable future. And if you want to avoid the hassle of selling SRECs yourself, Trinity can help you receive their expected value in an up-front payment through our financing partners.
Solar Leadership on the Chesapeake
Even with all this success, Maryland isn’t resting on its laurels, and it’s recently been pushing the envelope with some of the boldest clean energy policy initiatives in the country. In just the past few months, it has passed three major pieces of forward-thinking legislation, including the aforementioned upgrade of the state’s Renewable Portfolio Standard (RPS) in the Clean Energy Jobs Act, an expansion of Maryland’s EmPOWER energy efficiency program, and the first state tax credit for residential energy storage in the country.
At this rate, Maryland’s clean energy dynasty is only beginning – click here to learn more about how Trinity can get you over the solar goal line.