Solar in Maryland: incentives, costs and payback (2025)

Maryland offers strong solar incentives and policies that make solar an attractive investment, particularly in the Baltimore and Washington DC metro areas with their high electricity rates.

Maryland solar incentives

Federal tax credit (30%) The federal solar Investment Tax Credit (ITC) allows you to deduct 30% of your solar installation cost from your federal taxes. This credit is available through 2032.

Solar Renewable Energy Certificates (SRECs) Maryland's SREC programme provides significant ongoing value:

• Earn 1 SREC for every 1,000 kWh your system produces
• SRECs trade for $50-150 each depending on market conditions
• 20-year earning period for residential systems
• Strong utility demand ensures market stability

Property tax exemption Solar energy systems are exempt from property tax assessments, meaning your property taxes won't increase despite the added home value.

Sales tax exemption Solar equipment purchases are exempt from Maryland's 6% state sales tax, providing immediate savings.

Grant programmes Maryland offers various grant programmes:

• Maryland Energy Administration grants for certain residential systems
• Low-to-moderate income programmes with additional incentives
• Local utility rebates from BGE, Pepco, and other providers

Cost and payback in Maryland

Average installation cost Solar panels in Maryland cost an average of $3.20 per watt before incentives. A typical 6kW system costs:

• Gross cost: $19,200
• After federal tax credit (30%): $13,440
• With SREC income: Additional $600-1,200 annually
• After utility rebates: $12,440-13,440 (varies by utility)

Payback time With Maryland's moderate-to-high electricity rates (average $0.14/kWh), net metering, and SREC income, most solar systems pay for themselves in 7-9 years.

Annual savings A typical 6kW system in Maryland generates about 7,800 kWh annually, saving homeowners $1,090 per year on electricity bills, plus SREC income.

Net metering and electricity rates

Maryland's net metering policies are solar-friendly:

• Full retail rate credit for excess power exported to the grid
• Annual rollover of unused credits
• No system size limits for residential installations
• Utility-specific variations in credit timing and structure

Average electricity rates in Maryland are $0.14/kWh, with higher rates in the Baltimore-Washington corridor.

Regional considerations

Maryland's solar potential varies by region:

• Eastern Shore: Best solar irradiance, lower electricity rates
• Baltimore metro: High electricity rates, good solar potential
• Washington DC metro: Highest electricity rates, moderate solar irradiance
• Western Maryland: Good solar irradiance, moderate electricity rates

Utility programmes

Major Maryland utilities offer additional solar support:

• BGE (Baltimore Gas & Electric): Rebates and interconnection support
• Pepco: Solar rebate programmes and net metering
• Delmarva Power: Time-of-use rates that can benefit solar customers
• SMECO: Rural cooperative with solar-friendly policies

Best solar companies in Maryland

Maryland has many qualified solar installers. We recommend getting quotes from:

• SunPower: Premium panels with excellent warranties
• Sunrun: National provider with strong local presence
• Tesla Solar: Competitive pricing with battery storage options
• Local installers: Solar Energy World, Ipsun Solar, Standard Solar

Get quotes from at least three installers to compare pricing and proposals.

SREC market outlook

Maryland's SREC market provides long-term value:

• Current SREC prices: $50-150 per certificate
• Market drivers: Renewable Portfolio Standard requirements
• Price stability: Strong utility demand and compliance needs
• Long-term contracts: Some utilities offer 15-20 year SREC contracts

Next steps

1. Calculate your potential savings with our solar calculator
2. Check utility-specific programmes and interconnection requirements
3. Get multiple quotes from certified installers
4. Review SREC registration process (typically handled by installer)
5. Consider system size optimization to maximize SREC income

Maryland's combination of SRECs, net metering, and tax incentives make solar a smart investment in 2025.

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