* Cost data based on quotes for fully-installed solar panel systems submitted on our platform. Prices are shown after applying the 26% federal tax credit.
Maryland had previously been a power player in the solar industry when it came to incentives. However, as the value of SRECs decreased because of an oversaturated market and utility incentives reached their capacity limits, solar in Maryland became a little less juicy a financial proposition.
However, a recent change to the state’s renewable portfolio standard may start to drive utilities to extend their incentives. The state’s net metering policy, the federal tax credit, and the remaining incentives still lead to a great return on investment on residential solar panels in Maryland.
The average cost for an installed residential solar system in Maryland is currently $12,157 after claiming the 26% federal solar tax credit. This is $2.74 per watt. However, there is some variance in solar prices in different parts of the state. The graph below shows the average cost of installed solar systems in your part of the state.
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Prices based on a 5.8kW system, after 26% federal tax credit
Solar panels have fallen in price by more than 80% in the last ten years. In 2020 they also remain subsidized by the 26% federal tax credit and the net metering law, making them an excellent investment. They offer a return well above the long term average return from both the share market and also property investment.
Another way to look at this question is the levelized amount you will pay for each kWh of power you will use over the next 25 years with and without solar panels. As you can see below the savings are significant.
(forecast avg Maryland electric rates over the next 25 years)
The most significant incentive to install solar panels for homes and businesses in Maryland is the federal solar tax credit. At the end of 2020, the amount of the credit will decrease from 26% to 22% of the cost of the solar installation.
Because home and business owners want to get the largest incentive amount possible, solar panel installation companies will likely be flooded with new projects before year’s end. In order to maximize your savings potential, the best time to go solar in Maryland is now.
Investor-owned utilities in Maryland are required to offer their customers net metering. So, if your solar system produces more energy than you use in a billing period, your utility will pay you for the excess energy that your system produced - at the retail rate of electricity.
Since electricity rates are so high in Maryland, net metering can save homeowners a pretty penny on their electric bills.
Maryland has created a solar renewable energy certificate market (SREC), based on the state’s commitment to derive 14.5% of its electricity mix from solar energy by 2030. Luckily for you as a solar homeowner, that is a direct benefit to you.
Current market prices are about $75 per SREC. An average 10kW solar installation in Maryland will produce about 13 SRECs annually. That amounts to $900 in SRECs you can sell annually back to your utility company, in addition to your electric bill savings.
Maryland legislators have created a battery backup tax credit of 30% of your installed costs up to $5,000. When you go solar, you can combine the Federal tax credit with this one to reap big savings on your home solar energy and energy storage system here.
Maryland has also crafted a Clean Energy Grant. This solar incentive provides an upfront rebate of $1,000 per solar system installed, in order to help reduce upfront installation costs.
Thanks to Maryland’s solar energy sales tax exemption, the state’s 6% sales tax cannot be added onto purchases of solar energy equipment. Sales tax can sometimes accumulate to over $1,000, so the energy savings are more than you think!
When a solar panel system is installed on a home, the value of the property goes up - and so do the property taxes. Maryland law exempts 100% of the assessed cost of a solar system from property taxes, so you won’t have to pay more when you install a system.
Certain Maryland counties offer solar tax credits when you install a solar system on your home. In Anne Arundel County for example, you can apply for a tax credit that is equal to 50% of the costs of solar system materials and installation up to $2,500. This tax credit is then applied to your property taxes.
With the state’s property tax exemption, this means that not only will installing a solar system not raise your property taxes, it can also actually decrease them!
(After tax credit)
(After tax credit)
You will save most money by buying your solar system rather than leasing it. Read more about the pros and cons of leasing vs buying solar.
Minimum of 25 years but generally 30 or more
Solar panels power your house when they can but your home uses the utility company for power at other times. In 2021 "solar systems with battery storage" are becoming more popular. These are known as hybrid systems.
A grid-tied system is the most common type of solar system. It has no solar battery for backup power and utilizes net metering to maximize savings. Solar panels are mounted on your roof then wired together, and the power generated flows into an inverter where direct current (DC) electricity is converted into alternating current (AC) electricity. This electricity is either used by your home or is exported to the utility grid.
In hybrid solar systems, rooftop solar panels are connected to both a solar battery and the electric grid. The solar electricity generated by your panels that your home does not use is stored in the battery instead of being sent to the grid, which reduces your reliance on the utility while also providing backup power when needed. Battery storage is still expensive but you may be able to reduce costs by using state incentives.
Off-grid solar systems are not connected to the grid at all, so all of your energy needs must be met by the sun. There is no utility to fall back on. The solar installation needs to power your home not only during the day, but after dark as well, so many solar panels and a large battery system are required. These systems are often expensive and don’t make sense for homes that have access to the grid.
Read more about types of home solar systems.
No, but cleaning them can improve power generation if they are dirty.
Given this environment, and the effect of import tariffs placed on solar panels by the Trump administration during 2018, it is hard to see that solar power system prices in Maryland will fall during 2021.
Depending on the location, solar panels will generate different amounts of electricity.
A solar system that is installed on a south-facing 29-degree pitch roof Maryland will generate 1,150kWh of peak DC (direct current) capacity per year per 1kW in Maryland.
Enter your details into the solar panel calculator to see how your location, roof tilt, and roof direction impacts solar panel production.
The advantages of installing solar panels in Maryland are that there are state and local-based incentives that can be used with the federal tax credit. Maryland’s high electric rates combined with their net metering requirement makes the overall return on investment for solar panels one of the best in the nation. The state also recently approved the expansion of their RPS, thereby increasing the amount of energy utilities must provide from solar power.
The disadvantage of installing solar panels for your home in Maryland is that there is less overall solar irradiation per year, meaning a solar system in Maryland will produce less than a solar system in sunnier states.
Despite this, there is no better time to make the switch to solar while local incentives and the 26% federal tax credit are still available.
This solar calculator requires you to input your address, utility company, your average monthly power spend - it tells you:
If you want to see all of the above but also see live pricing, the three best solar deals available in your city and get binding quotes from each of these solar companies then use this Maryland solar panels calculator. This calculator requires you to also input your name and contact details because most of our 200+ installer partners will only authorize the sharing of their live solar pricing where we have validated that you are a real homeowner with a home in their service area. We respect the privacy of your data and only share your contact details with the solar companies you ask us to get binding quotes from.
Note: Please keep in mind that the best source of up-to-date information on incentives are the solar installers who specialize in your area.
SunPower solar panels have an incredibly high price to match their superior specs. But are they worth it - especially if you're financing your system?
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