Maryland Solar Incentive Programs

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Maryland, characterized by a temperate climate, experiences approximately 205 sunny days annually, providing a decent amount of sunlight for solar energy initiatives. Maryland’s solar incentive programs shown below reflect the state’s dedication to promoting renewable energy and reducing carbon emissions. With a range of financial incentives, Maryland homeowners and businesses are encouraged to invest in solar energy systems, contributing to a sustainable future while enjoying economic benefits.

Federal Incentives

Federal Investment Tax Credit (ITC)

Commercial solar energy systems installed in Maryland can take advantage of the Federal Investment Tax Credit 48E, which provides a tax credit of 30% of the total cost of the system, provided prevailing wage and apprenticeship requirements are met. 

Residential systems can no longer claim any federal solar tax credit, as the One Big Beautiful Bill eliminated it for systems installed after January 1st, 2026. 

Commercial Depreciation

Commercial asset owners can write off 100% of a project’s value in depreciation in the first year. The One Big Beautiful Bill reinstated the 100% bonus depreciation, while simultaneously eliminating the Modified Accelerated Cost Recovery System (MACRS) that previously depreciated solar energy systems over 5 years. 

The depreciable basis of a project is reduced by half of the ITC value when combined with the 30% ITC. Here’s a quick example:

• Project cost = $800,000
• 30% credit = $240,000
• Reduced depreciation basis: $800,000 – ($240,000 / 2) = $680,000

A company’s tax rate is then taken into account to calculate the exact amount they’re able to write off. .

Maryland Solar Renewable Energy Certificate (SREC) Program

After installing solar panels, Maryland homeowners can earn money back for the energy generated through the SREC marketplace. This program allows homeowners to sell SRECs generated by their solar systems, providing an ongoing revenue stream.

Residential Clean Energy Rebate Program

The Maryland Residential Clean Energy Rebate Program offers a rebate of up to $1,000 for the installation of solar panels. This program operates annually on a first-come, first-serve basis, incentivizing early adoption.

Sales and Property Tax Exemptions

• Sales Tax Exemption: Solar panel systems are exempt from the state sales tax in Maryland, allowing consumers to save on the upfront costs associated with purchasing solar panels.
• Property Tax Exemption: Homeowners do not have to pay higher property taxes based on the installation of solar panels, ensuring that the investment in solar energy remains affordable.

Local Solar Tax Credits

Maryland’s statewide push to go solar has motivated many counties to offer substantial tax credits for the installation of solar energy systems. These local incentives can provide additional savings, making solar energy even more accessible.

Maryland Energy Storage Income Tax Credit

The Maryland Energy Storage Income Tax Credit is available to residential and commercial taxpayers who have installed energy storage systems. This credit supports the integration of solar energy into the grid, enhancing the reliability and efficiency of renewable energy sources.

Maryland’s solar incentives are a testament to the state’s progressive approach to energy policy. With the combination of federal tax credits, SREC income, state rebates, and tax exemptions, Maryland residents have a strong financial case for adopting solar energy. As the state continues to prioritize clean energy, solar power is poised to play a significant role in Maryland’s energy future.

Further information and programs can be found at the Programs.Dsireusa.org