Maryland Solar Guide 2025: SRECs, Property Tax & Costs

I spent three weeks talking to solar installers, utility representatives, and homeowners across Maryland, and here's what became clear: Maryland is quietly one of the best states in the country for residential solar. It doesn't get the attention that California or Arizona receives, but the combination of high electricity rates, valuable SRECs, excellent net metering, and strong federal incentives creates economics that often outperform the sunbelt states.

The key is understanding how all these pieces fit together. Maryland's solar market has nuances that can make or break your investment. Get them right, and you're looking at 7-9 year payback periods. Get them wrong, and you might leave thousands of dollars on the table.

This guide covers everything Maryland homeowners need to know: actual costs from recent installations, every available incentive, how SRECs work, what to expect from BGE and Pepco, and real stories from homeowners who've made the switch. Let's dive in.

Why Maryland Is Exceptional for Solar

Before we get into the numbers, let me explain why Maryland works so well for solar—because it's not immediately obvious.

Maryland sits at about 39 degrees latitude. That's not exactly the desert Southwest. Yet the state averages 4.2-4.6 peak sun hours daily, which is perfectly adequate for strong solar production. What really makes Maryland special is the incentive stack:

• High electricity rates: Maryland residents pay $0.14-$0.17/kWh, well above the national average of $0.16/kWh. Higher rates mean bigger savings.
• Valuable SRECs: Maryland's Renewable Portfolio Standard creates ongoing income from your system—typically $500-$800 per year.
• Full retail net metering: Excess electricity earns full retail rate credits, not reduced wholesale rates.
• Property tax exemption: Solar doesn't increase your property taxes, protecting your investment.
• Federal tax credit: The 30% ITC applies through December 31, 2025, saving $7,000-$10,000 on typical systems.

When you stack all of these together, Maryland solar economics rival or exceed states with twice the sunshine.

Solar Costs in Maryland: What You'll Actually Pay

Maryland solar installation costs run slightly above the national average due to higher labor costs in the DC metro area and older housing stock that sometimes requires electrical upgrades. Here's what recent installations are costing:

System Size	Before Incentives	After Federal Credit	After SRECs (Year 1)
6 kW	$16,800-$19,200	$11,760-$13,440	$11,160-$12,840
8 kW	$22,400-$25,600	$15,680-$17,920	$14,880-$17,120
10 kW	$28,000-$32,000	$19,600-$22,400	$18,600-$21,400
12 kW	$33,600-$38,400	$23,520-$26,880	$22,320-$25,680

Average installed cost in Maryland runs $2.80-$3.20 per watt. The DC suburbs (Montgomery County, Prince George's County) tend to run at the higher end. Eastern Shore and Western Maryland often see lower prices due to reduced labor costs and simpler permitting.

What Affects Your Specific Price

Beyond system size, several factors influence your final cost:

• Roof complexity: Multi-story homes, steep pitches, and multiple roof faces add installation time and cost.
• Electrical panel: Older Maryland homes often have 100-amp panels that need upgrading to 200-amp for solar. Add $1,500-$3,000 if needed.
• Panel efficiency: Premium panels (REC, LG, Panasonic) cost 15-25% more than mid-tier options but produce more power in limited space.
• Battery storage: Adding a Tesla Powerwall or Enphase battery for backup costs $8,000-$15,000 additional, but qualifies for the 30% tax credit.

Maryland Solar Incentives: The Complete Breakdown

Federal Investment Tax Credit: 30%

The federal solar tax credit allows you to deduct 30% of your total solar installation cost from your federal income taxes. This is a credit, not a deduction—it directly reduces your tax bill dollar-for-dollar.

On a $24,000 Maryland installation, that's $7,200 back. On a larger system with battery storage totaling $38,000, you're looking at $11,400 in federal tax savings.

Critical deadline: The 30% ITC expires for residential solar installations on December 31, 2025. Your system must be fully installed and operational by that date—not just contracted, but actually producing electricity. After 2025, the residential credit drops to 0%. There is no extension currently planned.

What this means practically: Maryland installations typically take 6-10 weeks from contract to completion. If you want to claim the 30% credit, you need to sign a contract by October 2025 at the absolute latest, and earlier is safer.

Maryland SRECs: Ongoing Income From Your Solar System

This is where Maryland gets interesting. Under the state's Renewable Portfolio Standard (RPS), electricity suppliers must source a percentage of their power from solar. They prove compliance by purchasing Solar Renewable Energy Certificates (SRECs) from solar system owners like you.

Here's how SRECs work:

• Your system generates one SREC for every 1,000 kWh of electricity produced
• An 8 kW system produces roughly 9-10 SRECs per year
• Current Maryland SREC prices range from $50-$80 per certificate
• That's $450-$800 in annual SREC income, year after year

SREC income is separate from your electricity savings—it's additional revenue on top of the bill reduction. Over a 25-year system lifespan, SRECs could add $12,000-$20,000 in total value.

How to sell SRECs: Most homeowners work with SREC aggregators like SRECTrade or Flett Exchange, who handle the paperwork and find buyers. Some installers also offer SREC purchasing agreements upfront. Compare options—aggregators typically pay market rates while installer agreements may lock in lower fixed prices.

Property Tax Exemption: 100%

Maryland law (Tax-Property Article 8-240) completely exempts solar and wind energy equipment from property tax assessment. This is significant.

A $25,000 solar installation adds value to your home—studies suggest 3-4% of home value—but you won't pay higher property taxes on that increased value. At Maryland's average property tax rate of 1.1%, you're avoiding roughly $275-$330 per year in additional taxes.

Over 25 years, the property tax exemption saves $7,000-$8,000 that you'd otherwise pay in many other states.

Sales Tax Exemption

Solar equipment is exempt from Maryland's 6% sales tax. On a $24,000 system, that's $1,440 in automatic savings already factored into your quote.

Net Metering: Full Retail Rate Credits

Maryland requires all electric utilities to offer net metering for systems up to 2 MW at full retail rate. This is excellent compared to states like California (NEM 3.0) or Arizona that credit exports at reduced rates.

How it works in practice:

• Sunny afternoon: Your panels produce 4 kW, you're using 1 kW. The extra 3 kW flows to the grid, and your meter runs backward.
• Evening: Your panels produce 0 kW, you're using 3 kW. You draw from the grid, using up your credits.
• Monthly bill: You pay for net consumption only. If you produced more than you used, credits roll over.
• Annual true-up: Excess credits at year-end are typically paid out at a lower avoided cost rate.

The key is sizing your system to match annual consumption, not overproduce. A well-designed Maryland solar system aims for 95-105% of your annual electricity usage.

Maryland Utilities: BGE, Pepco, and Others

Baltimore Gas & Electric (BGE)

BGE serves most of central Maryland including Baltimore City, Baltimore County, Anne Arundel, Howard, Carroll, and Harford counties. They're the largest Maryland utility and have streamlined their solar interconnection process.

• Net metering: Full retail rate for systems up to 2 MW
• Interconnection: 10-15 business days after installation approval
• Time-of-use rates: Optional TOU plans available that can benefit solar owners

BGE territory offers competitive solar markets with numerous installer options.

Potomac Electric (Pepco)

Pepco serves Montgomery and Prince George's counties—the DC suburbs. These areas have high electricity consumption (big homes, hot summers) and excellent solar economics.

• Net metering: Full retail rate, credits roll monthly
• Higher rates: Pepco rates run $0.14-$0.18/kWh, making solar savings more significant
• Permitting: Montgomery and PG counties have relatively efficient solar permitting

SMECO, Delmarva, and Other Utilities

Smaller utilities serving parts of Maryland also offer net metering, though policies can vary slightly. Check with your specific utility before signing a contract.

Real Maryland Homeowner Stories

Tom and Rebecca, Columbia (BGE Territory)

"We'd been thinking about solar for years but kept putting it off. Then we heard about the tax credit deadline and realized we couldn't keep waiting. Our installer—a local company out of Laurel—quoted us $26,400 for a 9 kW system. After the 30% federal credit, we paid $18,480 out of pocket."

"Our BGE bill used to run $180-$220 per month. Now it's basically $12 for the connection fee. We're also selling SRECs through SRECTrade and getting around $55 per certificate—that's about $500 a year extra."

"Total annual savings are around $2,100 between the lower bill and SREC income. At that rate, we'll pay off the system in about 8.8 years. And after that? Twenty years of essentially free electricity."

Marcus, Silver Spring (Pepco Territory)

"I work from home and my electricity consumption was brutal—$280 monthly average, higher in summer with the AC running. Pepco rates are not cheap. I installed 10 kW in March 2024, cost $29,500 before the tax credit. Net cost was $20,650."

"First full year, the system generated 12,300 kWh, which was slightly above the estimate. My electric bill dropped to basically zero—I'm actually net positive about 2,000 kWh. The SRECs are earning about $720 per year at current prices."

"My payback calculation: $2,400 annual bill savings plus $720 SREC income equals $3,120 per year. At that rate, I recover my investment in 6.6 years. Given that the panels are warranted for 25 years, that's nearly 20 years of pure profit."

Linda, Annapolis (BGE Territory)

"I'm retired and on a fixed income, so I was nervous about the upfront cost. But I had $5,800 in federal taxes last year, which meant I could use most of the tax credit. I installed 6 kW for $18,200 before credits—$12,740 net."

"My BGE bill went from $140/month to about $18. SRECs add another $350 or so per year. I'm saving around $1,800 annually, which means payback in about 7 years. For me, it was also about independence—I like knowing my electricity is coming from my own roof."

Detailed Cost-Benefit Analysis

Let's run the complete numbers for a typical Maryland installation:

Scenario: 8 kW System in Baltimore County

Item	Amount
System cost (installed)	$24,000
Federal tax credit (30%)	-$7,200
Net cost after tax credit	$16,800
Annual electricity production	9,600 kWh
BGE rate	$0.15/kWh
Annual electricity savings	$1,440
Annual SREC income (9 SRECs @ $65)	$585
Total annual value	$2,025
Simple payback period	8.3 years
System lifespan	25+ years
Post-payback savings (years 9-25)	$34,425

Over 25 years, this system generates $50,625 in total value ($2,025 x 25), from a net investment of $16,800. That's a 201% return on investment, or about 8% annualized return. Better than most stock market investments, and far more predictable.

Common Questions From Maryland Homeowners

Q: Will SRECs keep their value?

A: SREC prices fluctuate based on supply and demand within the RPS market. Maryland's solar carve-out runs through 2030, providing policy certainty through that date. Historical SREC prices have ranged from $40-$200 over the years. Most analysts expect prices to remain in the $40-$80 range through 2030. After that, it depends on whether Maryland extends the RPS. Don't count on SRECs for your entire payback calculation—think of them as bonus income.

Q: Do I need battery storage?

A: For most Maryland homeowners, battery storage is optional, not essential. The grid is reliable, and net metering means you can effectively use the grid as your battery. However, batteries make sense if: (1) you want backup power during outages, (2) you're in an area with frequent power interruptions, or (3) you have medical equipment that requires continuous power. The 30% federal tax credit applies to battery storage too, making 2025 a good year to add one if you're interested.

Q: How long does installation take?

A: Typical Maryland timeline runs 6-10 weeks from contract signing to system activation. The breakdown: 1-2 weeks for design and permitting, 1-2 days for actual installation, 2-4 weeks for inspections and utility approval. Montgomery County and Baltimore City can be slower on permits. Plan accordingly if you're targeting the December 31, 2025 deadline.

Q: What about my HOA?

A: Maryland law (Real Property Article 2-119) protects solar rights. HOAs cannot prohibit solar installations. They can establish reasonable aesthetic guidelines (like placement and equipment color) but cannot prevent you from going solar entirely. If your HOA gives you trouble, cite the Maryland Solar Access Act.

Q: Should I buy or lease?

A: Buying is almost always better in Maryland. When you own the system, you get the federal tax credit, you get the SREC income, and you get the full electricity savings. Leasing typically transfers those benefits to the leasing company. The only advantage of leasing is $0 upfront cost, but if you can afford to buy (or finance), the long-term returns are significantly better.

The Bottom Line for Maryland Homeowners

Maryland solar economics are excellent. High electricity rates, valuable SRECs, strong net metering, and generous tax incentives combine to create 7-10 year payback periods—followed by 15-20 years of essentially free electricity.

But there's urgency now. The 30% federal tax credit expires December 31, 2025. On a typical Maryland installation, that's $7,000-$10,000 in savings that simply won't exist in 2026.

If you've been considering solar, this is the year to act. Get quotes from at least three reputable installers. Run the numbers for your specific situation. And if the math works—and for most Maryland homeowners it does—don't wait until it's too late.

Maryland may not have Arizona's sunshine, but it has something better: an incentive structure that makes solar a genuinely smart financial decision. Take advantage while you still can.