Maryland’s solar energy industry has been taking off in recent years. The state has more than quadrupled its total installed solar capacity since 2015, and comes 17th in the National Solar Ranking out of all US states. With its current solar capacity sitting at 1,288.70 MW, Maryland generates enough solar energy to supply 4.23% of its overall power consumption, equivalent to powering 147,244 homes. All of this solar power is generated by a handful of large-scale solar utility farms, along with more than 73,000 certified residential solar installations.
The cost of solar energy systems in Maryland has declined by 45% in the last 5 years, making it easier and cheaper than ever for residential customers to install solar for their homes. These declining costs also mean that the state government has put forward plans to greatly expand solar capacity: Maryland plans to increase its total installed solar capacity by more than 1,300 MW in the next five years, and the state’s Renewable Portfolio Standards mandate that all electricity produced in the state by 2040 has to come from 100% renewable sources, including solar.
What you should know about Solar Energy in Maryland
Residential power in Maryland is provided by four major utility companies: Baltimore Gas and Electric (BGE), Potomac Electric Power Company (PEPCO), Delmarva Power, and the Potomac Edison Company. There are also two electric cooperatives, the Southern Maryland Electric Cooperative, Inc. (SMECO) and Choptank Electric Cooperative, as well as several other smaller municipal utilities specific to smaller towns and regions.
Most of the companies which distribute electricity in Maryland are required by the Maryland Public Services Commission (PSC) to set utility rates and rules according to PSC mandates. This means that most of these power providers offer similar rates for electricity. Many of these companies have set geographic regions where they operate, but in some regions it is possible for Maryland residents to choose which utility provider to use. While some providers offer fixed rates for electricity, others vary their rates on a monthly basis. It’s important to do your research and pick the best provider possible for your needs!
On average, Maryland residents pay electricity bills 20.56% higher than the national average. The state has a mean electricity cost of 12.84 ¢ per kilowatt-hour consumed, which is again 8% higher than the national average. This makes Maryland the US state with the 15th most expensive electricity.
Little wonder then, that solar energy is quickly being adopted throughout the state. Not only can going solar help you cut down significantly on your high utility bills, solar is also a renewable energy source which can reduce your greenhouse gas emissions. Depending on the scale of your system, installing residential rooftop solar in Maryland can offset most of or even your entire monthly utility bill!
Is it worth going solar in Maryland?
Due to high electricity costs and above-average energy consumption rates, the average monthly electric bill is high in Maryland, which in turn makes going solar extremely beneficial for state residents. Maryland is also a state with great solar potential, and comes 17th out of all US states in the Solar Power Potential Ranking according to the NDEE-Energy & Assistance Division.
Specifically, with an average electricity cost of 12.84 ¢/kWh, Maryland’s power rates are 32% higher than that of states like Washington, Idaho, Arkansas, or Louisiana. The average monthly electricity bill in Maryland is around $127.92, which is also 26% higher than average monthly bills in California, 35% than in Washington, and a whopping 69% higher than in Utah.
These higher bills are also partly due to high rates of energy use. The average Maryland home consumes up to 1,005 kilowatts-hour a month and 12,060 kilowatt-hours per year, and the state comes 20th in the United States when it comes to average household power consumption. To put this in perspective, these consumption rates are 11.3% higher than the national average of 903 kWh/month.
An average-sized 5 kW DC solar system can generate up to 7,000 kWh of electricity each year in Maryland, supplying enough solar energy to cover 58% of your average power needs. According to the National Renewable Energy Laboratory (NREL) database, a slightly larger 8.7 – 9 kW DC capacity rooftop solar system is the perfect size for maximizing solar savings in Maryland
Installing a rooftop solar energy system of this scale can cost between $22,079 to $23,913, before any incentives are factored in. After applying the federal ITC incentive available to all US residents, the cost can be reduced to just $16,339 – $17,696! What’re more, the final cost you end up paying can be reduced even further after applying local state or regional incentives for residential photovoltaic (PV) systems in Maryland. By taking advantage of these many incentives, the payback period for your residential solar energy system can be as fast as 6.1 to 7.5 years, after which you will start turning a profit from your solar installation.
Considering the average lifespan of a solar inverter, the core of a solar energy system, an average solar PV system can last around 25 years. For the PV systems described above with 8-9 kW of capacity, 25 years of continuous operation can save you an average of $38,000 in utility bills. That’s almost three times the initial cost of installing your PV system, after applying all relevant incentives!
Even if you’re still on the fence about solar, it doesn’t hurt to entertain a few free offers from solar companies in your neighborhood. The clock is ticking, though. The generous federal ITC incentive gives you a tax credit worth 26% of your solar installation costs, but the tax incentive rewards from this scheme will be reduced to 22% by 2023 and completely disappear by 2024 onwards. This means that, for Maryland residents, installing your PV system by 2021 or 2022 will allow you to get the most out of US solar incentives.
How much energy will your solar system generate?
The amount of solar your system will generate depends on the characteristics of your property, such as the orientation of your rooftop and the amount of shading that your house gets. However, another important factor is the total amount of solar radiation that you receive. According to NREL, Maryland receives between 3.05 – 6.4 kilowatt-hours of solar radiation per square meter a day depending on the month and your exact geographical location within the state. That’s a sizeable amount of radiation, allowing Maryland to come 17th out of 50 states on the US Solar Power Potential Ranking.
These levels of solar radiation experienced in Maryland translate into 3 to 4.6 full hours of solar generation at maximum efficiency for your rooftop PV system. A 8.7 kW DC solar system in Maryland can generate up to 12,594 kWh in AC electricity each year, going by these calculations.
On average, Maryland homes consume around 12,060 kWh per year. This means that a medium-sized 8-9 kW DC solar residential system can provide just enough electricity to meet the power needs of your home for the whole year. A rooftop PV system of this size can thus save you up to $1,617.06 a month in lower electrical utility bills!
Maryland state laws also allow residents to install much larger residential solar PV systems compared to other states. Residents in the state can install solar systems with enough capacity to generate as much as 200% of their current annual electricity consumption. Paired with the state’s Net Metering program, you can sell back any excess power to your utility and receive an electricity credit which rolls over until the end of your 12-month billing cycle. When this billing cycle ends each April, your utility would compensate you for any remaining electricity credits at the average commodity electricity rate for that year, which is typically slightly lower than the retail rate that you pay for electricity.
Payment options for your PV system in Maryland
Several different payment options for a PV system are available in Maryland, but not all of them make you eligible for state and federal solar incentives. Here’s a quick run-down of the four main payment types, and their pros and cons:
We recommend paying for your system in full with cash, if you have the means to do so. This is the simplest and most straightforward payment method, and also ensures that you won’t have to pay interest on any loans. This option also allows you to obtain full ownership of your solar system, making sure that you are eligible for federal and local incentives.
That being said, paying for your PV system by taking out a solar loan can also be a great option. Many financial institutions in Maryland offer solar loans specifically for PV systems, and some of these loans may have better terms and lower interest rates compared to ordinary bank loans. Your solar company is also likely able to help you find a loan partner. Compare and contrast a few different loan options available to find one with the best rates! Using these loans to pay for solar should still allow you to remain eligible for solar incentives.
A Solar Lease allows you to use solar power for your home, but be aware that these leases do not actually grant you ownership of a solar PV system, thus disqualifying you from most solar incentives. A solar lease is a contract which you can sign with the owner of a solar PV system to “buy” the total electricity output of his system at a fixed rate for a set period of time.
Solar Power Purchase Agreement (Solar PPA)
A Solar Power Purchase Agreement or Solar PPA, is offered by some solar installers. Under these agreements, a solar installer would install a PV system on your property, but retain ownership of the system. Instead, you would agree to purchase the electricity generated by this system, and only pay for how much you use. This option allows you to consume clean energy with less greenhouse gas emissions usually at a lower cost per kWh rate compared to regular electricity rates, without needing to pay upfront for a rooftop solar system. Again, however, you would not be eligible for any solar incentives since you do not actually own the system.
What are the solar incentives in Maryland?
Maryland residents are eligible for both federal solar incentives and a handful of state-specific ones. Here’s how some of these incentives work, and how much each scheme can help save you when installing solar.
Federal Solar Investment Tax Credit (ITC)
The Federal Solar Investment Tax Credit is a federal incentive aimed at improving solar adoption rates across the United States. The program provides a generous tax credit worth 26% of your total solar installation costs, which can be used to offset the amount of federal income tax you pay. This credit can also be rolled over to the following year, if it exceeds the amount of tax you owe that year.
The ITC credit will remain at 26% until the end of 2022. In 2023, the incentive reduction will be lowered to only 22%, and disappear altogether for residential solar installations after that year. We highly recommend installing your solar energy system in 2021 or 2022, in order to make the most out of this scheme!
Solar Energy System Property Tax Exemption
Going solar can increase the valuation of your home, which might not be a great thing when it comes to the amount of property tax that you need to pay. Under Maryland’s Solar Energy System Property Tax Exemption however, there’s no need to worry about your taxes going up: this law exempts homeowners in the state from paying any extra property tax due to installing a home solar or wind power system.
Solar Panel System Sales Tax Exemption
Maryland residents are usually subject to a 6% sales tax on purchases. The Solar Panel System Sales Tax Exemption in Maryland removes this tax exclusively for solar products, however. This can result in a close to 6% discount on solar installation costs in the state.
When added to the 26% tax credit ITC above, Maryland residents can cut down on the cost of installing residential solar systems by almost one-third! Keep in mind, however, that the PV system must be installed on a residential property that is eligible for net metering in order to qualify for this sales tax exemption.
Solar Renewable Energy Credits (SRECs)
The Maryland Solar Renewable Energy Credits (SRECs) is a state program to encourage home PV systems, and at the same time helps the state achieve its ambitious renewable energy goals. The program allows for rooftop solar system owners to earn one SREC credit for each megawatt-hour of electricity generated by their PV system. This credit can be sold on the state’s SREC trade market to businesses or utilities looking to comply with clean energy requirement laws. In April of 2021, the SREC bid price was set at $77.50 for one credit.
Residential Clean Energy Rebate Program (R-CERP)
The Residential Clean Energy Rebate Program (R-CERP) can further reduce the payback period of residential solar energy systems in Maryland, and is applicable to PV systems with 1 – 20 kW DC capacity. The R-CERP allows state residents acquiring new rooftop solar systems to apply for a $1000 solar rebate. Other renewable energy installations, like Geothermal or Solar Water Heating systems, are also eligible for this R-CERP rebate.
Maryland Net Metering program
The Maryland Net Metering Program works slightly differently compared to the programs adopted in other states, especially when it comes to how excess credits are handled at the end of the billing cycle. Under this scheme, homeowners can sell all of their unused solar power back to the grid, receiving electricity credits in return. These credits offset the amount of electricity you use one-to-one, and can be carried over until the end of the billing cycle in April.
Any excess credits remaining will then be compensated to the customer in cash when the billing cycle ends, but not at the full retail rate. Instead, an average commodity electricity rate is used. This rate is set at a different level each year, and is typically lower than the retail rate.
Best Solar Companies in Maryland: Our top choices
Its important to consider all of the benefits and discounts offered by a solar company when going solar. More important that that, however, is to pick out a good installer with experience installing high-quality systems using products from top solar manufacturers. To assist you in picking out your future solar partner, we’ve compiled a list of the best solar companies in Maryland below. Here are some of the main criteria we looked into when making our shortlist:
- Company reputation – Does the installer have a history of great customer reviews online?
- Solar installation experience and quality – how many projects has the company undertaken, and how satisfied are their customers?
- Which solar products and brands does the company use? The best panels will make and save you the most money, after all!
- What are the manufacturer partnerships, solar certifications and state licenses held by the company?
- What are the warranty terms offered by the company?
Lumina solar is a Maryland-based solar company, fielding veteran solar installation teams with more than 10 years of experience. The company provides custom PV systems designed to be perfectly suited for each customer’s needs..
Lumina Solar is a multi-state solar company with offices in Pennsylvania and Virginia, in addition to their Maryland headquarters in Baltimore. They serve customers across all three of these states.
Certificates and Licensing
Lumina Solar is licensed as a Home Improvement Contractor in Maryland. The company also employs NABCEP-certified PV Installation Professionals.
Lumina Solar is a solar installer focused on cutting costs and maximizing electricity savings for their customers. In addition to installing rooftop PV systems, the company is also able to help set up battery connected solar energy systems, and also offers repair and maintenance services for existing systems.
While the company was only founded in 2018, Lumina Solar’s veteran management team boasts a collective 45 years of experience in the solar industry, meaning that you’ll be leaving entrusting your solar installation to experienced hands when going with the company.
Lumina Solar has an incredible online reputation, boasting a perfect 5-star rating on Google for their Maryland headquarters, even after more than 230 customer reviews. They are also the highest-rated solar company in Maryland on Solar Reviews, where they hold a 4.94-rating from 170 reviews.
The company also enjoys a 4.8-rating on Facebook based on 33 customer opinions. Many customers praised Lumina Solar for making the installation feel easy and seamless.
Founded in 2012, Nova Solar provides roofing, tree removal and electrical contracting services, as well as high-quality solar installations for customers in the US Northeast.
Nova Solar is headquartered in Virginia, with office locations in both Northern and Southern Virginia. They mainly serve customers located in Virginia, Maryland or Washington DC.
Nova Solar holds the required Home Improvement Contractor license necessary for carrying out solar work in Maryland. They also employ NABCEP-certified PV Associates and PV Installation Professionals.
Nova Solar believes in building systems to last. The company has a policy of assigning a NABCEP-certified solar professional to each project they undertake, in order to ensure that each installation they carry out is of high quality.
Nova Solar also makes a point of using only top products from leading solar manufacturers, allowing customers to pick products from brands such as Enphase Energy, IronRidge, LG Solar, SolarEdge Technologies, REC, OutBack Power, Silfab Solar, and Q CELLS. The company has partnered with financial institutions such as Dividend Solar and Sungage Financial to offer solar loans to their customers, making it easy for customers to find a suitable solar payment plan.
Nova Solar has a great reputation on Google, with its company headquarters in Virginia maintaining a flawless 5-star rating after 51 reviews. They’re also well-regarded on Solar Reviews, where the company has an impressive 4.81-star rating after 50 reviews.
The company is accredited with an A+ on the BBB as well, and holds a perfect 5-star rating on the platform based on 11 customer reviews. Many customers praised Nova Solar for offering high-quality work at competitive prices, and for being accommodating towards customer requests on specific requirements.
Green Brilliance LLC
Founded in 2007, Green Brilliance offers a wide variety of services, including commercial and residential PV installation, home energy auditing, roofing, electrical contracting as well as related repair and maintenance.
Green Brilliance has their corporate headquarters in Virginia. They primarily serve customers in Virginia and the nearby regions of Maryland, Pennsylvania and Washington DC.
Licensing and Certification
Green Brilliance holds a Home Improvement Contractor license for Maryland. They also employ NABCEP-certified PV Installation professionals.
Green Brilliance has over a decade of experience operating in the solar industry, and with this expertise comes a dedication to providing the highest-quality PV installations to its customers. The company strictly inspects each system they install according to their own Solar32 Certified checklist, which is a 32-point comprehensive quality control checklist developed by Green Brilliance themselves. Each of their installed systems also use exclusively 100% US-made solar products, and comes with a 25-year warranty.
The installer has been recognized as the 19th largest solar installer in the country by Solar Power World magazine, and has previously been named the Most Forward-Looking Solar Contractor in the US.
Green Brilliance is well-reviewed online, and the company holds a 4.6-star rating on Google for its Virginia headquarters with 100 customer reviews. They also have a good 4 out of 5 rating on Energy Sage, based on 62 customer reviews.
Green Brilliance is also accredited with an A+ on the BBB, and has a high 4.8-star customer rating on the platform after 45 reviews. There have been 8 complaints made against them on the BBB, though each has been addressed in detail and 4 resolved. While many of these complaints revolved around issues with replacing faulty parts of installed solar systems, Green Brilliance has made good efforts to reach out to each customer and offer support when appropriate.
Ipsun Solar is a full-service solar EPC contractor, capable of installing both residential and commercial solar PV systems. The company is also a certified B Corp, committed to sustainable business practices and green purchases.
Ipsun Solar is headquartered in Virginia, and the company has a secondary location in Washington DC. Their service area covers the regions of Northern Virginia, Washington DC and Southern Maryland.
Licensing and Certifications
Ipsun Solar has a Home Improvement Contractor license for the state of Maryland. Ipsun Solar also employs NABCEP-certified PV Installation professionals.
Ipsun Solar was founded in 2016 by solar energy engineer Herve Billet, who has worked on renewable energy projects for MIT and the US Department of Energy in the past before co-founding his own solar installation company. In 2019 alone the company installed more than 2,000,000 watts of solar energy for customers, and the company today is involved in over 1,300 different solar projects.
The company offers a wide range of top solar products to customers in its commercial and residential solar installations, including products from leading brands such as Enphase Energy, SolarWorld, Unirac, Inc., SolarEdge Technologies, Suniva, Inc., Siemens (EV), and Aerocompact.
Ipsun Solar has received a perfect 5-star rating for both its Virginia headquarters and Washington DC location on Google, where the company has accumulated a total of 115 reviews across the two locations. They also enjoy a good 4.56-rating on Solar Reviews, though they have only received 20 total reviews on the site.
Ipsun Solar is accredited with an A+ on the BBB, but the company has received 3 complaints on the site, with 2 resolved. Ipsun Solar has made genuine efforts to address each customer complaint and make appropriate compensation.
American Sentry Solar
Originally created as an offshoot of home renovation company American Design and Build in 2009, American Sentry Solar is today one of the most well-known names in Maryland’s solar industry. They’ve installed solar for thousands of satisfied homeowners in the state, and uses their rich roofing renovation experience to install high-quality solar rooftop systems.
American Sentry Solar has their corporate headquarters in Maryland, and has an additional office location in Texas. Their service area covers the 3 states of Maryland, Texas and Delaware.
Licensing and Certification
American Sentry Solar is licensed as a Home Improvement Contractor in Maryland, and also employs NABCEP-certified PV Installation Professionals.
American Sentry Solar was originally founded in 2009 as a solar-specialized division of the decades-old renovation company American Design and Build. The solar installer has been recognized each year since 2014 as one of the Top 500 Solar Contractors in America by Solar Power World Magazine.
American Sentry Solar is committed to giving back to the community, and have their own Small Business Recognition Program where the company allows customers to nominate small local businesses to receive a $1,000 check from American Sentry, in order to help these businesses out during the covid lockdowns. The company also donates $500 from each solar sale to one of six charities dedicated to supporting American firefighters, medical workers, veterans and policemen.
American Sentry Solar has generally received good reviews from their customers online. They have a 4.4-star Google rating based on 102 reviews for their Maryland headquarters, as well as an impressive 4.82-rating on Solar Reviews from 158 reviews.
The company does have a lower rating on Facebook, however, where they hold a 3.7-star rating after 25 reviews. While many customers were happy with the company’s high quality and professional solar installations, a few negative reviews complained about American Sentry’s aggressive salesmen and constant calls, even after the customer informed American Sentry of not being interested in the company’s services.
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