2023 Solar Incentives Guide for College Park, MD - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in College Park.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in College Park?
Residential Clean Energy Rebate Program
SWH: $500/project (flat per installation/household incentive)
New GHC: $3,000/project
GHC Replacement: $500/project
Solar Renewable Energy Certificates (SRECs)
Sales and Use Tax Exemption for Residential Solar and Wind Electricity Sales
Property Tax Exemption for Solar and Wind Energy Systems
Clean-Burning Wood Stove Grant Program
Pellet Burning Stove: $700
Wood Heating Fuel Exemption
Local Option - Property Tax Credit for High Performance Buildings
Local Option - Property Tax Credit for Renewables and Energy Conservation Devices
Residential/Community Wind Grant Program
Community: $1000/kW - $4000/kW, depending on the system capacity
PEPCO - Residential Energy Efficiency Rebate Program
LED Bulbs: Up to $3 per bulb
LED Fixtures: $8 per fixture
Clothes Dryer: $50
Clothes Washer: $75 - $100
Hybrid Water Heater: $500
Pool Pump: $150 - $400
Smart Thermostat: $100
Air-Source Heat Pump: $400 (Tier 1) - $650 (Tier 2)
Central A/C: $300 (Tier 1) - $500 (Tier 2)
Geothermal Heat Pump: $1,500
ECM Furnace Motor: $50 - $100
Home Energy Check up: Free
Refrigerator or Freezer: $50
Room A/C or Dehumidifier: $25
Federal Residential Renewable Energy Tax Credit
The term "solar incentives" includes a range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives may include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered federally, while others are offered by the Maryland government or by your specific utility company, county or municipality. Types of solar incentives might include:
- Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your College Park utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in other areas you may make back a percentage of the value.
- Tax Credits: Tax credits lower, dollar-for-dollar, the amount of income tax you owe the federal government. These are different from tax deductions.
- Tax Exemptions: Your solar system might qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to ignore the added value of the solar panels when you are calculating property taxes on your home.
- Solar Renewable Energy Certificate (SREC): In general, solar systems that produce over a specific (normally small) amount of electricity can qualify for SRECs or other performance-based incentives. SRECs and the like are typically given at the state level. You can sell SRECs to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
- Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar panels. Counties or states will also offer limited-time rebates at various times. Any rebates you receive will usually be deducted from the total price before tax credits are calculated.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some knowledge of. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit that reduces your taxes by a certain percentage of the money you spend installing solar panels.
The ITC applies to solar panels installed on your primary or secondary residence in the United States. The solar panels have to have been installed after January 1, 2006 on a property owned by you for you to claim the credit. The ITC originally paid out 30% of all system installation costs (panels, accessories, labor and equipment), although the covered amount has fluctuated slightly over time between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the claim amount.
Have questions about how the ITC applies to your specific situation? Reach out to your local College Park solar panel installer to get more information.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). With the new provisions, solar installation projects started after January 1, 2022 and completed by the end of 2032 can qualify for a 30% tax credit. This percentage will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. The expansion also makes it easier to get credit for energy storage systems, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. Your local College Park solar panel installer can answer your questions and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
Some solar incentives are often also provided by state and local governments. Like with federal incentives, these may include tax credits, rebates and more. Some incentives are ongoing, while others are offered for only a limited time. Your local incentives might come from the Maryland government, or from your specific county or municipality.
Next Steps for Installing Solar in College Park
The expanding number of available solar incentives has helped tremendously increase the use of solar power nationwide over the past 15 years. You can get solar incentives from your local utility company, the federal government or the Maryland government. Speak with your local solar panel installer today to learn more and to save as much money as possible on solar panels for your College Park home.
EcoWatch's College Park, MD Solar Incentives FAQs
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