2023 Solar Incentives Guide for Essex, MD - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Essex.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated September 15, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Essex?
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
Baltimore County - Property Tax Credit for Solar and Geothermal Devices
Local Option - Property Tax Credit for High Performance Buildings
Baltimore County - Property Tax Credit for High Performance Buildings and Homes
Homes (LEED or NGBS): 40% - 100% of county real property taxes assessed for 3 - 5 years
Homes (Energy Improvements): varies, equal to the % of energy efficiency improvement over a baseline of existing home or the energy code for new homes
Local Option - Property Tax Credit for Renewables and Energy Conservation Devices
Baltimore Gas & Electric Company (Electric) - Residential Energy Efficiency Rebate Program
Clothes Dryer (Electric): $50
Clothes Washer: $75 - $100
Hybrid Heat Pump Water Heater: $500
Pool Pump: $150 - $400
Refrigerator: $100
Dehumidifier: $30
Refrigerator or Freezer Recycling: $50, plus $25 bonus when recycling an old, working room A/C or dehumidifier at the same time
Room A/C or Dehumidifier Recycling (*May 20, 2017 only*): $25
Smart Thermostat: $100
Heating & Cooling
Air-Source Heat Pump: $400 - $650
Central A/C: $300 - $500
Gas Furnace: $250
Furnace Blower Motor: $50 - $100
Geothermal Heat Pump: $1,500
Lighting
Instant discounts vary by participating retailer; see program website
Baltimore Gas & Electric Company (Gas) - Residential Energy Efficiency Rebate Program
Clothes Dryer (Electric): $50
Clothes Washer: $75 - $100
Hybrid Heat Pump Water Heater: $500
Pool Pump: $150 - $400
Refrigerator: $100
Dehumidifier: $30
Refrigerator or Freezer Recycling: $50, plus $25 bonus when recycling an old, working room A/C or dehumidifier at the same time
Room A/C or Dehumidifier Recycling (*May 20, 2017 only*): $25
Smart Thermostat: $100
Heating & Cooling
Air-Source Heat Pump: $400 - $650
Central A/C: $300 - $500
Gas Furnace: $250
Furnace Blower Motor: $50 - $100
Geothermal Heat Pump: $1,500
Lighting
Instant discounts vary by participating retailer; see program website
Residential/Community Wind Grant Program
Community: $1000/kW - $4000/kW, depending on the system capacity
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives encourage people to switch their home over to renewable energy by offering incentives that lower the financial burden of solar panel installation and use. The incentives could include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are offered by the federal government, some by the Maryland government and some by your specific utility company, county or municipality. Some broad categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for cash that is generally considered part of your taxable income. In most cases, there is a small threshold of energy production to meet before your solar system qualifies for SRECs or other performance-based incentives. These kinds of incentives are generally handled by your state government.
- Rebates: Rebates, or partial refunds after a purchase, are typically given prior to any solar tax credits being calculated. Rebates can be given by your local utility company, by your state or by your county.
- Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
- Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar system. Property tax exemptions let you exclude the added value of your solar system when you're calculating the amount of property tax you need to pay on your home.
- Net Metering: You can sign a net metering contract with your Essex utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then deduct this value from your utility bill each month.
Best Social Impact
Palmetto Solar
- Expansive service area
- Makes charitable contributions
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- No leases or PPAs
- Quality of installation may vary by location
Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when you think about solar incentives. A federal incentive that most people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a certain percentage of your solar system's cost.
The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar panels must have been installed on a property you own after January 1, 2006 for you to be eligible for the credit. Originally, the ITC covered 30% of all system costs (panels, accessories, equipment and labor), although this amount has fluctuated slightly over time between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the claim amount.
Curious how the ITC might apply to your specific situation? Reach out to your local Essex solar panel installation expert to get more information.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. With the new provisions, solar installation projects started after January 1, 2022 and completed by the end of 2032 might 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. Starting in 2023, the program expansion will also make credits for energy storage systems even easier to claim.
More information about the new Inflation Reduction Act can be found here. The best way to understand how the new Clean Energy Credit might apply to you is to talk with your local Essex solar panel installers.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. As with federal incentives, these might include tax credits, rebates and more. Certain incentives are ongoing, while others are offered for only a limited time. These local incentives could come from your county or municipality, or from the Maryland government.
Next Steps for Installing Solar in Essex
There are many kinds of solar incentives: those offered by local utility companies, those offered by the federal government and those offered by the Maryland government, to name a few. The use of solar energy has grown tremendously in the last 15 years, partially thanks to these incentives. Your local Essex solar panel installer can give you more information about which incentives you can apply for, and get you feeling good about making the change to renewable energy today.
EcoWatch's Essex, MD Solar Incentives FAQs
If I already have solar panels, can I still claim incentives?
If your solar panels were installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If you had your system installed between 2006 and 2021, you may qualify for a tax credit between 26% and 30%, depending on the year it was installed. Speaking with the company that installed your system, or any local Essex solar installer, can help you understand what incentives you might want to apply for.
How much will a solar system save me on my electric bill in Essex annually?
On average, homeowners in Essex who install solar panels save about $747.69 per year, or about $14,206.16 over 20 years after they make the switch.
What are some of the environmental benefits of switching to solar energy?
You can reduce your carbon footprint by 300 pounds of CO2 annually by switching to solar panels. This adds up to around 6,000 pounds in 20 years. In addition, solar power is a renewable energy source, meaning that switching your home over reduces the drain on our planet's resources.
How long until the federal solar tax credit ends?
The Clean Energy Credit (formerly called the federal solar tax credit, or the ITC), is slated to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I receive incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can receive both tax credits and rebates towards the cost of your solar panels. Depending on precisely which incentives you are receiving, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to ensure that you are claiming the correct incentives and getting the most money possible.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.