2025 Solar Incentives Guide for Pasadena, MD - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Pasadena.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Pasadena?
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
Local Option - Property Tax Credit for High Performance Buildings
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
Anne Arundel County - Solar and Geothermal Equipment Property Tax Credits
Anne Arundel County - High Performance Dwelling Property Tax Credit
LEED or NGBS Gold: 60% of real property taxes for 5 years
LEED Platinum or NGBS Emerald: 80% of real property taxes for 5 years
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to make renewable energy usage more affordable via financial incentives for individuals who install solar panels on their homes. Incentives could include things like discounts, cash back or monthly utility bill credits. Some incentives are provided by the federal government, while others are provided by the Maryland government or by your specific utility company, county or municipality. Some solar incentives you might qualify for are:
- Tax Exemptions: These might come in the form of property tax exemptions, which allow you to exclude the value added by your solar panels when paying taxes on your house. They may also include exemptions on sales tax at the time of purchase.
- Net Metering: Make sure you talk to your Pasadena utility company about signing a net metering agreement. This allows you to receive credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You may receive either a dollar-for-dollar credit or a percentage of the value.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
- Rebates: Solar rebates can be offered by your local utility company, or by your state or county. These rebates are essentially partial refunds that are applied after you pay for a solar system and before tax credits are calculated.
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives might be available to you if you have a solar system that produces more than a specified (usually small) amount of electricity. Performance-based incentives are typically handled at the state level. You can sell any SRECs you have to your utility company or other buyers, and the money you make is generally considered part of your taxable income.
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Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some familiarity with. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC allows you to claim a tax credit for a set percentage of your solar system's cost.
The ITC can be applied to solar panels installed after January 1, 2006, on a primary or secondary residence in the United States that you own. The credit initially covered 30% of the total cost – for panels, accessories, equipment and labor – although it may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.
Have questions about how the ITC applies to your specific situation? Reach out to your local Pasadena solar panel installation expert to get more information.
The ITC has been renewed and expanded following 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 that are completed between 2022 and 2032, may be eligible for a 30% tax credit. This credit amount will then decrease slightly each year until the current Clean Energy Credit expires in 2035. The expansion to the program also makes it easier to get credit for energy storage systems, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local Pasadena solar panel installation experts can answer your questions and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
Tax credits, rebates and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. The incentives — which may be handled by your county or municipality, or by the state of Maryland — may be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Pasadena
You can receive solar incentives from the Maryland government and the federal government, as well as from your local utility company. The increased availability of solar initiatives in the past 15 years has helped increase nationwide solar energy use enormously. Your local Pasadena solar panel installation company can help you learn more about which incentives you should apply for, and get you on track to switch to renewable energy today.
EcoWatch's Pasadena, MD Solar Incentives FAQs
If I already have a solar system installed on my house, can I still claim incentives?
An excellent idea would be to talk to a representative from the company that installed your solar panels – or call a local Pasadena solar installer — to better understand which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are the highest-rated solar panel installation companies near me?
To find a top-rated solar panel installer, check out our guide to Pasadena's best solar panel companies.
How long until the federal solar tax credit ends?
The Clean Energy Credit (formerly called the federal solar tax credit, or ITC), currently ends on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
If I trade in my appliances for ones that utilize solar energy, are there incentives that I can claim?
The new Inflation Reduction Act introduces a number of incentives that reward homeowners who make eco-friendly upgrades. Some incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
Can I use a combination of multiple types of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Be sure to talk through your plan with your local Pasadena solar installer. They can help you with the plan for your project and educate you on the various incentives that you might or might not qualify for.
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.