2024 Solar Incentives Guide for Potomac, MD - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Potomac.
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 Potomac?
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
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
Appliances
Clothes Dryer: $50
Clothes Washer: $75 - $100
Hybrid Water Heater: $500
Pool Pump: $150 - $400
Refrigerator: $100
Smart Thermostat: $100
Dehumidifier: $30
HVAC
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
Recycling
Refrigerator or Freezer: $50
Room A/C or Dehumidifier: $25
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are intended to make renewable energy usage more affordable through 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 offered by the Maryland government or your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar panels. Property tax exemptions let you exclude the added value of your solar system when calculating how much property tax you need to pay.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
- Rebates: A solar rebate is a partial refund after the purchase of your solar panels. Rebates might be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
- Net Metering: Net metering factors in once your solar panels are up and running. If you have a net metering agreement with your Potomac utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this credit is dollar-for-dollar, while in other places you might be refunded a percentage of the value.
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that normally counts as part of your taxable income. Typically, you must meet a certain (small) threshold of energy production before your solar system qualifies for SRECs or other performance-based incentives. These kinds of incentives are generally handled by your state government.
Best for Leasing
Sunrun
- Expansive service area
- Many financing options
- Some reported issues with customer service
- Some reported issues with door-to-door sales
Solar Veteran
Trinity Solar
- Many financing options
- Family-owned and -operated
- Makes charitable contributions
- Limited service area
- Relatively short workmanship warranty
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Federal Solar Incentives
When thinking about solar incentives, you probably think of federal incentives first. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a specified 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 system has to have been installed on a property you own after January 1, 2006, for you to be eligible for the credit. The ITC initially covered 30% of all installation costs (panels, labor, accessories and equipment), although the total 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.
Contacting your local Potomac solar panel installation expert is the best way to understand how the ITC applies to your situation.
In August 2022, the ITC (now titled the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. Under the new program, 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. Starting in 2023, the expansion to the program will also make it easier to get credit for energy storage systems.
Click here to learn more about the new Inflation Reduction Act. Your local Potomac solar panel company is the best resource for answering your questions about the new Clean Energy Credit and how it may apply to you.
State & Local Solar Incentives
Rebates, tax credits and more can be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. Some incentives are ongoing, while others are only available for a limited time. Solar incentives might be given by the Maryland government, or by your county or municipality.
Next Steps for Installing Solar in Potomac
There are many kinds of solar incentives: those given by the federal government, those given by the Maryland government and those offered by local utility companies, to name a few. Solar energy use has increased tremendously in the last 15 years, thanks to these incentives. Your local Potomac solar panel installation company can help you learn more about which incentives you may qualify for, and get you started on the path to switching to renewable energy today.
EcoWatch's Potomac, MD Solar Incentives FAQs
How long until the federal solar tax credit ends?
The federal solar tax credit, previously called the ITC and now titled the Clean Energy Credit, is scheduled to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
I want to switch my appliances out for ones that are more energy-efficient. Are there any benefits I can apply for?
The new Inflation Reduction Act creates a variety of new financial incentives that are available when you make eco-friendly improvements to your home. More details regarding these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can claim both rebates and tax credits towards the cost of solar panels. Depending on which incentives you are eligible for, they may apply in a different order. Make sure that you talk to your solar installer or a local tax professional to ensure that you are claiming incentives correctly and that you're getting the most money possible.
What if I add solar panels to a vacation home, rental property or commercial property? Will I still qualify for incentives?
While we recommend speaking with your local solar installer and/or tax professional to fully understand what solar incentives apply to you, many incentives apply to a second home, as long as it is in the United States and owned by you. There may be additional incentives available specifically for commercial properties, depending on the specifics.
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.