2022 Maine Solar Incentives, Tax Credits, Rebates (And More)
Here’s a quick look at the solar incentives in Maine:
- Federal Solar Tax Credit
- Net Metering
- Property Tax Exemption
- Home Energy Loan Program
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Solar energy isn’t taking off in Maine as fast as it is in other parts of New England, but it’s slowly growing. As of 2022, the state ranks 36th in the country for solar installations, with more commercial solar installations than residential ones.1 However, with the cost of solar dropping and the cost of standard electricity rising, it’s only a matter of time until Maine homeowners start reaping the benefits of going solar.
While Maine may be lacking in financial incentives for renewable energy systems as of 2022, the state is looking to pass new legislation to address the huge influx of solar projects. That, coupled with Maine’s Renewable Portfolio Standard (RPS) goal to achieve 80% renewable energy by 2030, could lead to more incentives to go solar in the Pine Tree State.2
Whether you’re looking to go solar to lower your electric bill or gain independence from utility companies, we want you to take advantage of any solar incentives available to Maine homeowners.
Disclaimer: This article is for informational purposes only. It should not be relied on for and is not intended to provide accounting, legal or tax advice.
Current Solar Rebates, Tax Credits, and Incentive Programs in Maine
Here’s an overview of the leading solar incentives and rebates in Maine. We’ll go into the specifics of each below.
|Maine Solar Incentive||Description|
|Net Metering||Maine’s net metering policy — also called Net Energy Billing (NEB) in the state — allows solar customers to receive credits for any extra electricity their solar system produces. These can be used to offset bills in months when a system doesn’t generate as much power.3|
|Maine’s Renewable Energy Investment Exemption||Although installing solar panels will up your home’s value, this program exempts residents who use renewable energy equipment — including solar panels — from seeing higher property taxes due to their installations.4|
|Federal Solar Tax Credit||The federal solar investment tax credit, or ITC, allows homeowners to claim 26% of their system costs as a credit against the federal taxes they owe. The credit is set to reduce to 22% in 2023 and will be eliminated for residential systems in 2024 unless it is extended by the federal government.5|
Maine Solar Incentives
As we mentioned earlier, solar is a slow-growing industry in Maine. However, that’s not to say the state and its residents are fighting renewable energy alternatives. In fact, in 2020, 79% of Maine’s in-state electricity net generation came from renewable resources, mostly from wind and hydropower.6
That said, it doesn’t leave a lot of room for solar in Maine’s Renewable Portfolio Standard, so Maine does not offer a statewide tax credit or many other incentives for Mainers who go solar. Instead, the state government leans on its favorable net metering policy to entice residents to install solar power systems.
Net Metering in Maine
During peak sunlight hours, it’s possible that a solar energy system will produce more power than a home needs. Net metering policies allow that excess power to be fed back into the local electric grid in exchange for credits from utility companies. These credits can be used to offset future power bills.
Maine’s net metering policy — also called Net Energy Billing (NEB) in the state — saw a huge win in 2019 when the government repealed gross metering in favor of this true net metering policy.7 The current net metering policy is much more supportive of solar energy systems, providing a one-to-one credit for electricity generation sent to the grid without the need to meter the generation consumed on-site.
The good news is this policy change has led to a huge influx of solar projects in the state. The bad news is Maine’s Public Utilities Commission has been struggling with the demand, leaving many solar electric customers with delays and holdups to get their net metering applications pushed through.8
Maine Solar Property Tax Exemption
As of April 2020, all renewable energy equipment, including solar photovoltaic (PV) systems, is exempt from property tax assessments.9 This means that, while your home value will increase as a result of going solar, you won’t have to pay the higher property taxes that would normally follow suit. Taxpayers must apply for the exemption by April of the first year they install the panels.
Maine does not currently offer a sales tax exemption for solar PV systems.
Maine Solar Easement Rights and Laws
In 2009, Maine enacted a law that gave all residents the right to use solar or wind energy devices on their properties.10 That means that landlords and homeowners associations (HOAs) cannot restrict residents from going solar.
Maine Energy Efficiency Financing
Efficiency Maine offers a Home Energy Loan Program for various residential energy-efficiency upgrades. While Efficiency Maine is not currently offering incentives for solar, it does offer rebates and loans for upgrades including electric vehicle chargers, LED light bulbs and heat pumps.11
Federal Solar Tax Credit
When you install solar panels on your Maine home, you become eligible for the solar investment tax credit (ITC) — also known as the federal solar tax credit — which you can claim on your federal returns. The solar tax credit is not a set dollar amount, but rather a percentage of what you spend to install your residential solar system.
The tax credit is currently set at 26% of your total system cost but is expected to decrease in 2023 and disappear completely for residential systems come 2024, so the sooner you install your solar panel system, the better your savings will be.12
FAQ: Maine Solar Incentives
At EcoWatch, we get questions regularly from readers in Maine looking to go solar. Here are some common questions we see, along with our answers:
No, as of 2022, Maine does not have a statewide solar tax credit. However, all residents are able to claim the federal solar tax credit, which is currently worth 26% of total installed system costs.
Maine’s biggest solar incentive — its net metering policy — isn’t set to expire anytime soon. The state also has a property tax exemption and solar easement laws that make solar more accessible in 2022.
Maine doesn’t offer any statewide solar rebates, but that doesn’t mean there aren’t any available. Certain solar manufacturers will offer special rebates on their equipment.
No. Even though installing solar panels boost your home’s value, your property taxes won’t budge due to Maine’s Renewable Energy Investment Exemption.13