Solar Panel Cost in Maryland: Local Pricing Guide (2022)
In this EcoWatch guide on the cost of solar panels in Maryland, you’ll learn:
- What factors affect solar costs in Maryland
- How solar costs vary by system size in Maryland
- What the Residential Clean Energy Grant Program is
- How you can save money when going solar in Maryland
This EcoWatch guide has helped thousands of homeowners in the Old Line State to save time and money on solar energy by providing them with the latest incentives available to them. Let’s get started!
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How Much Do Solar Panels Cost in Maryland?
Maryland has slightly above-average solar energy costs, but prices aren’t unreasonably high.
Based on our market research and data from leading brands, we’ve found that the average cost of solar panels in Maryland is $2.77 per watt. The U.S. average is $2.66 per watt, which means Maryland’s solar costs are 4% above the national average.
Based on this information, you can expect to pay around $13,867 for a 5-kW home solar system in Maryland. However, once you factor in the federal solar tax incentives, the net price for a solar array of this size decreases to $10,261.
The following table provides the typical cost for some common solar system sizes in Maryland:
|Size of Solar Panel System||Cost of Solar Panels in Maryland||Cost After Federal Tax Credit|
Just keep in mind these are averages, and costs can vary widely depending on a number of variables.
What Determines the Cost of Solar Panels in Maryland?
When going solar, the most important factor that determines the cost of your system is your energy consumption, your local electricity rates and how many solar panels you need. Larger homes tend to need more solar panels, but this is not always the case.
For example, a small home with old appliances can consume a larger amount of energy than a large home with newer, energy-efficient appliances.
The cost of a home solar system also depends on what you want to achieve. If you simply want to save money on your utility bills, you can use solar panels on their own to offset part of your energy usage.
On the other hand, if you want an electricity source that will be available day and night, you’ll need to install a solar battery system as well.
The cost of going solar also depends on the equipment brands you pick, how you decide to finance your system and the installation company hired for the job. Let’s discuss how these factors affect the price of your solar PV system.
There are many brands of solar panels and inverters, and each offers different features. For example, some solar manufacturers focus on making affordable products, while others offer the most efficient solar panels that come with higher prices.
System prices also depend on the type of solar panels used: monocrystalline panels have higher wattages and efficiency ratings than polycrystalline panels of the same size, but they also come with higher prices.
The cost of a home solar system also increases if you add more features. For example, if you want a home battery like the Tesla Powerwall or LG Chem RESU, and an advanced monitoring system to track your energy, expect higher installation costs.
Regardless of the solar equipment you pick, make sure you get a solid warranty. As a bare minimum, you will want solar panels with a 10-year product warranty, which is considered the industry standard. However, you can also find brands that offer 25-year warranty coverage.
Related: Lumina Solar put together a great video to let you “tour” their solar energy system.
The total amount paid for your home solar system also depends on how you decide to finance the project. There are three main options: a cash purchase, a solar loan, and a lease or PPA.
|Solar Financing Method||Pros||Cons|
|Cash purchase||+ Will result in the lowest cost, as you’re paying the full price upfront||– You’ll need to pay a large amount of cash at once (over $10,000 for a 5-kW solar system in Maryland)|
|Solar loan||+ Allows you to split the investment into smaller payments
+ You can use your power bill savings to pay off the loan
|– You must pay interest, which increases your overall solar system costs|
|Solar lease or power purchase agreement (PPA)||+ The panels will be installed on your roof at no cost to you||– You’ll still need to pay to access the energy that’s produced by the panels
– The installer owns the system, which means you aren’t eligible to claim any solar incentives
The all-in price of a residential solar system not only includes equipment but also qualified labor. This means the cost of solar panels in Maryland will vary depending on the installation company chosen, even if using the same panels or other components.
We recommend comparing several solar quotes instead of going with the first option available. This way, you can make sure you’re getting a good deal.
But should you go with a local installer or a national, recognized solar company? There are pros and cons of each:
- Local installers may have lower prices, as they must travel a shorter distance and their overhead costs are reduced. They also offer the advantage of being nearby in case you need technical assistance.
- National installers can get discounts for bulk purchasing equipment, and many have local offices or certified technicians that can help out if you need assistance and are far from the company’s headquarters.
In the case of Maryland, we strongly recommend looking for a solar installer with technicians that are certified by the North American Board of Certified Energy Practitioners, NABCEP. This is a mandatory condition for one of the solar incentive programs available in the state.
What Solar Incentives are Available in Maryland?
Maryland offers several solar incentives that improve your return on investment of your home in the DMV area. The following table summarizes the main features of each program, and we also have a dedicated article where you can read more about Maryland solar incentives.
|Maryland Solar Incentive||How it Affects the Cost of Solar Panels in Maryland|
|Renewable Energy Credits||In Maryland, solar photovoltaic (PV) systems earn one Solar Renewable Energy Credit (SREC) for every 1,000 kWh of power they generate.
As of late 2021, Maryland SRECs have been trading for around $78 each. This means you get an extra 7.8 cents per kilowatt-hour in addition to your power bill savings.
|Residential Clean Energy Grant Program||Maryland has a $1,000 rebate program for any approved solar power system with a capacity of at least 1 kW. You must hire a NABCEP certified installer to qualify for this benefit.|
|Tax Exemptions||Home solar systems in Maryland are exempt from the state’s 6% sales tax, and the increase in your home value after the panels are installed is exempt from property tax evaluations.|
|Net Metering||Maryland has a favorable net metering policy for home solar systems. You get full credit for any excess power that you send back to the local utility grid, and the credit can be rolled over to the next month.
Two local providers that offer this are Baltimore Gas and Electric Company (BGE) and Potomac Electric Company (PEPCO).
|Local Solar Incentives||Smaller programs may be available from certain utility companies or municipalities. Before going solar, do some quick research on your area to make sure you don’t miss out.|
|Federal Solar Tax Credit (ITC)||The U.S. offers a federal solar investment tax credit (ITC) that’s worth 26% of your installation costs. This benefit can be applied on top of local incentives.|
FAQs: Maryland Solar Panel Costs
At EcoWatch, we’re happy to get questions about the process and costs of getting rooftop solar from Maryland residents. Below are some of the questions we see most often, along with our responses. If you have specific questions that aren’t answered here, reach out to our team of solar experts at firstname.lastname@example.org.
The average cost of solar panels in Maryland is $2.77 per watt. You can expect to pay $10,261 for a 5kW system installation after subtracting the federal tax credit, and keep in mind you can also qualify for a $1,000 rebate through the state.
In Maryland, you can earn Solar Renewable Energy Credits (SREC) that represent additional cash flow beyond your power bill savings, and the state also has a favorable net metering policy. In addition, there is a local rebate program that offers $1,000 upfront when going solar, and you are exempt from sales and property taxes.
These incentives certainly help solar make sense in Maryland, but whether a solar panel installation is worth it for your home will depend on a number of factors including your home’s energy needs.
Currently, there are no programs that offer free solar panels in Maryland, but your upfront cost is reduced thanks to the local rebate program and several tax deductions. If you are offered “free solar panels” by an installation company, it’s likely a marketing tactic to get you to sign a solar lease or power purchase agreement (PPA).
Leonardo David is an electromechanical engineer, MBA, energy consultant, and technical writer. His energy-efficiency and solar consulting experience cover sectors including banking, textile manufacturing, plastics processing, pharmaceutics, education, food processing, fast food, real estate, and retail. He has also been writing articles about energy and engineering topics since 2015.