Maryland Boosts Solar Incentives 50%

Projects must start in the next 1-2 years and be completed by 2027

Why Should my Company Consider Solar in Maryland?

Companies switching from their local utility to on-site solar for their energy needs is more popular then ever. Likely the largest driver in this trend is the Federal ITC (aka Solar Tax Credit), which is 30%-60% of the project cost for all qualified solar projects. But only a handful of US states offer state incentives for savings above and beyond the ITC. Here we will discuss some important details of Maryland's Solar program and incentives

The State of Maryland has increased their Renewable Portfolio Standard (RPS) target of 25% renewable energy by 2020 to 50% by 2030 (MEA website). This means that Maryland-based utilities are now responsible to purchase SRECs (Solar Renewable Energy Credits) from producers of solar power. This new RPS target is the driving force behind Maryland's generous solar incentives for companies to go solar. Commercial solar will play an integral role in reaching that ambitious goal!

Here are the major takeaways from Maryland's commercial solar incentives:

Includes all MD Utilities: BGE, PEPCO, SMEGO, and others

Full retail net metering provides the most savings - Surplus energy exported to the grid is credited the same amount as retail energy cost

Senate Bill 783 (passed April of 2024) temporarily increases Solar Renewable Energy Credit (SREC) incentives by 1.5x multiplier

Projects must be complete and energized by Jan 1, 2028

Maryland Solar Incentives

Here is more detailed information from the Maryland Energy Administration (MEA) page:

A Maryland-Eligible Renewable Energy Credit (REC) is equal to the environmental attributes associated with 1 megawatt-hour (1,000 kilowatt-hours) of energy generated by a qualified renewable energy system.

For example, if a 500 kilowatt solar array produces 600,000 kWh in a year, the system owner will receive 600 SRECs. These SRECs can receive a value of approximately $30,000 starting in year 1, and continue to receive value over the 25+ year system life.

RECs are entirely separate from the energy generated by a renewable energy facility. RECs have monetary value and can be sold or traded to meet a supplier’s annual compliance obligations as part of Maryland’s Renewable Portfolio Standard (RPS).

Electricity suppliers must purchase and retire SRECs in order to meet their compliance obligations under the law, or pay a Solar Alternative Compliance Payment for any SREC purchase shortfalls. Monetary value from the sale of RECs is typically used to help drive down the cost of deploying renewable energy technologies.

You can find additional information at the Maryland Public Service Commission FAQs page.

Here is an actual SkyQuote from OnSwitch for a 785 kilowatt rooftop solar system in Maryland, and what savings you could achieve with a Purchase or PPA options:

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Which locations qualify for the Program?

Any commercial and industrial sites with a qualified roof or carport that wants to save money and increase company sustainability achievements.

A "qualified" roof or parking lot will have both the appropriate amount of size for the solar array, as well as good orientation towards the sun. This usually means an unobstructed and south and/or west facing roof.

Getting a SkyQuote from OnSwitch is the fastest and easiest way to see if your business location is a good site for solar.

Are there alternatives to spending capital budget for solar?

There are multiple options for installing solar on your commercial or industrial site. By far our most popular option for large and small companies is the Power Purchase Agreement (PPA). Instead of requiring capital investment, a PPA simply allows you to pay a set rate lower than your current cost for electricity. This option can save 10% to 40% depending on your electric usage and utility rates. An added benefit is that the solar project is owned and maintained by a solar financing company, typically for a period of 20-25 years. The financing company is motivated to maintain and maximize production and thereby revenue from the system.

For companies with capital budget available, purchasing a solar system will achieve an excellent simple payback or IRR, an enable your company to receive the Federal Investment Tax Credit directly. Purchased systems will usually pay for themselves in 3-5 years - and have a 25 year warranty on major equipment like solar modules and racking upon which modules are mounted. This means that after the system pays for itself (achieves its breakeven or simple payback), you receive free energy for 20-22 years.

For certain buildings, we can also offer to lease your roof and pay you monthly payments.

Here's a quick comparison of the contracting options:

Contracting Options	Customer Capital Required?	Savings vs. Utility	Payback Period	Tax Credit Monetized by:	Building: Owned or Leased?	Solar Project System Life
Power Purchase Agreement (PPA)	No (20–25 yr term agreement)	10% - 40%	-	Financing company	Customer owns the building (though long-term leases are possible)	25+ years
Capital Purchase	Yes (or Loan)	-	3–5 years	Customer	Customer owns the building, or leases with roof control	25+ years

Is Solar Right for my Company?

Here are some of the top benefits companies experience after going solar:

Reduced operating costs, and hedge against escalating utility rates

Reduced carbon emissions and enhanced sustainability efforts

Positive image to company employees, customers, community, and other stakeholders

Increased building property value and improved attractiveness to future buyers or tenants

Created and sustained local jobs

Here are some things to consider as you're exploring solar:

Do we own the building or have a lease with a long timeframe remaining?

Is the roof relatively new (1-5 years) or ready for replacement?

Do we want to claim reductions in carbon emissions tied to the solar project?

Is my annual electricity consumption steady or projected to increase?

Under what type of contracts are we currently purchasing retail electricity from a supplier?

SkyQuotes by OnSwitch

Receive custom, contract-ready SkyQuotes in 24 Hours to understand what savings you can achieve under the Maryland program

Tell us which business locations you want to evaluate, and you'll receive a SkyQuote with the following:

Custom system design to maximize savings and provide best value using Tier 1 equipment
Detailed financial pro forma detailing tax incentives and payback
Options for capital purchase and Power Purchase Agreements (PPAs)
CO2 emissions avoided by your system and your company

Considering solar for multiple locations?
We can help evaluate your buildings for solar potential in other states with great solar economics, like CA, NJ, and IL. We will provide a SkyPlanner summary dashboard with multiple SkyQuotes for easy comparison and financial planning.

Why Choose OnSwitch?

OnSwitch is a software-driven, turn-key solar developer and contractor with deep experience with solar projects in the commercial and industrial sector, especially rooftops and carports. We have installed solar for numerous commercial buildings including retail chains, manufacturing facilities, and cold storage/logistics centers.

Our leadership has more than 20+ years of experience in solar and has developed and built more than $1 Billion in solar projects. See our PROJECTS here.

We were named a Top Solar Contractor in 2023 by Solar Power World for our work in the commercial and industrial sector.

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