Residential Rooftop Solar in Maryland: Frequently Asked Questions

Maryland law permits an electric-utility customer to install solar panels on their home to generate electricity. The customer then uses the electricity to power their home. Each kilowatt-hour of energy the panels generate results in the electricity supplier charging one less kilowatt-hour of electricity to the customer. Electricity suppliers charge customers only for electricity the customers that exceeds the power their rooftop panels produce. This is called “net-energy metering.”

Net-energy metering is a billing arrangement that allows customers who generate their own electricity—typically through solar panels—to receive credits on their utility bill for any excess electricity they send back to the electricity grid for use by others. In Maryland, net-energy metering customers receive credits on their utility bill at the same rate they pay for the electricity they consume.

With net-energy metering, your electric utility will only bill you for your net energy consumption in each billing period. Your net consumption is the difference between the electricity you generate and the electricity you consume. If you generate more electricity than you consume, the excess will be credited to your account and used to offset future energy bills. These credits are applied as either a dollar or kilowatt hour credit to reduce the kilowatt hour charges on the customer’s bill.

Yes. Maryland’s net-metering law requires utilities to provide credits for any excess electricity your rooftop solar panels generate. You can use the credits to offset future energy bills. You can choose to indefinitely accrue credits or you can ask the utility to do a true-up in April of the year. If you choose April, your electric utility will reconcile your account so that if your rooftop solar has generated more electricity than you used, your utility will pay you for the excess generation. The amounts the utilities pay for this excess generation will not be the full retail rate that you received as credits but are instead paid at a lower “excess generation” rate.

No. While Maryland law limits the size of your rooftop solar system, Maryland has no limit on the amount of electricity that a utility can credit to your account through net metering. Any excess electricity your rooftop array generates will be credited to your account and used to offset future energy bills.

No. Electric utilities are not permitted to charge net-energy metering customers any additional fees or charges in Maryland. You are responsible for the costs of the solar system itself, including its purchase, installation, maintenance, and repair. Some customers lease or purchase their panels from a solar company that handles any necessary maintenance and repair.

Yes. Maryland requires that any equipment you use in a net metered system such as a rooftop solar array meet applicable safety and performance standards established in the electric utility tariffs the Maryland Public Service Commission approves. You may contact your utility to obtain additional information about these standards and the process for applying for the installation of a solar system.

There are three primary ways for you to obtain a rooftop solar system if you are a residential customer, including:

Regardless of the option you choose, it is important to research and compare different solar providers and options and to have a professional assess the feasibility of a solar installation on your property.

The cost of a solar panel installation can vary depending on several factors, such as the size of the system, location, and the type of panels used. On average, a residential solar panel system can cost between $10,000 to $30,000 before any incentives or rebates.

Yes. If you own your solar system, you will receive one renewable-energy credit for each 1,000 kilowatt-hours of electricity produced by your system. You have three years to sell the credit.

Yes. Several incentives are currently available to encourage customers to install solar panels on their homes, including tax credits, rebates, grants, and other incentive programs. These incentives can greatly reduce the overall costs of installing solar panels.

If you are a Maryland utility customer, you currently are eligible for a Federal Solar Investment Tax Credit that permits you to deduct 30 percent of the cost of a rooftop solar installation on your federal income tax return. Maryland also offers a one-time grant of $1,000 for the installation of a rooftop solar system under the State’s Residential Clean Energy Rebate Program.

Other tax credits, rebates, and incentives are available through local government programs, depending on where you live. It’s important to check the availability of these incentives and their qualifications. Information on incentives offered by your municipality or county government can be found on these local governments’ websites. You can also find more information about available incentives on the web, such as through the database maintained at DSIRE.org at: programs.dsireusa.org/system/program/md.

Most likely, yes. Most homes are suitable for solar panel installation. However, factors such as the orientation of your roof, shading from trees or nearby buildings, and the age and condition of your roof can affect the feasibility of a solar panel installation. A south-facing roof is ideal for solar panel installation as it will receive the most sunlight. However, east- and west-facing roofs can also work, though they will produce less electricity. A professional solar installer will be able to assess your home and determine if it's suitable for solar panels.

The amount of money you can save on your electricity bill with solar panels depends on a number of factors, including the size of the system, your electricity usage, and the cost of electricity in your area. Solar system installers can provide you with an estimate of the savings you can expect by conducting a site-survey of your property.

Currently, there is no expiration date for the net-energy metering program in Maryland. However, the program limits to 3,000 megawatts the generation capacity available to be used for net-energy metering. As of January 2023, projects totaling approximately 1,033 megawatts are in place. Any systems installed before the maximum cap is reached will continue to receive credits over the life of the system.

Solar panels have a lifespan of 25 to 30 years. However, they will produce electricity at a reduced efficiency as time goes on.

Community solar allows utility customers who rent their homes or otherwise are unable to purchase or lease rooftop solar panels to power their households with solar energy through a subscription arrangement with a community solar project. For this reason, community solar is more readily available to tenants and low- and moderate-income households. A utility customer may have rooftop solar and also subscribe to community solar. The credits for community solar impact the subscriber’s bill in the same way that electricity produced by rooftop solar impacts the homeowner’s bill. OPC has available here a separate set of frequently-asked-questions for community solar: opc.maryland.gov/Consumer-Learning/Renewable-Energy/Community-Solar