Perhaps the biggest myth about solar energy is that it is too expensive. The reality is that solar energy is more affordable than ever. In fact, according to the Solar Energy Industries Association (SEIA), the cost of solar panels is down 70% since 2009. But it is more than just low cost that makes the investment of solar energy affordable. Federal, state and local grants and incentives help to reduce the upfront cost of installation as well. Maryland solar incentives are considered to be among the top of the table.
On the Federal level, incentives for solar energy were introduced as part of the American Recovery and Reinvestment Act 2009. Customers who go solar receive a tax credit equal to 30% of the cost of installation for renewable energy systems, including solar electric, solar hot water, and photovoltaic solar panel systems. The best part? There is no cap to the credit, so residents receive the full 30% credit no matter how large or small the installation.
While everyone is eligible for Federal tax incentives, states and local incentives vary a great deal. In fact, incentives don’t just come from the government. Local utilities offer rebates and incentives for switching to renewable energy. Incentives also vary in form, whether they be tax deductions, rebates or grants.
Solar incentives and grants change regularly and are different for every location. If you want a comprehensive look at what benefits might be available to you, then you might consider scheduling a free solar analysis, where one of Solar Energy World’s representatives can go over all your options in specific detail.
Using solar panels can help save money on energy bills. In addition, there are several state and federal incentives, such as grants and tax credits that can make solar energy such a great investment. But just how much money can you save? The number might be surprising.
To get an idea of how much savings a photovoltaic solar system provides, visit our solar savings calculator. It takes into consideration factors such as average monthly electricity bill, the state and county of residence, and how much electricity the system produces to give you a general idea of how much you can save and what incentives are available.
As an example, let’s assume that a resident in Anne Arundel County, Md., is interested in installing solar panels. The family’s average electricity bill is $150 and they want their solar system to provide 50 percent of their electricity. Supposing that the house is situated in a way that the panels would point due south, this resident could reach $17,581.00 in savings and incentives.
Seem too good to be true? Here is how it breaks down. The family would save $900 annually in utility bills and would produce 5 Solar Renewable Energy Credits a year that can be sold to electric companies who have not met their quota in producing solar energy. The resident would also be eligible for a $2,445.00 state grant, $2,500 property tax credit, and an $11,763 federal tax credit.
Every home is different, and state and federal credits not only vary by location, but are constantly changing. The calculator will give interested solar energy consumers an estimate in terms of solar incentives. The best way to figure out how much you can benefit from installing a solar system is to schedule a free, no obligation home solar analysis. One of our experts can provide you all the details on current incentives and a specific solar plan customized for your home.
New Jersey is the most densely populated state resulting in a real effort to preserve the state’s remaining open spaces. This has limited the prospect of a large utility-scale solar energy installations. The state also experienced a period of heavy industrialization in the absence of environmental regulations, and has responded by tightening said regulations significantly.
The big reason why Jersey can use solar energy is that the state’s energy economy makes renewable power easier to sell. New Jersey gets about half of its power from nuclear plants and imports about 30% power from other states. The bulk of New Jersey’s expanding electricity need to be met by coal and natural gas. All of these factors keep New Jersey’s electricity prices in line with nearby states. Renewable’s prices don’t have to come down as far in price to become competitive.
The state also imposed a renewable energy standard that dictates, by 2020, it will receive 20 percent of its energy from renewable sources.
There were limited energy options for New Jersey. New Jersey generally has flat topography meaning that hydropower isn’t much of an option. Many of the estuaries and rivers that do flow into the ocean in New Jersey have excellent potential as sources of tidal power, but that technology hasn’t yet advanced far enough to allow deployment. Due to the fact that open land is so precious and preserved, New Jersey did not really have many options other than to turn to solar energy, unless it wanted to build a big utility facility. However, in terms of space for solar energy, rooftops are everywhere- enter the photovoltaic solar panel system.
In addition to the political and economic situation of New Jersey the state devised a system based on what are called Solar Renewable Energy Certificates, or SRECs. The utilities can buy SREC bundles and use them to meet their annual quota of renewable power; falling short will net them a fee. An example of this can be seen from 2009 when it was required that Jersey Central Power and Light and Public Service Electric and Gas obtain 20% of their power from solar. The SREC market acts as a cap and trade system with a maximum value for the SRECs.
Unlike SRECs, selling the credits that your system produces, you can save money by saving electricity. As your system produces electricity and sends excess back to the grid, your meter is running backwards or keeping track of electricity sent. When your system is not producing electricity it is pulling electricity from the grid at no charge if you are using what you contributed at an earlier period. Through this process you can save money on your monthly electricity bills while also receiving money from selling your SRECs credits.
These characteristics make renewable so easy to sell in New Jersey that could not be sold anywhere else due to the limited competitiveness of the renewable market. The Maryland solar industry is attempting to model the state’s policies after regulations found in New Jersey.
Post written by: David Zamostny, Solar Energy World Intern
In 2009, Congress passed The American Recovery and Reinvestment Act to extend consumer tax incentives started by the 2005 Energy Act. That equals big tax rebates for you when you choose to invest in sustainable energy home improvements.
So how big are these rebates? Homeowners who invest in solar energy systems will receive a 30% federal tax credit as long as the systems are in place by the end of 2016.
In Maryland, several counties offer property tax credits. Howard County, for example, allows a tax credit that is 50% of the eligible costs up to $5,000 for electricity generating or heat generating systems, and $1,500 for a hot water supply system.
Daunted by the idea of the paperwork and details that go into claiming those tax credits? Don’t be.
We will do all of it for you. Contact us to learn more!
Please note, this post was written prior to the change in the Howard County Property Tax.
According to a report by the Solar Energy Industry Association (SEIA), published March 10, 2011, the US solar energy industry had a banner year in 2010 and is a bight spot in the US economy as the fastest growing sector. In contrast to the US GDP growth of 2.8%, the US solar market grew 67% in value in 2010 (SEIA executive summary).
US demand growth was, however, outpaced by a global market boom driven primarily by Germany and Italy. It’s reported that the growth in Europe was due to the large government incentives available at the time. However, those incentives have since expired.
The US solar market grew from $3.6 billion in 2009 more than doubling in 2010.
It’s expected that the US opportunity to expand its share in 2011 while the global market slows down. The numbers of installations are likely to double in 2011 in the US. Much of the global PV industry is turning its eye to the US with great expectations.
In 2007, only four US states installed more than 10 megawatts of PV. Now, 16 states have accomplished that feat, notably Arizona, California, Colorado, Nevada and New Jersey installed more than 50 megawatts. In 2010, New Jersey more than double it’s installations, ranking the 2nd largest state for solar installations with more than 100 megawatts in a single year.
“This report shows that solar energy is now one of the fastest growing industries in the United States, creating new opportunities for both large and small businesses. Every day, Americans across the country are going to work at well-paying, stable jobs at solar companies, from small installers all the way up to Fortune 500 companies,” said Rhone Resch, SEIA president and CEO. “This remarkable growth puts the solar industry’s goal of powering 2 million homes annually by 2015 within reach. Achieving such amazing growth during the economic downturn shows that smart polices combined with American ingenuity adds up to a great return on investment for the public. The bottom line is that the solar energy industry is creating tens of thousands of new American jobs each year.”
While New Jersey has outpaced even California, Maryland isn’t even on the map.
Maryland was one of the first states to adopt a Renewable Portfolio Standard in 2004. A solar “carve-out” was added in 2007, requiring that a percentage of the renewable portfolio standard must originate from in-state solar generated electricity; the percentage gradually ramps up to 2% by 2022. In April 2008 Governor Martin O’Malley signed Senate Bill 209, which accelerates the RPS to require that 20 percent of the state’s electricity supply come from renewable sources by 2022. In 2010, the Maryland legislature adopted provisions that further accelerated the RPS requirements in the early years (2011 through 2017), resulting in more residential and commercial solar installations during this period.
MDV-SEIA, the Maryland, Washington DC, Virginia chapter, is working on policy changes to fast track change, making it possible to hit the state requirements by 2022.
Overall, the state is at 27% of its 2022 goal.
Way to go New Jersey! Let’s get going Maryland! Be part of the solar revolution, green jobs and solar savings!
Lowering the temperature on your hot water heater to 120 degrees can create even greater energy savings. Setting the thermostat down will save energy without losing the comfort of a long and relaxing bath.
According to the DOE, for each 10 degrees reduction in water temperature, you can save between 3-5% in energy costs.
Reducing your temperature to 120 degrees also slows mineral buildup and corrosion in your water heater and pipes. It also helps the water heater operate a maximum efficiency.
Water heating accounts for approximately 20-30% of your energy bill so taking smart measures to reduce energy costs can be as simple as reducing the temperature on the heater. If you really want to shave off more, consider solar hot water.
This video shows you how solar hot water systems work.
Earlier this week, President Obama delivered his State of the Union Address and touched on the topic of clean energy. Here are some excerpts we found particularly interesting:
We’ll invest in biomedical research, information technology, and especially clean energy technology — an investment that will strengthen our security, protect our planet, and create countless new jobs for our people.
… We’re not just handing out money. We’re issuing a challenge. We’re telling America’s scientists and engineers that if they assemble teams of the best minds in their fields, and focus on the hardest problems in clean energy, we’ll fund the Apollo projects of our time.
… We need to get behind this innovation. And to help pay for it, I’m asking Congress to eliminate the billions in taxpayer dollars we currently give to oil companies. I don’t know if — I don’t know if you’ve noticed, but they’re doing just fine on their own. So instead of subsidizing yesterday’s energy, let’s invest in tomorrow’s.
Now, clean energy breakthroughs will only translate into clean energy jobs if businesses know there will be a market for what they’re selling. So tonight, I challenge you to join me in setting a new goal: By 2035, 80 percent of America’s electricity will come from clean energy sources.
We’re excited to have greater backing and encouragement of solar energy in 2011 and moving forward. We accept the President’s challenge and will continue to meet the highest standards of solar energy production – for you and for our environment.
When calculating the cost of solar panels, it’s important to consider more than just the sticker price. While the initial installation may seem like a lot of up-front costs, the cost-savings over the life of the solar panels and incentives available can help to off-set the investment.
You can calculate an approximate savings with our Solar Savings Calculator. Let’s say you pay an average of $300/month in utilities, would like to offset that cost by 25 percent. You live in Anne Arundel County in Maryland, and your house is oriented toward the south. You would ultimately save almost $19,000 in incentives, including utility costs, Federal and property tax credits, and state grants.
- Residential renewable energy tax credits: 30% tax credit for residential solar energy systems installed before December 31, 2016
- Washington DC renewable energy incentive program: 1kW+ systems qualify for $1-3 incentives on solar and wind energy systems
- Maryland solar energy grant program: Solar photovoltaic systems under 20kW earn grants from $0.35-1.25/Watt. Solar hot water installation receives 30% of the installed cost up to a $2,000 maximum grant
- Maryland county property tax credits: Various tax credits available in Anne Arundel, Harford, Howard, Montgomery, and Prince George’s counties
- New Jersey renewable energy rebate program: Solar photovoltaic systems under 10,000 watts earn grants of $0.75/watt for systems up to 7.5kW.
There are many factors that have made solar panels for your home more affordable in recent years, but Solar Renewable Energy Credits, or SRECs, are possibly one of the most important.
So what are they? Think of them like a stock. One SREC represents the monetary value of 1,000 kilowatt-hours (kWh) produced. That value changes every day based on how much energy is produced across the state, how much energy is being used, and what portion of that energy comes from renewable resources (which includes wind power generation, geothermal, biomass, etc.).
In an effort to combat the effects of climate change and dependency on foreign oil, federal, state and local governments require utilities to have a certain percentage of their energy produced from renewable resources. In Maryland, utilities are required to have 15% of all electricity generated to come from renewable energy sources by 2022, of which 2% must come from solar power. Those percentages are phased in over time, which means that each year utilities must either produce that energy themselves or purchase energy credits.
And that’s where the value of SRECs is determined. It is easier and less expensive for utilities to purchase credits than to build new energy production facilities. The less energy they produce from solar and other renewable, the greater the value of the SRECs. And as energy demand continues to grow, the value of those SRECs will also continue to grow. That means that the longer you keep your SRECs, the more valuable they will be.
How many SRECs your system earns each year will entirely be based on the size of the system. When we do a solar analysis, we help you calculate what the cost/benefit is, taking into account the SRECs your solar panel system will earn.
Take note: a solar thermal system (also known as solar hot water) does not earn SRECs! They can, however, help you dramatically lower your utility bills.
Also note: SRECs are not the same as net metering, which requires utility companies to give solar electricity owners a credit if their system generates more electricity than is supplied by the grid.
One of the systems we’re particularly proud of is a unique ground install in Bowie, MD. The Blackwells, the family who hired Solar Energy World, were facing a rather steep $7,550 annual electricity bill.
The Blackwell’s are the owners of a large single-family home built in 2006 in Bowie, Maryland. The two-story home sits upon an approximate 40,000 square foot lot. So, with available space, the Blackwell’s explored the use of ground mounted solar panels to reduce their energy costs.
Our solar analysis showed that the Blackwells that it pays to go solar. The family opted for a 10.32kW solar electric system that includes 48 – 215 watt ground mounted panels. After the federal tax credit, state grant and local property tax credits, the Blackwell’s expect their solar panel system to cost nearly 50% off of the total installation cost.
In addition to the government incentives, the Blackwell’s will be saving $2,471 per year on their electricity bills and earning $4,435 per year by selling their Solar Renewable Energy Credits; making their ground mounted solar electric system pay back in less than 6 years.
We also installed an Enphase monitoring system along with the solar panels. The monitoring system showed that in just the first 10-days of operation, the system produced 505 kilowatt hours; which could power 1,529 light bulbs, 505 computers and 15 homes for one day.
Powering up the Blackwell’s solar panel system also reduced their carbon footprint, with a carbon offset of 865lbs. Within the same 10-day period the offset equivalent of planting 10 trees, not consuming 45 gallons of gas, and not driving 26 cars for a day.