Solar energy not only helps make our planet a greener place, but can help homeowners save a lot of money on taxes and earn other financial incentives, making solar panel installation a very lucrative investment. In many cases, the incentives you are eligible for depends on if you own or lease your solar panels and/or when you purchased your solar panels, but did you know the incentives you qualify for may also depend on where you live?
The incentives available to owners of solar panels vary a little in Virginia, DC, and Maryland, so it is crucial that you understand your state’s regulations. Prospect Solar is proud to serve the DC metro region with solar panel installation. We are here to help homeowners understand the economic benefits of solar energy. Below is our quick guide to solar economic incentives in Virginia, DC, and Maryland.
Solar Power Incentive Terms
To understand some of the state incentives, you must understand some of the terms associated with different incentives. Some states have a Renewable Portfolio Standard (RPS) which encourages state-wide benefits. This is a law that requires that a certain percentage of all state energy generation is provided by renewable sources. Utility companies who do not meet this requirement must pay high fees.
The Solar Renewable Energy Credit (SREC) is a credit that pays homeowners back for every megawatt-hour of energy that their solar panels generate.
Solar Power Incentives in Virginia
Virginia’s solar incentives are not as flexible as many other states. Virginia does not have a RPS and does not offer any state-wide incentives, such as a state tax credit. However, if you own solar panels in Virginia, you are still eligible for the federal tax credit, which gives you a 30% credit on your federal taxes. While there is no state-wide SREC in Virginia, either they are able to be sold into Pennsylvania’s market with the help of a broker.
Although the state incentives in Virginia are a bit limiting, solar energy can still help Virginians save money on their monthly energy bills.
Solar Power Incentives in DC
Washington DC offers noticeably better incentives than Virginia. Like Virginia, DC does not offer a district-wide tax credit, but solar power owners are again eligible for the federal tax credit. DC offers an impressive RPS, on the other hand. In Washington DC, 2.5% of all energy must be produced by solar power by 2023, and 50% of all energy must be generated0 by renewable sources by the end of 2032. Utility companies face penalties and fines if they do not abide by this RPS. They must also pay users an SREC for every mega-watt hour they produce with solar panels to comply.
The incentives in Washington DC help make solar a much more lucrative investment for solar panel owners and help earn them more savings every year.
Solar Power Incentives in Maryland
Maryland also offers solar panel owners decent savings with state incentives. Maryland features a significant RPS, with the requirement that 20% of produced energy must be generated by renewable sources, and 2% of energy must be generated by solar power by the end of 2022. Maryland does offer a state tax credit, but only to very big solar panel systems and for a small amount. Solar panel owners in Maryland are also eligible for SRECs, and will receive payment for every megawatt-hour their solar system produces. The market is a bit flooded at the moment, making each SREC worth less value than in recent previous years.
Like Washington DC, investing in solar energy in Maryland is a strong investment that can save you a lot of money.
Learn More About State Incentives at Prospect Solar!
Are you considering installing solar panels for your Virginia, DC, or Maryland home? Prospect Solar can walk you through the process of purchasing your solar panels and understanding what incentives are available to you.
To learn more about state incentives and to begin your solar panel installation, contact Prospect Solar now!