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Maryland's New Energy Bills Boost Solar

Maryland Governor Martin O'Malley today signed into law five energy-related bills that aim to promote renewable power and accelerate the creation of green jobs across the state. A number of the new provisions are relevant -- and helpful -- to Maryland solar installations, which is music to our ears...

Here's an overview of the new legislation, along with a brief explanation of what each provision might mean for solar buyers and the industry at large:

  • Under the state's renewables portfolio standard (RPS), two percent of the state's electricity mix is supposed to come from solar resources by 2022. Maryland Senate Bill (SB) 277, just passed, will accelerate the timetable under which utilities are required to meet that goal. Between 2011 and 2016, utilities will have to install more solar generating capacity than was previously required under Maryland's RPS mandate. Bottom line: this means more solar in Maryland, sooner.
  • SB 277 also raises the penalty utilities must pay if they fail to meet their RPS obligations. Known as the alternative compliance payment (ACP), this rate will increase by a nickel per kilowatt-hour (kWh) in 2011 and 2012, and by a dime/kWh between 2013 and 2016. According to the DSIRE database, the 2010 ACP is $0.40/kWh. Bottom line: this raises the relative price competitiveness of solar energy technologies, like solar panels.
  • The Maryland Clean Energy Incentive Act of 2010 (House Bill 464) extends a clean energy tax credit through 2015, which will be a great boon to buyers interested in residential solar or commercial solar installations. The credit is based on production -- that is, on the amount of kWhs generated by solar panels or other qualifying renewable energy systems. HB 464 not only extends the Maryland solar tax credit, it also: (1) ensures that buyers don't receive an initial credit worth less than $1,000, and (2) makes the credit refundable, which means buyers will get back any remaining unused credit in the form of a check. Bottom line: the Maryland solar tax credit has been resurrected for a few more years and it's worth taking advantage of.

Also included among the freshly inked bills are HB 469, which exempts plug-in electric vehicles from state excise tax, and SB 602/HB 674, which lets drivers of plug-in electric cars use the HOV lane. Bottom line: buy a plug-in electric and you can dodge the tax man AND trim your morning commute.

We'll wrap it up with a quote from the Governor himself:

“Energy touches every aspect of our lives from the cost of heating our homes to sustaining our resources for future generations. In these last three years, we have made the choices that have transformed Maryland into one of the leading clean energy states in the nation. Each of the bills signed into law today will provide resources and incentives for our families and workforce, create jobs, and fuel innovation as we continue to strive for a Maryland that is truly Smart, Green and Growing.”

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