Annapolis, MD Solar: 2026 Costs, Incentives & Savings

Solar Power in Annapolis

If you live in Annapolis, you’ve likely noticed your electricity bills climbing. Maryland residential rates now average 17.88 cents per kWh. Prices have also jumped 37% from 2020 to 2024. With plenty of sunny days along the Chesapeake, many local homeowners are turning to solar to take more control over rising energy costs.

You’re in the right place to learn how it works. At Palmetto, we’ve helped homeowners across Maryland go solar, and this guide breaks down the basics of home solar panels so you can decide what’s right for your home.

MARYLAND by the Numbers

10th Most residential solar in the United States
100 Households have installed solar panels
4.9 Avg peak sun hours per day
~$93k Annapolis average savings over 25 years

How Much Do Solar Panels Cost in Annapolis, MD?

See real solar installation costs for Annapolis, built from our actual local install data across neighborhoods like Eastport, Parole, Hillsmere Shores, and Admiral Heights. Instead of rough estimates, this calculator uses firsthand numbers from homes near you, giving a clear, honest picture of what solar could cost.

Lease
Cash Purchase

Small Home Up to 2,000 sq ft
Medium Home 2,000-3,000 sq ft
Large Home Over 3,000 sq ft

System Size

This system size is designed to offset approximately 100% of the average electricity usage for a home of this size in Maryland.

Recommended System

10.25 kW

Your Monthly Payment
Estimated monthly cost with LightReach
$124/mo
As low as
$124/mo

Why Lease Solar?

Following the 2025 Big Beautiful Bill, the federal 30% solar tax credit is no longer available for cash purchases. With a LightReach lease, Palmetto owns the system and still qualifies for the commercial ITC — passing those savings through to you via lower monthly payments.

• No upfront investment
• Palmetto handles all maintenance
• 90% Production Guarantee
• Comprehensive protection program included

Cost Breakdown

Your estimated investment
System Cost
$29,165

Price per Watt
$2.85

Final Cost
$29,165

Savings
Your total financial benefit

Monthly Savings
Average utility bill reduction
$213

Payback Period
Break-even point
9.8 years

25-Year Savings
$93,252
Get Your Personalized Quote

Palmetto Reviews

Palmetto Solar has been nothing but solid for me. Their app is clean, easy to use, and honestly kind of addictive — I catch myself checking my energy production like it’s a scoreboard. And the savings on my electric bill are the real deal. Every month I’m seeing the difference. Their customer service deserves a shoutout too. Every time I reached out, they were friendly, patient, and actually helpful. No runaround, no “we’ll get back to you someday” energy — just people who know their stuff and take care of you. If you’re thinking about going solar, Palmetto makes the whole thing smooth, simple, and worth it.

Jesse Richardson
Annapolis, Maryland

Palmetto Solar is a fantastic solar company to work with. They provide great communication every step of the way. Customer service is excellent! Keeping their customers fully informed of just how simple the solar install and payment set up is, plus keeping my expectations of the process very simple. They are available to speak to, which makes it easy to understand how things work once all is completed. I highly recommend Palmetto Solar.

Maria Margaritis
Maryland, Maryland

I resisted going solar for years because of the cost of installation that many quoted when they came to my door. Someone finally came to my door from Palmetto and offered a solar plan that didn’t cost me a penny to install. They looked at my power bill and told me how many panels they would install and that they would only bill me $83 a month. My wife and I did the math and said okay. After everything was installed and up and running, they emailed me that my monthly bill would only be $63 instead of $83. Through the entire process they notified me of everything happening, from getting permits from the city to installers coming out. So far I’m very pleased with their service and the money I’m saving.

Steve Shaw
Virginia, Virginia

Key Takeaways

• Electricity rates in Annapolis keep climbing, jumping about 37% from 2021 to 2024, making home solar an appealing way to gain control over rising energy costs.
• Maryland and Anne Arundel County incentives can lower your cost, including rebates, tax exemptions, net metering, SRECs, and a local solar property tax credit up to $2,500.
• You don’t have to buy solar upfront—with a LightReach lease, Palmetto owns and maintains the system while you start saving from day one.

Annapolis Electricity Prices

If you live in Annapolis, you’ve likely noticed your electricity bills climbing steadily year after year along the Chesapeake.

Maryland residential electricity rates have jumped from 13.1 cents per kWh in 2021 to 17.9 cents per kWh in 2024. That’s roughly a 37% increase in just three years, outpacing the national average.

Many Annapolis homeowners are turning to solar to take more control over these rising costs. With plenty of sunny days near the Bay, home solar panels can generate power right on your own roof.

Over time, solar can offer more predictable energy costs and long-term savings, helping shield your household from future rate hikes. Learn how it works with our guide to home solar panels.

Price of Energy: Maryland vs National Average

0¢
10¢
20¢
30¢
13.7¢
13.1¢
15.0¢
14.5¢
16.0¢
16.6¢
16.5¢
17.9¢
2021
2022
2023
2024
US Average
Maryland

Annapolis Area Utility Providers

In Annapolis, most homeowners get electricity from BGE or SMECO. In 2023, BGE charged about 16.5¢ per kWh and SMECO about 14.1¢ per kWh, shaping monthly bills across the area.

BGE’s 2023 rate ran slightly below Maryland’s 16.6¢ average but above the 16.0¢ national average. SMECO, a member-owned cooperative, came in lower thanks to its nonprofit structure and different service territory along the Chesapeake.

No matter your provider, utility rates can shift over time. Solar lets Annapolis homeowners generate their own power, offering a way to gain more predictability and control over long-term energy costs.

Annapolis Utilities Electricity Rates

| Utility | Rate (cents/kWh) | Change (%) | | | ------ | ----------------| -------- | | | BGE | 16.50 | +3% | | | SMECO | 14.10 | -12% | | | MD Average | 16.60 | +4% | | | US Average | 16.0 | — | |

Maryland Solar Incentives

Annapolis homeowners can tap several solar incentives in Maryland that help offset the cost of installing solar and lower your long-term energy expenses.

These programs include rebates, tax credits, sales and property tax exemptions, net metering, and SRECs. Because Annapolis sits in Anne Arundel County, you may also qualify for the county’s solar property tax credit of up to $2,500.

While the federal 30% residential tax credit has ended, Maryland’s state and local incentives remain. Leasing through LightReach also simplifies things, since Palmetto handles the commercial ITC and passes savings along through lower monthly payments.

Maryland Solar Access Program (MSAP)

The Maryland Solar Access Program (MSAP), established under the Brighter Tomorrow Act of 2024, provides grants of $750 per kilowatt (kW) of installed DC solar capacity, up to a maximum of $7,500. For a typical 6–10 kW residential system, this translates to $4,500–$7,500 in direct grant funding. A total of $2,000,000 is available for FY 2026 through the Strategic Energy Investment Fund (SEIF), awarded on a first-come, first-served basis.

To be eligible, your home must be owner-occupied and used as your primary residence, and your household income must be at or below 150% of the Area Median Income (AMI). Installations must be performed by an MEA-approved contractor from the program’s participating contractor list. The application process is two-step: first submit an initial application to reserve funds, then confirm your system is fully installed and operational within 180 days of fund reservation.

Important status note:

As of April 15, 2026, approximately 99% of MSAP funding has already been reserved. The application window closes on June 5, 2026, or when funds are exhausted — whichever comes first. Prospective applicants in Annapolis should check the MEA website immediately for current availability and watch for the FY 2027 program launch.

Maryland Solar Access Bridge Fund

The Maryland Solar Access Bridge Fund was created in 2026 to address the financial gap left by the early phase-out of the federal Residential Clean Energy Credit (Section 25D). With the federal solar tax credit no longer available for residential systems placed in service in 2026, this state grant approximates the value of that expired credit, helping to keep residential solar financially viable for Annapolis homeowners. Up to $7,800,000 in total funding is anticipated to be available through the Strategic Energy Investment Fund (SEIF).

Only households may apply directly — contractors may not apply on behalf of a household. This ensures the benefit flows directly to the homeowner. Applications are accepted on a first-come, first-served basis, and the deadline is May 31, 2026, or until budgeted funding is exhausted, whichever comes first.

Given the program’s limited funding and high demand for solar incentives in Maryland, homeowners in Annapolis interested in this grant should act quickly and check the Maryland Energy Administration website for the most current application status and eligibility details before applying.

Maryland Residential and Commercial Energy Storage (RCES) Grant Program

Launched in Fiscal Year 2026, the Maryland Residential and Commercial Energy Storage (RCES) Grant Program replaces the now-ended Maryland Energy Storage Income Tax Credit Program. It provides grants to support the installation of grid-connected battery energy storage systems (BESS) for both residential and commercial property owners. Residential applicants can receive the lesser of 30% of installed costs or $5,000, while commercial applicants may receive up to $150,000. A total of $2,000,000 is available for FY 2026 through the Strategic Energy Investment Fund (SEIF).

Eligible applicants include owners of residential or commercial properties installing a qualifying BESS, as well as third-party system owners who finance or own the system on behalf of the property owner. Systems must meet safety standards such as UL certification and must be installed by licensed professionals. The application process is two-step via the MyMEA Portal, and the system must be fully installed within 180 days of the Reservation Certificate effective date.

Important status note:

As of mid-2026, total funding requests have exceeded the full FY 2026 program budget of $2,000,000, and the application portal is currently closed to new applicants. However, the FY 2027 program is anticipated to launch in summer 2026. Homeowners in Annapolis interested in this grant should monitor the MEA website for updates or contact the Energy Storage Team at EnergyStorage.MEA@Maryland.gov.

Maryland Sales Tax Exemption for Solar Equipment

Maryland law exempts solar energy equipment from the state’s 6% sales and use tax. This exemption applies to solar panels, inverters, racking, monitoring systems, and all associated hardware purchased for a residential solar installation. For the average Maryland solar system priced around $33,700, this exemption saves homeowners approximately $2,000–$2,100 right off the top.

One of the best features of this exemption is its simplicity: no application or paperwork is required. The savings are applied automatically at the point of sale by your solar installer or equipment supplier. There is no income limit, no program deadline, and no cap on the system size that qualifies.

This is a permanent, statewide exemption that applies to all Maryland residents purchasing solar equipment, including those in Annapolis, making it one of the most universally accessible solar incentives in the state. It effectively lowers the baseline cost of going solar for every Maryland homeowner, regardless of income or location.

Maryland Property Tax Exemption for Solar Energy Equipment

Under Maryland Tax-Property Article § 7-240, the added value that a solar energy system contributes to your home is fully exempt from state and local property tax assessments. This means that even though solar panels can increase your home’s market value by tens of thousands of dollars, your annual property tax bill will not increase as a result. The exemption covers solar panels, inverters, racking, monitoring systems, and all associated hardware.

This is a mandatory, statewide exemption — it applies in every Maryland county and municipality, including Annapolis, and you do not need to file a separate application to claim it. The exemption is built into state law and is automatically applied by the Maryland Department of Assessments and Taxation. Eligible technologies include solar PV panels, solar water heaters, and solar thermal electric systems.

For a typical Maryland solar installation, this exemption saves homeowners an estimated $160–$240 per year in property taxes, depending on your county’s effective tax rate. Over a 25-year system lifespan, that adds up to $4,000–$6,000 in cumulative savings — making this one of the most valuable long-term solar incentives in the state.

Maryland Net Metering Program

Maryland’s net metering policy requires all major electric utilities — including BGE, Pepco, Potomac Edison, and Delmarva Power — to credit residential solar customers at the full retail rate of electricity for any excess power their system sends to the grid. This true 1-to-1 structure means the value of electricity you export equals the value of electricity you import, effectively allowing your solar panels to completely offset your utility bill. Systems up to 2 MW (or 200% of the owner’s annual baseline usage) are eligible, and the statewide program cap is 3,000 MW of total net-metered capacity.

Excess credits roll over month to month, allowing you to bank surplus generation from sunny summer months and draw on those credits during cloudier winter periods. Maryland also gives you the right to opt out of the annual April true-up and instead choose indefinite rollover — meaning your excess kWh credits stay in your account permanently at full retail value, rather than being cashed out at a lower commodity rate.

Important future change:

The current net metering program is scheduled to end on July 1, 2027, unless the 3,000 MW statewide cap is reached sooner. After that date, the Public Service Commission will implement the successor SUNRISE Program, which will compensate solar owners based on the value distributed solar provides to the grid — likely at a lower rate than the current full retail credit. Homeowners in Annapolis who install solar before the transition may be grandfathered under existing terms; check with the Maryland PSC for the latest details.

Maryland Solar Renewable Energy Certificates (SRECs)

Maryland’s Renewable Portfolio Standard (RPS) requires electric utilities to source a portion of their power from solar energy. To comply, utilities purchase Solar Renewable Energy Certificates (SRECs) from solar system owners. You earn one SREC for every 1,000 kWh (1 MWh) your solar system produces, and those credits can be sold on the open SREC market. Maryland solar owners are credited with SRECs for all energy their system produces for the first 15 years of operation.

Current Maryland SREC prices are trading in the $50–$90 per SREC range. For a typical 10 kW system producing roughly 11,000–13,000 kWh per year, that’s 11–13 SRECs annually — generating approximately $660–$1,170 in additional income per year. Over the 15-year SREC eligibility period, total lifetime SREC value can reach $3,000–$4,000 or more depending on system size and market conditions. To participate, your system must be certified by the state and registered in PJM’s Generation Attribute Tracking System (GATS).

Note that SREC market prices fluctuate based on supply and demand. Maryland’s SREC values have generally declined since 2015 as more solar installations have entered the market. Many homeowners work with an SREC aggregator or broker to simplify the selling process. The Solar Alternative Compliance Payment (SACP) — the ceiling price utilities pay — is set at $55 for 2025 and will decrease gradually through 2030, where it settles at $22.50, which may put downward pressure on future SREC prices.

Anne Arundel County Solar Property Tax Credit

Homeowners in Annapolis, located in Anne Arundel County, may be eligible for a one-time local property tax credit of up to $2,500 for the installation of a qualifying solar energy system. This credit is applied against your county property tax bill and is separate from — and in addition to — the statewide property tax exemption that prevents your assessment from increasing due to solar.

This local credit stacks on top of state-level incentives, providing Annapolis and Anne Arundel County residents with an additional layer of financial benefit when going solar. To apply, contact the Anne Arundel County tax authority directly for current application requirements, eligibility criteria, and any documentation needed to claim the credit.

Local tax credits like this one can vary in availability and terms from year to year based on county budget decisions. We recommend verifying current program status and application deadlines directly with the Anne Arundel County Office of Finance before making installation decisions based on this incentive.

Annapolis Solar Irradiance

Solar panel production varies throughout the year based on daylight hours, weather patterns, and sun intensity. Understanding how seasons affect your solar system helps set realistic expectations for your investment.

Annapolis enjoys four distinct seasons and plenty of sunny days near the Chesapeake Bay. While summer humidity and winter clouds vary production, the right solar system performs reliably here year-round.

Solar Production in Annapolis by Month

System Size: 5 kW 7 kW 10 kW

Daylight Hours
Energy Production (kWh/day)
Source: National Renewable Energy Laboratory (NREL) PVWatts data; Annapolis, MD

What Can Your Solar System Power?

Summer Production (July)

47.9 kWh/day

In July, your 10 kW system could power:

• 3.2 average homes (15 kWh/day per home)
• or Run central AC for 15 hours AND power all other appliances
• or Fully charge 4.8 Tesla Model 3 electric vehicles

Winter Production (December)

25.3 kWh/day

In December, your 10 kW system could power:

• 1.7 average homes (15 kWh/day per home)
• or Keep your home heating system running for 12 hours
• or Fully charge 2.5 Tesla Model 3 electric vehicles

Annual Production

13,956 kWh/year

Over a year, your 10 kW system could:

• Offset 10 tons of carbon dioxide emissions
• or Equal the environmental benefit of planting 167 trees

Solar Panel Systems in Annapolis

We’ve mapped solar installations across the United States, right down to the neighborhood level. Explore this interactive heatmap to see how many homes in Annapolis, MD have already switched to solar. Click any hexagon to discover how your community is embracing clean energy, one rooftop at a time.

Leasing Solar Panels

In Annapolis, Palmetto offers a solar Power Purchase Agreement (PPA) through LightReach. Whether your home is served by BGE, Pepco, Potomac Edison, Delmarva Power, SMECO, or Choptank Electric Cooperative, a PPA is available. Instead of a fixed monthly payment, you simply pay a set price for each kilowatt-hour your panels produce.

Unlike paying cash upfront, a PPA has no large investment to recoup and no maintenance to manage. Palmetto owns the system and handles upkeep, monitoring, and repairs, so you can start saving from day one without the responsibilities of ownership.

Want to compare your options? Learn more about whether to buy or lease solar, or explore how LightReach works for Annapolis homeowners.

Frequently Asked Questions

Does Annapolis, MD have net metering?
Yes, Annapolis, MD has net metering. Maryland requires utilities like BGE and SMECO to credit solar owners at the full retail rate for excess power sent to the grid. These credits roll over month to month, letting you bank summer production for cloudier winter months.

Do solar panels increase your home value in Annapolis, MD?
Yes. In Annapolis, solar panels you own or purchase can increase your home’s value. A national Zillow study found homes with solar sold for about 4.1% more, and Maryland exempts that added value from property taxes.

How much does it cost to go solar in Annapolis, MD?
With a LightReach lease, Annapolis homeowners can go solar for a low fixed monthly payment starting around $124/month with no upfront cost. Palmetto owns and maintains the system, and you start saving from day one.

What’s the best solar company in Annapolis, MD?
At Palmetto, we combine national expertise with a local focus in Annapolis. Since 2020, we’ve completed 2,377 installations across Maryland, helping homeowners near the Chesapeake take control of rising energy costs.

How much electricity can a solar system produce in Annapolis, MD?
In Annapolis, a typical 10 kW home solar system produces roughly 13,900 kWh per year, based on NREL PVWatts data and the area’s average of about 4.9 peak sun hours per day. Smaller systems produce less—around 7,000 kWh for a 5 kW system.

Do solar panels require maintenance in Annapolis, MD?
Solar panels are low maintenance. With no moving parts, they typically need only occasional cleaning, and Annapolis rain often handles that naturally. Panels are built to withstand Chesapeake-area weather year-round.