Electricity prices were going up, environmentalism was in, and solar power companies were proliferating. But last year Maryland residents still didn't take the state up on all the financial incentives it offered for installing "green" power systems in their homes.
This year, however, Maryland residents flooded the state program with applications for grants to build solar and geothermal systems to help defray utility costs. Within a few weeks, more than $590,000 - all of the money available for the fiscal year that began this month - had been doled out.
State officials say the turnaround in demand was prompted by an increase in the grant amounts approved by the General Assembly during the winter session. Lawmakers raised grant amounts for systems that convert sunlight into electricity to as much as $10,000, up from $3,000, and tripled the amount residents could get for geothermal systems, which rely on the Earth's temperature to provide heating and cooling. Those grants are now as much as $3,000.
"In prior years, there wasn't enough of an incentive to enable people to justify the investment," said Malcolm Woolf, director of the Maryland Energy Administration. "When the new grant window opened, we got flooded with applicants in a way that's never happened before."
For the first time in the program's five-year history, there is a waiting list of dozens of residents seeking grants. While new funding will not be appropriated by state lawmakers until the next fiscal year, which begins in July 2009, state officials hope to be able to direct money to the program from the recently enacted Regional Greenhouse Gas Initiative.
Cap and trade
The program establishes a cap-and-trade system in which industrial businesses would buy pollution credits through auctions. State officials estimate that it could generate $140 million a year. About 10 percent of those proceeds could be used to supplement the program, Woolf said. The first auction is scheduled for September.
With federal tax credits and state grants, homeowners could nearly halve the price of the typical solar-panel system, which costs less than $30,000. Such a system could reduce a homeowner's electricity bill by up to a third.
Madeleine Arnheim of Easton said that with the state incentives, it made financial sense for her and her husband to install a solar panel system while renovating their home. The fact that they could reduce their electric bill, which totaled $500 this month, made the idea all the more attractive.
