Energy Incentive Programs, Maryland

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Updated October 2015

Maryland utilities budgeted over $290 million in 2014 across their various electric and gas programs (including those directed at residential and low-income customers) to promote customer energy efficiency.

What public-purpose-funded energy efficiency programs are available in my state?

Maryland's electricity restructuring law, signed in 1999, mandated the creation of a Universal Service Fund that provides bill assistance and weatherization for low-income customers. Currently, no public-purpose-funded energy efficiency programs are available to federal customers.

What utility energy efficiency programs are available to me?

The EmPOWER Maryland program, created in 2008, requires utilities to develop energy-saving programs to decrease electricity consumption.

BGE's Smart Energy Savers Program offers a variety of financial incentives and technical services:

  • Incentives are available through the Energy Solutions for Business program for lighting, HVAC systems, variable frequency drives (VFDs), commercial refrigeration and kitchen equipment for both new construction/renovation and retrofit projects. Incentives cover up to 50% of the total cost of retrofit projects and 75% of the incremental cost of new construction measures. A custom incentive program is also offered.

  • Small business customers (those with an average peak demand of 60 kW or less) can participate in the Small Business Energy Solutions program, in which participants receive a free energy audit that will provide a series of recommendations for improvements to lighting, HVAC, refrigeration, and electric hot water systems, all of which have generous (up to 80%) rebates. The customer can then choose to have some or all of these installed by the BGE-certified contractor; all measures carry warranties.

  • A Building Tune-Up of existing buildings is supported, with BGE providing up to 75% of the cost (maximum $30,000 per project for facilities over 75,000 sq. ft. and $15,000 for those under that threshold). BGE predicts 5-15% total energy savings from participation in the program.

PEPCO and Delmarva Power now offer a variety of efficiency programs to commercial and industrial (C&I) customers in Maryland:

  • Energy Savings Solutions for Existing Buildings (Delmarva customers click here) are available for a broad array of commercial and industrial energy-using products and applications, ranging from commercial-scale water heaters to chillers. Custom project incentives (e.g., for building automation upgrades) cover up to 50% of project cost (capped at $0.28/kWh and 1.5-year payback). PEPCO also offers support for retro- and monitoring-based commissioning, HVAC equipment and even O&M training. Pre-approval is required for most projects.

  • New Construction and Major Renovation (Delmarva customers click here) projects are eligible for a range of incentives, including standard prescriptive rebates for efficient products, comprehensive design support, and subsidies for enhanced commissioning. Free technical assistance is provided to building projects of less than 50,000 sq. ft. Once construction is complete, there are also incentives for operator and occupant training.

  • A Full Retro-Commissioning for Existing Buildings (Delmarva customers click here) program provides up to $30,000 (or 50% of cost) for a four-phase retro-commissioning (RCx) process for buildings that are at least two years old, 75,000 sq ft., and have a higher-than-average electrical intensity in Energy Star Portfolio Manager. A commitment to spend at least $15,000 on retro-commissioning follow-up is also required. An approved RCx Trade Ally will assess the building and work with the building manager to implement the RCx plan. Buildings that have already started a RCx project may still be eligible for incentives from PEPCO.

  • The Small Business Program (Delmarva customers click here), aimed at business with an average peak load of less than 60 kW, starts with a Quick Energy Check Up from a trade ally. Following this, the trade ally will install up to $250 in low-cost measures. As long as the customer agrees to install up to three additional no- to low-cost measures recommended from the check-up, they become eligible for substantial incentives toward more costly measures.

Customers intending to take advantage of these incentives should be aware that most require pre-approval to obtain the utility rebate.

Potomac Edison (a subsidiary of First Energy) offers a an array of incentives as part of its For Your Business initiative, covering lighting, HVAC, water heating, and food service/commercial kitchen equipment. The utility also offers a Specialty Programs option, in which custom equipment and whole-building projects are incentivized at up to 50% of their cost (75% of incremental cost for new construction).

The Southern Maryland Electric Cooperative offers a set of prescriptive rebates for lighting, unitary HVAC, VFDs, and commercial refrigeration equipment, as well as custom incentives for more complex energy efficiency projects. Both kinds of rebates typically cover up to 50% of total cost for retrofits and 75% of the incremental cost for new construction. To participate, contact a SMECO Trade Ally.

What load management/demand response options are available to me?

The PJM Interconnection (PJM), a regional transmission organization (RTO), offers several demand response programs. Two specific programs may be attractive to federal facilities in the PJM footprint:

  • PJM's emergency "capacity" program allows demand resources to participate in PJM's Reliability Pricing Model (RPM) forward capacity market via a curtailment service provider (any existing PJM member, such as their utility, a third-party electricity supplier, or a specialty CSP). Participants pledge to either reduce their load by a specified amount (guaranteed load drop, GLD), or to a specific kW level (known as firm service level, FSL), within one or two hours of an event notification. Load reductions are mandatory and may occur up to ten times per year, lasting up to six hours per event. Penalties for non-compliance are substantial. Remuneration is based on the results of the annual RPM capacity auctions in various PJM regions. Remuneration levels for the 2016-17 PJM year (which begins June 1, 2016) are in the $80,000 per MW range for Maryland customers. Participants are also eligible to receive energy payments for actual reductions, if and when the program is called.

  • The Economic Load Response program allows electricity users to provide load reductions in exchange for a payment based on hourly wholesale electricity prices. Participation is fully voluntary. Customers start by submitting load reduction bids (through their CSP) of at least 100 kW into the day-ahead energy market. Participants whose bids are accepted are paid for their load reductions based upon the day-ahead, hourly electricity market prices (the day-ahead "locational marginal price," or LMP). Reductions are figured based on a customer baseline load (CBL), which is essentially the average loads for the same hours in four of the facility's previous non-responding days. Regardless of which type of firm it is, the CSP will generally offer to split the revenues with the customer at a pre-determined percentage.

In both programs, participants can provide load reductions either through curtailing electricity use or by operating on-site generation consistent with local environmental regulations and permits.

Potomac Edison offers the Economic Generation Buy-Back Rider, which pays customers to voluntarily run onsite generation (3 MW minimum) for two or more hours during periods of high wholesale electricity prices. Payment is based on the difference between the average of the six 30-minute integrated demands preceding the curtailment period and the maximum 30-minute integrated demand during the customer's participation.

BGE's Hourly-Priced Service is a real-time pricing program whereby customers pay BGE PJM's locational marginal price plus fixed adders for distribution, administration, etc. This rate is mandatory for customers over 600 kW who do not contract with a competitive electricity supplier.

What distributed energy resource options are available to me?

The Database of State Incentives for Renewables and Efficiency (DSIRE) provides information on programs that offer incentives for renewable distributed generation. The following programs may be of interest to federal customers:

  • The Maryland Energy Administration offers the Commercial Clean Energy Grant Program, which provides financial incentives for solar PV and water heating. Grant amounts are based on system size or total cost, depending on the technology; they are capped at $6,000 for solar PV and $5,000 for solar water heating.

  • The MEA also offers the Geothermal Heat Pump Grant Program, through which non-residential participants can receive incentives of up to $4,500 for the installation of up to 50 tons of ground-source heat pumps. Equipment must have an EER of 14.0 or higher and COP above 3.0.

  • Maryland's renewable portfolio standard (RPS) places requirements on electricity suppliers to provide a portion of their sold electricity from renewable resources, including a set-aside for solar. Maryland solar renewable energy credits (SRECs) traded in the 18¢/kWh range in September, 2015.

Are there energy efficiency programs sponsored by state government?

In 2008, Maryland passed legislation, creating the EmPOWER Maryland initiative and the Strategic Energy Investment Fund, which substantially increased funding for energy efficiency and renewable energy investment in Maryland. For information on these expanding opportunities, check with the Maryland Energy Administration (MEA).

What additional opportunities are available to me?

Federal customers whose utilities have area-wide supply contracts through GSA (e.g., AGL Resources, BGE, Delmarva Power & Light, PEPCO, Allegheny Power, Trigen Baltimore Energy, and Washington Gas Light), may be able to take advantage of 3rd-party financed energy efficiency projects called utility energy services contracts (UESCs). Information is available in GSA's Energy Division Library. Federal facilities should contact their account executive to determine the level of each utility's participation. Federal facilities should contact their account executive to determine the level of each utility's participation.

PJM (see above in the demand response section) now allows energy efficiency projects to participate in its forward capacity markets, based on its Reliability Pricing Model (RPM). To be eligible, energy efficiency projects must reduce load continuously by at least 100 kW during peak summer hours. This load reduction can be bid into PJM's annual (for three years in advance) and "residual" (nearer-term) capacity auctions, and if selected will receive the auction clearing prices. EE reductions are eligible for four years' worth of participation. Interested customers can participate through energy service companies conducting ESPCs or utilities executing UESCs at their sites.