LAWRENCE J. HOGAN, JR., Governor Ch. 246
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Chapter 246
(Senate Bill 215)
AN ACT concerning
Income Tax – Energy Storage Tax Credit – Alterations and Extension
Energy Storage Systems – Income Tax Credit and Grant Program
FOR the purpose of increasing the total amount of tax credit certificates that the Maryland
Energy Administration may issue in a taxable year for the costs of installing an
energy storage system; authorizing, under certain circumstances, a taxpayer to claim
a refund of the credit; altering the date by which an energy storage system is
required to be installed for purposes of eligibility for the credit; a certain credit
against the State income tax for the costs of installing an energy storage system;
establishing the Energy Storage System Grant Program in the Maryland Energy
Administration to provide grants to certain applicants for the purchase and
installation of energy storage systems; terminating the energy storage tax credit;
establishing the Energy Storage System Grant Fund as a special, nonlapsing fund;
and generally relating to the energy storage tax credit and grant program.
BY repealing and reenacting, without amendments,
Article – Tax – General
Section 10–719(a) and (b)
Annotated Code of Maryland
(2016 Replacement Volume and 2021 Supplement)
BY repealing and reenacting, with amendments,
Article – Tax – General
Section 10–719(d), (f), and (g) 10–719(g)
Annotated Code of Maryland
(2016 Replacement Volume and 2021 Supplement)
BY adding to
Article – State Government
Section 9–2010
Annotated Code of Maryland
(2021 Replacement Volume)
BY repealing
Article – Tax – General
Section 10–719
Annotated Code of Maryland
(2016 Replacement Volume and 2021 Supplement)
(As enacted by Section 1 of this Act)
Ch. 246 2022 LAWS OF MARYLAND
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SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
That the Laws of Maryland read as follows:
Article – Tax – General
10–719.
(a) (1) In this section the following words have the meanings indicated.
(2) “Administration” means the Maryland Energy Administration.
(3) “Energy storage system” means a system used to store electrical energy,
or mechanical, chemical, or thermal energy that was once electrical energy, for use as
electrical energy at a later date or in a process that offsets electricity use at peak times.
(4) “Taxpayer” means:
(i) the owner of a residential property who purchases and installs
an energy storage system on the residential property;
(ii) the owner of a commercial property who purchases and installs
an energy storage system on the commercial property; or
(iii) an individual or a corporation that owns or pays for the
installation of an energy storage system that supplies electrical energy intended for use on
the residential or commercial property on which the energy storage system is installed.
(b) Subject to the limitations of this section, a taxpayer that receives a tax credit
certificate may claim a credit against the State income tax for the total installed costs of an
energy storage system installed on residential or commercial property during the taxable
year.
(d) The Administration may not issue an aggregate amount of tax credit
certificates exceeding [$750,000] $1,000,000 for a taxable year.
(f) (1) (I) [The] EXCEPT AS PROVIDED IN PARAGRAPH (2) OF THIS
SUBSECTION AND SUBJE CT TO SUBPARAGRAPH (II) OF THIS PARAGRAPH , THE total
amount of the credit allowed under this section for any taxable year may not exceed the
State income tax for that taxable year, calculated before the application of the credits under
this section and §§ 10–701 and 10–701.1 of this subtitle, but after the application of other
credits allowable under this subtitle.
[(2)] (II) The unused amount of credit for any taxable year may not be
carried over to any other taxable year.
LAWRENCE J. HOGAN, JR., Governor Ch. 246
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(2) (I) THIS PARAGRAPH APPLIE S ONLY TO A TAXPAYER WHO IS AN
INDIVIDUAL WHO OWNS AND PAYS FOR THE INS TALLATION OF AN ENER GY STORAGE
SYSTEM THAT SUPPLIES ELECTRICAL ENERGY IN TENDED FOR USE ON TH E PRIMARY
RESIDENCE OF THE TAX PAYER.
(II) FOR ANY TAXABLE YEAR BEGINNING AFTER DECEMBER 31,
2022, IF THE TAX CREDIT AL LOWED UNDER THIS SEC TION EXCEEDS THE TOT AL TAX
OTHERWISE PAYABLE BY THE TAXPAYER FOR THA T TAXABLE YEAR , THE TAXPAYER
MAY CLAIM A REFUND I N THE AMOUNT OF THE EXCESS .
(g) The credit under this section may not be claimed for an energy storage system
installed before January 1, 2018, or after December 31, [2022] 2024.
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July
1, 2022, and shall be applicable to all taxable years beginning after December 31, 2021.
SECTION 2. AND BE IT FURTHER ENACTED, That the Laws of Maryland read
as follows:
Article – State Government
9–2010.
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS
INDICATED.
(2) “ELIGIBLE APPLICANT ” MEANS:
(I) THE OWNER OF A RESID ENTIAL PROPERTY WHO PURCHASES
AND INSTALLS AN ENER GY STORAGE SYSTEM ON THE RESIDENTIAL PROPERTY;
(II) THE OWNER OF A COMME RCIAL PROPERTY WHO P URCHASES
AND INSTALLS AN ENER GY STORAGE SYSTEM ON THE COMMERCIAL PROPE RTY; OR
(III) AN INDIVIDUAL OR A B USINESS ENTITY THAT OWNS OR PAYS
FOR THE INSTALLATION OF AN ENERGY STORAGE SYSTEM THAT SU PPLIES
ELECTRICAL ENERGY IN TENDED FOR USE ON TH E RESIDENTIAL OR COM MERCIAL
PROPERTY ON WHICH TH E ENERGY STORAGE SYS TEM IS INSTALLED .
(3) “ENERGY STORAGE SYSTEM ” MEANS A SYSTEM USED TO STORE
ELECTRICAL ENERGY , OR MECHANICAL , CHEMICAL, OR THERMAL ENERGY TH AT WAS
ONCE ELECTRICAL ENER GY, FOR USE AS ELECTRICA L ENERGY AT A LATER DATE OR
IN A PROCESS THAT OF FSETS ELECTRICITY US E AT PEAK TIMES.
Ch. 246 2022 LAWS OF MARYLAND
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(4) “FUND” MEANS THE ENERGY STORAGE SYSTEM GRANT FUND.
(5) “PROGRAM” MEANS THE ENERGY STORAGE SYSTEM GRANT
PROGRAM.
(B) THERE IS AN ENERGY STORAGE SYSTEM GRANT PROGRAM IN THE
ADMINISTRATION .
(C) THE PURPOSE OF THE PROGRAM IS TO PROVIDE GRANTS TO
INDIVIDUALS AND BUSI NESS ENTITIES FOR A PORTI ON OF THE COSTS OF
PURCHASING AND INSTA LLING ENERGY STORAGE SYSTEMS.
(D) THE ADMINISTRATION SHALL :
(1) ADMINISTER THE PROGRAM;
(2) ESTABLISH APPLICATIO N PROCEDURES FOR THE PROGRAM; AND
(3) AWARD GRANTS UNDER T HE PROGRAM.
(E) SUBJECT TO THE AVAILA BILITY OF MONEY IN T HE FUND, AN ELIGIBLE
APPLICANT MAY APPLY FOR A GRANT UNDER TH E PROGRAM FOR COSTS INC URRED
TO PURCHASE AND INST ALL AN ENERGY STORAG E SYSTEM.
(F) A GRANT AWARDED UNDER THE PROGRAM MAY NOT EXCEE D THE
LESSER OF:
(1) (I) FOR AN ENERGY STORAG E SYSTEM INSTALLED O N A
RESIDENTIAL PROPERTY , $5,000; OR
(II) FOR AN ENERGY STORAG E SYSTEM INSTALLED O N A
COMMERCIAL PROPERTY , $150,000; OR
(2) 30% OF THE TOTAL INSTALL ED COSTS OF THE ENER GY STORAGE
SYSTEM.
(G) THE ADMINISTRATION SHALL A PPROVE ALL APPLICATI ONS THAT
QUALIFY FOR A GRANT UNDER THE PROGRAM:
(1) ON A FIRST–COME, FIRST–SERVED BASIS; AND
(2) IN A TIMELY MANNER .
LAWRENCE J. HOGAN, JR., Governor Ch. 246
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(H) A GRANT UNDER THIS SEC TION MAY NOT BE AWAR DED FOR AN ENERGY
STORAGE SYSTEM INSTA LLED BEFORE JANUARY 1, 2025.
(I) (1) THERE IS AN ENERGY STORAGE SYSTEM GRANT FUND.
(2) THE ADMINISTRATION SHALL ADMINISTER THE FUND.
(3) (I) THE FUND IS A SPECIAL, NONLAPSING FUND THAT IS NOT
SUBJECT TO § 7–302 OF THE STATE FINANCE AND PROCUREMENT ARTICLE.
(II) THE STATE TREASURER SHALL HOLD THE FUND
SEPARATELY, AND THE COMPTROLLER SHALL ACC OUNT FOR THE FUND.
(4) THE FUND CONSISTS OF :
(I) MONEY APPROPRIATED I N THE STATE BUDGET TO THE
FUND; AND
(II) ANY OTHER MONEY FROM ANY OTHER SOURC E ACCEPTED
FOR THE BENEFIT OF T HE FUND.
(5) THE FUND MAY BE USED ONLY FOR:
(I) PROVIDING GRANTS UND ER THE PROGRAM TO ELIGIBLE
APPLICANTS; AND
(II) ADMINISTRATIVE COSTS OF THE PROGRAM.
(6) (I) THE STATE TREASURER SHALL INVES T THE MONEY OF THE
FUND IN THE SAME MANN ER AS OTHER STATE MONEY MAY BE IN VESTED.
(II) ANY INTEREST EARNINGS OF THE FUND SHALL BE
CREDITED TO THE GENERAL FUND OF THE STATE.
(J) THE ADMINISTRATION MAY AD OPT REGULATIONS TO C ARRY OUT THIS
SECTION.
SECTION 3. AND BE IT FURTHER ENACTED, That the Laws of Maryland read
as follows:
Article – Tax – General
[10–719.
Ch. 246 2022 LAWS OF MARYLAND
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(a) (1) In this section the following words have the meanings indicated.
(2) “Administration” means the Maryland Energy Administration.
(3) “Energy storage system” means a system used to store electrical energy,
or mechanical, chemical, or thermal energy that was once electrical energy, for use as
electrical energy at a later date or in a process that offsets electricity use at peak times.
(4) “Taxpayer” means:
(i) the owner of a residential property who purchases and installs an
energy storage system on the residential property;
(ii) the owner of a commercial property who purchases and installs
an energy storage system on the commercial property; or
(iii) an individual or a corporation that owns or pays for the
installation of an energy storage system that supplies electrical energy intended for use on
the residential or commercial property on which the energy storage system is installed.
(b) Subject to the limitations of this section, a taxpayer that receives a tax credit
certificate may claim a credit against the State income tax for the total installed costs of an
energy storage system installed on residential or commercial property during the taxable
year.
(c) On application by a taxpayer, the Administration shall issue a tax credit
certificate that may not exceed the lesser of:
(1) (i) for an energy storage system installed on a residential property,
$5,000; or
(ii) for an energy storage system installed on a commercial property,
$150,000; or
(2) 30% of the total installed costs of the energy storage system.
(d) The Administration may not issue an aggregate amount of tax credit
certificates exceeding $750,000 for a taxable year.
(e) The Administration shall approve all applications that qualify for a tax credit
certificate:
(1) on a first–come, first–served basis; and
(2) in a timely manner.
LAWRENCE J. HOGAN, JR., Governor Ch. 246
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(f) (1) The total amount of the credit allowed under this section for any taxable
year may not exceed the State income tax for that taxable year, calculated before the
application of the credits under this section and §§ 10–701 and 10–701.1 of this subtitle, but
after the application of other credits allowable under this subtitle.
(2) The unused amount of credit for any taxable year may not be carried
over to any other taxable year.
(g) The credit under this section may not be claimed for an energy storage system
installed before January 1, 2018, or after December 31, 2024.
(h) On or before January 31 each taxable year, the Administration shall report to
the Comptroller on the tax credit certificates issued under this section during the prior
taxable year.
(i) The Administration, in consultation with the Comptroller, shall adopt
regulations to carry out this section.]
SECTION 4. AND BE IT FURTHER ENACTED, That:
(a) Section 1 of this Act shall be applicable to taxable years beginning after
December 31, 2021, but before January 1, 2025.
(b) Section 3 of this Act shall be applicable to taxable years beginning after
December 31, 2024.
SECTION 5. AND BE IT FURTHER ENACTED, That Section 2 of this Act shall take
effect July 1, 2024.
SECTION 6. AND BE IT FURTHER ENACTED, That Section 3 of this Act shall take
effect July 1, 2025.
SECTION 7. AND BE IT FURTHER ENACTED, That, except as provided in Sections
5 and 6 of this Act, this Act shall take effect July 1, 2022.
Approved by the Governor, May 12, 2022.