EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb1435*
HOUSE BILL 1435
C5, M5, Q1 4lr3255
CF SB 783
By: Delegates Fraser–Hidalgo, Bhandari, Embry, Forbes, Jackson, A. Johnson, Qi,
Stein, and Ziegler
Introduced and read first time: February 9, 2024
Assigned to: Economic Matters
A BILL ENTITLED
AN ACT concerning 1
Renewable Energy – Net Energy Metering Aggregation, Solar Renewable 2
Energy Credits, and Taxes on Solar Energy Generating Systems 3
(Brighter Tomorrow Act) 4
FOR the purpose of altering the maximum generating capacity authorized for certain net 5
metered generating facilities; authorizing an eligible customer –generator 6
participating in certain meter aggregation to receive excess generation from more 7
than one generating system; requiring the Public Service Commission to establish a 8
Small Solar Energy Generating System Incentive Program to provide certain 9
certified systems with a certain additional percentage of renewable energy credits 10
toward meeting the renewable energy portfolio standard for solar energy; providing 11
that a certified system is eligible to receive an additional percentage of renewable 12
energy credits for the life cycle of the system; increasing the duration of a certain 13
renewable energy credit under certain circumstances; requiring that certain 14
prevailing wage provisions apply to the construction of a certain certified system 15
unless the system is subject to a certain project labor agreement; extending for a 16
certain number of years a certain personal property tax exemption for certain 17
community solar energy generating system projects; exempting certain 18
nonresidential solar generating systems from the State or local real or personal 19
property tax; authorizing a county or municipal corporation to reduce or eliminate 20
an assessment on certain real property on which a certain solar energy generating 21
system is located; requiring a county to enter into a certain payment in lieu of taxes 22
agreement with an owner of a certain ground–mounted solar generating facility 23
under certain circumstances; and generally relating to renewable energy facilities 24
and tax provisions for renewable energy facilities. 25
BY repealing and reenacting, with amendments, 26
Article – Public Utilities 27
Section 7–306(g) and (i), 7–709(d), and 7–712 28
Annotated Code of Maryland 29 2 HOUSE BILL 1435
(2020 Replacement Volume and 2023 Supplement) 1
BY adding to 2
Article – Public Utilities 3
Section 7–306(i) and 7–709.1 4
Annotated Code of Maryland 5
(2020 Replacement Volume and 2023 Supplement) 6
BY repealing and reenacting, without amendments, 7
Article – Tax – Property 8
Section 1–101(j) 9
Annotated Code of Maryland 10
(2019 Replacement Volume and 2023 Supplement) 11
BY repealing and reenacting, with amendments, 12
Article – Tax – Property 13
Section 7–237(c) 14
Annotated Code of Maryland 15
(2019 Replacement Volume and 2023 Supplement) 16
BY adding to 17
Article – Tax – Property 18
Section 7–249, 7–250, and 7–522 19
Annotated Code of Maryland 20
(2019 Replacement Volume and 2023 Supplement) 21
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 22
That the Laws of Maryland read as follows: 23
Article – Public Utilities 24
7–306. 25
(g) (1) Except as provided in paragraphs [(6) and (7)] (6), (7), AND (8) of this 26
subsection, the generating capacity of an electric generating system used by an eligible 27
customer–generator for net metering may not exceed 2 megawatts. 28
(2) An electric generating system used by an eligible customer–generator 29
for net metering shall meet all applicable safety and performance standards established by 30
the National Electrical Code, the Institute of Electrical and Electronics Engineers, and 31
Underwriters Laboratories. 32
(3) The Commission may adopt by regulation additional control and testing 33
requirements for eligible customer–generators that the Commission determines are 34
necessary to protect public safety and system reliability. 35
HOUSE BILL 1435 3
(4) An electric company may not require an eligible customer–generator 1
whose electric generating system meets the standards of paragraphs (2) and (3) of this 2
subsection to: 3
(i) install additional controls; 4
(ii) perform or pay for additional tests; or 5
(iii) purchase additional liability insurance. 6
(5) An eligible customer–generator or the eligible customer–generator’s 7
assignee shall own and have title to all renewable energy attributes or renewable energy 8
credits associated with any electricity produced by its electric generating system. 9
(6) The Commission may not prohibit the construction or operation of 10
multiple net metered solar energy generating facilities located on separate contiguous lots 11
that are owned by a local government solely because the capacity of the combined net 12
metering systems exceeds the limit established under paragraph (1) of this subsection, if: 13
(i) the net metered solar energy generating facilities are intended to 14
be used solely for the benefit of the local government; 15
(ii) the total capacity of the net metered solar energy generating 16
facilities on the contiguous lots does not exceed 5 megawatts; 17
(iii) the contiguous lots were not subdivided for the purpose of 18
circumventing the limit established under paragraph (1) of this subsection; and 19
(iv) the utility serving the net metered solar energy generating 20
facilities is not an electric cooperative or municipal electric utility. 21
(7) The generating capacity of a community solar energy generating system 22
established under § 7–306.2 of this subtitle that is used for net metering may not exceed 5 23
megawatts. 24
(8) THE GENERATING CAPACI TY OF A NET METERED FACILIT Y THAT 25
IS METER AGGREGATED UND ER § 7–306.3 OF THIS SUBTITLE MAY NOT EXCEED 5 26
MEGAWATTS . 27
(I) NOTWITHSTANDING THE G ENERATING CAPACITY L IMITS ESTABLISHED 28
IN SUBSECTION (G) OF THIS SECTION , AN ELIGIBLE CUSTOMER –GENERATOR 29
PARTICIPATING IN MET ER AGGREGATION UNDER § 7–306.2 OR § 7–306.3 OF THIS 30
SUBTITLE MAY RECEIVE EXCESS GENERATION FR OM MORE THAN ONE GEN ERATING 31
SYSTEM INCLUDING IF THE COM BINED GENERATING CAP ACITY OF ALL NET 32
METERED FACILITIES T HAT ARE METER AGGREGATED EXCEEDS 5 MEGAWATTS . 33
4 HOUSE BILL 1435
[(i)] (J) On or before November 1 of each year, the Commission shall report to 1
the General Assembly, in accordance with § 2–1257 of the State Government Article, on the 2
status of the net metering program under this section, including: 3
(1) the amount of capacity of electric generating facilities owned and 4
operated by eligible customer–generators in the State by type of energy resource; 5
(2) based on the need to encourage a diversification of the State’s energy 6
resource mix to ensure reliability, whether the rated generating capacity limit in subsection 7
(d) of this section should be altered; and 8
(3) other pertinent information. 9
7–709. 10
(d) (1) Except as PROVIDED IN § 7–709.1 OF THIS SUBTITLE AND 11
authorized under paragraph (2) of this subsection, a renewable energy credit shall exist for 12
3 years from the date created. 13
(2) A renewable energy credit may be diminished or extinguished before 14
the expiration of 3 years by: 15
(i) the electricity supplier that received the credit; 16
(ii) a nonaffiliated entity of the electricity supplier: 17
1. that purchased the credit from the electricity supplier 18
receiving the credit; or 19
2. to whom the electricity supplier otherwise transferred the 20
credit; or 21
(iii) demonstrated noncompliance by the generating facility with the 22
requirements of § 7–704(f) of this subtitle. 23
7–709.1. 24
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 25
INDICATED. 26
(2) “CERTIFIED SYSTEM ” MEANS A SOLAR ENERGY GENERATING 27
SYSTEM CERTIFIED BY THE COMMISSION AS ELIGIBL E TO RECEIVE ADDITIO NAL 28
CREDITS UNDER THE PROGRAM. 29
(3) “PROGRAM” MEANS THE SMALL SOLAR ENERGY GENERATING 30
SYSTEM INCENTIVE PROGRAM. 31 HOUSE BILL 1435 5
(B) THE COMMISSION SHALL ESTA BLISH A SMALL SOLAR ENERGY 1
GENERATING SYSTEM INCENTIVE PROGRAM. 2
(C) UNDER THE PROGRAM, SOLAR ENERGY GENERAT ING SYSTEMS THAT 3
ARE CERTIFIED BY THE COMMISSION IN ACCORDA NCE WITH THIS SECTIO N SHALL 4
BE ELIGIBLE TO RECEI VE ADDITIONAL SOLAR RENEWABLE ENERGY CRE DITS AS 5
PROVIDED IN THIS SEC TION. 6
(D) TO BE ELIGIBLE FOR CE RTIFICATION UNDER TH E PROGRAM, A SOLAR 7
ENERGY GENERATING SYSTEM SHALL : 8
(1) BE LOCATED IN THE STATE; 9
(2) BE ELIGIBLE FOR INCL USION IN MEETING THE RENEWABLE 10
ENERGY PORTFOLIO STA NDARD; 11
(3) HAVE A GENERATING CA PACITY OF 2 MEGAWATTS OR LESS , AS 12
MEASURED BY THE ALTE RNATING CURRENT RATI NG OF THE SYSTEM ’S INVERTER; 13
AND 14
(4) BE PLACED IN SERVICE BETWEEN JULY 1, 2024, AND JANUARY 1, 15
2028, INCLUSIVE. 16
(E) THE TOTAL AMOUNT OF I N–STATE GENERATING CAPA CITY FOR 17
CERTIFIED SYSTEMS , AS MEASURED BY THE A LTERNATING CURRENT R ATING OF 18
THE SYSTEMS’ INVERTERS UNDER THE PROGRAM MAY NOT EXCEE D: 19
(1) 330 MEGAWATTS FOR SYSTEM S WITH A GENERATING CAPACITY OF 20
LESS THAN 20 KILOWATTS, AS MEASURED BY THE A LTERNATING CURRENT RATING 21
OF THE SYSTEM ’S INVERTER; AND 22
(2) 300 MEGAWATTS FOR SYSTEM S WITH A GENERATING CAPACITY OF 23
BETWEEN 20 KILOWATTS AND 2 MEGAWATTS , AS MEASURED BY THE A LTERNATING 24
CURRENT RATING OF TH E SYSTEM’S INVERTER. 25
(F) (1) THE OWNER OF A SOLAR ENERGY GENERATING SY STEM MAY 26
APPLY TO THE COMMISSION TO BE CERT IFIED UNDER THE PROGRAM. 27
(2) THE OWNER OF A CERTIFIED SYSTEM SHA LL PAY A ONE–TIME FEE 28
OF $100 TO THE COMMISSION AT THE TIM E OF THE CERTIFICATI ON. 29
6 HOUSE BILL 1435
(3) THE COMMISSION SHALL USE THE FEES COLLECTED U NDER 1
PARAGRAPH (2) OF THIS SUBSECTION T O PAY FOR COSTS ASSO CIATED WITH 2
ADMINISTERING THE PROGRAM. 3
(G) (1) A CERTIFIED SYSTEM UND ER THE PROGRAM SHALL RECEIVE : 4
(I) FOR SYSTEMS WITH A G ENERATING CAPACITY O F UP TO 2 5
MEGAWATTS , AS MEASURED BY THE A LTERNATING CURRENT R ATING OF THE 6
SYSTEM’S INVERTER, 150% CREDIT TOWARD MEETIN G THE RENEWABLE ENER GY 7
PORTFOLIO STANDARD FOR ENERGY DERIVED FROM SOLAR ; AND 8
(II) FOR SYSTEMS WITH A G ENERATING CAPACITY O F UP TO 2 9
MEGAWATTS , AS MEASURED BY THE A LTERNATING CURRENT R ATING OF THE 10
SYSTEM’S INVERTER, THAT ARE LOCATED ON A ROOFTOP, A PARKING CANOPY , OR A 11
BROWNFIELD , 200% CREDIT TOWARD MEETIN G THE RENEWABLE ENER GY 12
PORTFOLIO STANDARD F OR ENERGY DERIVED FR OM SOLAR. 13
(2) A CERTIFIED SYSTEM IS ELIGIBLE TO RECEIVE THE PERCENTAGE 14
CREDIT SPECIFIED IN PARAGRAPH (1) OF THIS SUBSECTION F OR THE ENTIRE 15
LIFE CYCLE OF THE SY STEM. 16
(H) NOTWITHSTANDING § 7–709(D)(1) OF THIS SUBTITLE , A CREDIT 17
CREATED BY A CERTIFI ED SYSTEM UNDER THE PROGRAM SHALL EXIST F OR 5 YEARS 18
FROM THE DATE CREATE D. 19
(I) THE DEVELOPER OF A CE RTIFIED SYSTEM UNDER TH E PROGRAM THAT 20
HAS A GENERATING CAP ACITY OVER 1 MEGAWATT , AS MEASURED BY THE 21
ALTERNATING CURRENT RATING OF THE SYSTEM ’S INVERTER, SHALL ENSURE THAT 22
WORKERS ARE PAID NOT LESS THAN THE PREVAI LING WAGE RATE DETER MINED 23
UNDER TITLE 17, SUBTITLE 2 OF THE STATE FINANCE AND PROCUREMENT 24
ARTICLE, UNLESS THE SYSTEM IS SUBJECT TO A PROJECT LABOR AGREEMENT 25
THAT: 26
(1) BINDS ALL CONTRACTOR S AND SUBCONTRACTORS ON THE 27
SYSTEM THROUGH THE I NCLUSION OF SPECIFIC ATIONS IN ALL RELEVA NT 28
SOLICITATION PROVISI ONS AND CONTRACT DOCUM ENTS; 29
(2) ALLOWS ALL CONTRACTO RS AND SUBCONTRACTOR S TO COMPETE 30
FOR CONTRACTS AND SU BCONTRACTS ON THE PR OJECT WITHOUT REGARD TO 31
WHETHER THEY ARE OTH ERWISE PARTIES TO CO LLECTIVE BARGAINING 32
AGREEMENTS ; 33
HOUSE BILL 1435 7
(3) ESTABLISHES UNIFORM TERMS AND CONDITIONS OF 1
EMPLOYMENT FOR ALL C ONSTRUCTION LABOR EM PLOYED ON THE PROJEC TS; 2
(4) GUARANTEES AGAINST S TRIKES, LOCKOUTS, AND SIMILAR JOB 3
DISRUPTIONS; 4
(5) ESTABLISHES MUTUALLY BINDING PROCEDURES F OR RESOLVING 5
LABOR DISPUTES ; AND 6
(6) INCLUDES ANY OTHER PROVISIONS NEGOTIATED BY THE PA RTIES 7
TO PROMOTE SUCCESSFU L DELIVERY OF THE SY STEM. 8
7–712. 9
Subject to § 2–1257 of the State Government Article, on or before December 1 of each 10
year the Commission shall report to the General Assembly on the status of implementation 11
of this subtitle, including: 12
(1) the availability of Tier 1 renewable sources[,]; 13
(2) projects supported by the Fund[,]; 14
(3) INFORMATION REGARDIN G THE STATUS OF THE SMALL SOLAR 15
ENERGY GENERATING SYSTEM INCENTIVE PROGRAM ESTABLISHED U NDER § 16
7–709.1 OF THIS SUBTITLE , INCLUDING THE TOTAL AMOUNT OF GENERATING 17
CAPACITY OF THE SYST EMS CERTIFIED UNDER THE PROGRAM; and 18
(4) other pertinent information. 19
SECTION 2. AND BE IT FURTHER ENACTED, That the Laws of Maryland read 20
as follows: 21
Article – Tax – Property 22
1–101. 23
(j) (1) “Department” means the State Department of Assessments and 24
Taxation. 25
(2) “Department” includes, unless the context requires otherwise, a 26
supervisor. 27
7–237. 28
8 HOUSE BILL 1435
(c) (1) (i) In this subsection the following words have the meanings 1
indicated. 2
(ii) “Agrivoltaics” means the simultaneous use of areas of land for 3
both solar power generation and agriculture. 4
(iii) “Brownfield” means: 5
1. a former industrial or commercial site identified by federal 6
or State laws or regulations as contaminated or polluted; or 7
2. a closed municipal or rubble landfill regulated under a 8
refuse disposal permit by the Department of the Environment. 9
(iv) “Community solar energy generating system” has the meaning 10
stated in § 7–306.2 of the Public Utilities Article. 11
(v) “Electric company” has the meaning stated in § 1–101 of the 12
Public Utilities Article. 13
(2) This subsection applies through the life cycle of a community solar 14
energy generating system that: 15
(i) is placed in service after June 30, 2022; and 16
(ii) has been approved on or before December 31, [2025] 2030, by 17
the Public Service Commission under § 7–306.2 of the Public Utilities Article. 18
(3) Personal property is exempt from county or municipal corporation 19
property tax if the property is machinery or equipment that is part of a community solar 20
energy generating system that: 21
(i) has a generating capacity that does not exceed 2 megawatts as 22
measured by the alternating current rating of the system’s inverter; 23
(ii) provides at least 50% of the energy it produces to low– or 24
moderate–income customers at a cost that is at least 20% less than the amount charged by 25
the electric company that serves the area where the community solar energy generating 26
system is located; and 27
(iii) 1. is used for agrivoltaics; or 28
2. is installed on a rooftop, brownfield, parking facility 29
canopy, landfill, or clean fill. 30
(4) On or before October 1 each year, the Department shall report to the 31
Senate Budget and Taxation Committee and the House Ways and Means Committee, in 32 HOUSE BILL 1435 9
accordance with § 2–1257 of the State Government Article, on the number and location of 1
projects that, in the immediately preceding taxable year, have received the exemption 2
under this subsection. 3
7–249. 4
NONRESIDENTIAL SOLAR ENERGY GENERATING SY STEMS THAT ARE 5
CONSTRUCTED ON THE R OOFTOPS OF BUILDINGS OR ON PARKING FACILI TY 6
CANOPIES ARE NOT SUBJ ECT TO VALUATION OR TO PROPERTY TAX . 7
7–250. 8
(A) THE GOVERNING BODY OF A COUNTY OR MUNICIPA L CORPORATION MAY 9
REDUCE OR ELIMINATE , BY LAW, THE PERCENTAGE OF TH E ASSESSMENT OF ANY 10
REAL PROPERTY THAT I S SUBJECT TO THE COU NTY OR MUNICIPAL COR PORATION 11
PROPERTY TAX UNDER T HIS ARTICLE IF THE R EAL PROPERTY INCLUDE S A PARKING 12
FACILITY ON WHICH A SOLAR ENERGY GENERAT ING SYSTEM HAS BEEN 13
CONSTRUCTED ON ITS C ANOPY. 14
(B) (1) A COUNTY OR MUNICIPAL CORPORATION THAT RED UCES OR 15
ELIMINATES THE PERCE NTAGE OF ASSESSM ENT OF TAXABLE REAL PROPERTY 16
UNDER SUBSECTION (A) OF THIS SECTION SHAL L SUBMIT A COPY OF T HE LAW TO 17
THE DEPARTMENT . 18
(2) IF THE DEPARTMENT RECEIVES A COPY OF THE LAW ON O R 19
BEFORE MAY 1, THE CHANGE WILL BE E FFECTIVE FOR THE TAX ABLE YEAR 20
FOLLOWING THE DAT E THE LAW IS ENACTED . 21
(C) IF ANY REAL PROPERTY IS EXEMPT UNDER SUBS ECTION (B) OF THIS 22
SECTION FROM COUNTY PROPERTY TAX BUT IS SUBJECT TO MUNICIPAL 23
CORPORATION PROPERTY TAX, THE DEPARTMENT OR THE SUP ERVISOR SHALL 24
PROVIDE THE MUNICIPA L CORPORATION WITH THE ASSESSMENT OF TH E REAL 25
PROPERTY. 26
(D) THE DEPARTMENT MAY ADOPT REGULATIONS TO IMPLE MENT THIS 27
SECTION. 28
7–522. 29
THE GOVERNING BODY OF A COUNTY SHALL EXEMPT OR PARTIALLY EXEMPT 30
A GROUND–MOUNTED SOLAR ENERGY GENERATING SYSTEM FR OM THE COUNTY 31
REAL OR PE RSONAL PROPERTY TAX IF THE OWNER OF THE SYSTEM AND THE 32
COUNTY ENTER INTO A PAYMENT IN LIEU OF T AXES AGREEMENT , APPROVED BY 33
ORDINANCE OF THE LEG ISLATIVE BODY OF THE COUNTY, THAT SPECIFIES: 34 10 HOUSE BILL 1435
(1) THAT THE OWNER OF TH E SYSTEM SHALL PAY T O THE COUNTY 1
EACH YEAR IN LIEU OF THE PA YMENT OF COUNTY REAL OR PERSONAL PROPERTY 2
TAXES DURING THE TER M OF THE AGREEMENT THE SUM OF $2,500 PER MEGAWATT 3
OF GENERATING CAPACI TY OF THE SYSTEM , AS MEASURED BY THE A LTERNATING 4
CURRENT RATING OF TH E SYSTEM’S INVERTER; 5
(2) THE TERM OF THE AGREEMENT ; AND 6
(3) THAT EACH YEAR AFTER THE EXPIRATION OR TE RMINATION OF 7
THE AGREEMENT , FULL REAL AND PERSON AL PROPERTY TAXES SH ALL BE PAYABLE 8
ON THE PROPERTY . 9
SECTION 3. AND BE IT FURTHER ENACTED, That a presently existing obligation 10
or contract right may not be impaired in any way by this Act. 11
SECTION 4. AND BE IT FURTHER ENACTED, That Section 2 of this Act shall be 12
applicable to all taxable years beginning after June 30, 2024. 13
SECTION 5. AND BE IT FURTHER ENACTED, That this Act shall take effect June 14
1, 2024. 15