Solar FAQs

What is net metering?

Customers who generate their own electricity will have a net meter installed that will measure the amount of energy the customer purchases from SMECO (when the customer’s system is not producing enough to meet the customer’s need) and the amount of energy the customer sells to SMECO (when the system is producing more than enough to meet the customer’s need). Customers are billed for the difference—purchases minus sales. SMECO’s meter doesn’t measure how much energy you produced and used during the month.

Solar as an investment—is it worth it?

Solar panels or photovoltaic (PV) systems may be a good investment for some customers, but not for others. If your main goal is to reduce your bill, first try to use as little energy as possible to see how that affects your bill. To help you save, SMECO has programs available such as the Home Energy Improvement Program, along with helpful free advice to reduce energy use and reduce your bill.

The amount of energy you typically use, the amount of sun in your yard, the number of solar panels installed, and the cost of installation are just some of the factors that need to be considered when you get estimates for solar PV systems.

How much will I save on my electric bill?

The amount you save on your monthly SMECO bill depends on how much energy you use and how much you produce.

Do you own or lease your PV system? If you purchase the system, you will reduce your electric utility bill, but you will have a cost associated with your solar system, so it could be a very long time before you break even.

If you lease a system, you will receive a monthly electric utility bill, along with a monthly bill from the solar installer. You may save on your utility bill, but the savings may or may not cover the monthly lease of the solar panels.

Is solar right for me?

Enter an address and WattPlan will estimate your potential for a rooftop solar array. You will get an estimate of the electricity you can generate and how much you might save each year on your electric bill.

The figures shown are estimates only and do not constitute a guarantee of savings on your electric bill.

Will I receive a credit for the energy I produce?

In accordance with state regulations, SMECO provides a credit on April electric bills for all net metering customers who have an excess generation balance. In April 2024, the average credit was $66.87 for 2,812 SMECO residential customers. (More than 8,524 customers had net meters as of April 1, 2024.)

What size system should I get?

The size of the system depends on how much energy you use and how much you want to spend on a PV system. Most customers apply for Level One, which means they get a system that generates 20 kilowatts (kw) or less, and they qualify for the expedited application review. Customers who get a system that generates more than 20 kW have a more in-depth application to complete and there is a charge associated with it.

Will I still receive a SMECO bill if I’m generating my own power?

SMECO charges for metering and other services provided to customers whenever they need energy from the grid. It’s possible to have a system large enough to supply all of your power with full battery back-up; however, as long as your utility provides a meter and power to your location, you will receive a monthly bill for the facility charge.

If SMECO has a power outage, will I still get power from my PV system?

If there’s a power outage, the customer’s power will go out, too. A safety feature is required in all grid–connected PV systems that prevents the PV system from feeding back onto the utility lines. It is possible to set up a battery back-up system or a generator, but you will need a transfer switch to isolate the PV system from the generator and the electric grid. When these back-up systems are incorporated into the PV project, the price increases substantially.

How much do PV systems cost?

The cost of solar systems varies and depends on the arrangement between the customer and installer. Tax incentives or rebates could also be available from the federal or state government. Some customers lease systems for a long period. Leasing options generally include a price per kilowatt-hour that escalates at an annual percentage rate. The terms of your contract may vary, so be sure to review it thoroughly and make sure you understand it before you commit.

Will SMECO charge me to install a PV system?

SMECO does not charge for the Level One applications (for systems that are 20 kW or less). Level Two and Level Three applications cost $260 and Level Four applications cost $950. However, if you require SMECO to make upgrades to accommodate your system, you will be charged for the upgrades.

Visit North Carolina State University’s DSIRE USA site for a listing of grants, tax credits, and other incentives available.

Will SMECO charge me to install a net meter?

SMECO does not charge for exchanging the standard residential meter for a net meter. The net meter will measure the amount of energy the customer uses and the amount of energy the customer produces; customers are billed for the difference—the net amount of energy used.

How do I apply?

All Maryland utilities have the same application process. You can complete SMECO’s application online using PowerClerk. If you use a solar installation company, that firm will normally supply most of the information required.

How do I start?

Most SMECO customers use a solar installation company and that contractor completes most of the paperwork and provides the utility with most of the required information. This step-by-step guide outlines the steps that SMECO and the customer take to complete the process: Interconnection Procedures (PDF).

Building a new home? Consider installing a PV system from the start.

Customers building a new home may be able to include the cost of their PV system in the mortgage, which may save on financing costs. Talk to your lender to get details before you install your system. In addition, with a lower monthly utility bill, you may have a better income to debt ratio, which may allow you to borrow more for your mortgage.

Can I install my solar panels myself or do I need to work with a contractor?

You aren’t required to work with a solar installation company, but most customers do. If you are installing a PV system yourself, you need to have the technical expertise to provide SMECO with the required information.

Customers who have a solid electrical background, who are mechanically inclined, and who know their county’s electrical and building codes may be able to install their own PV system. After SMECO reviews your application, you need to get the proper county permits.

Questions you should ask a solar contractor
  • Are you a licensed and certified installer?
  • How much energy do you estimate I will produce?
  • When you size my system based on my home, can you give me different options on sizes and costs and how they will affect the amount of energy I will use from the grid?
  • How much will the installation cost? Do I have to pay anything up front? Are there financing options or monthly fees?
  • How much of a reduction will I receive on my monthly SMECO bills? (Summer, winter, spring, and fall will be different based on the angle of the sun, the amount of energy used, and the amount of energy you produce.)
  • If leasing, what are the details of the lease agreement? Number of years? Interest rate?
  • What happens if I sell my home? Is the lease transferable to a new homeowner?
  • What if my roof needs new shingles or I want the system removed, is there a buyout?
  • Do I need special homeowner’s insurance?
  • Will I need any upgrades to my electric system? If so, who will pay SMECO or an electrician to make the upgrades and how much will they cost?
  • Can the solar panels be installed anywhere on my property or only on my roof?
  • Will I receive any tax credits?
  • How many systems have you installed in the area and do you have references that I can check? Please provide names and contact information for local SMECO customers for whom you’ve done PV installations.
Doesn’t SMECO lose money when customers install their own solar?

SMECO doesn’t lose money on the energy supply because SMECO only pays for the amount of energy customers use. When customers produce their own energy and use less energy supplied by the grid, their distribution costs are reduced. Distribution charges cover the cost of SMECO’s electric system, vehicles, buildings, power lines, substations, transformers, etc.