Maryland has become one of the nation's strongest community solar markets—but for commercial property owners, timing is becoming increasingly important.
Strong subscriber demand, a permanent statewide program, and attractive project economics continue to create compelling development opportunities. As Maryland's community solar program evolves, property owners who evaluate opportunities earlier will have greater flexibility to maximize project value.
Maryland's Utility RELIEF Act changes how future community solar projects will be compensated beginning July 1, 2027, or when the statewide 3,000 MW cap is reached. Projects that qualify before then maximize project economics under today's regulatory framework.
Because community solar projects typically require 14–32 months from initial site evaluation to commercial operation, property owners considering the opportunity should begin evaluating their properties well before the transition. Starting early provides more time to assess site suitability, complete interconnection studies, navigate permitting, and position a project under the current program.
Community solar allows commercial property owners to generate income from underutilized rooftops or land without owning or operating a solar system.
Under a typical host lease structure, a solar developer finances, designs, builds, owns, and operates the project at no cost to the property owner. The electricity generated is delivered to the grid, and subscribers receive credits on their utility bills based on their share of the system's output.
In exchange for hosting the project, the property owner receives long-term lease payments, typically structured over a 20-year term. The developer manages subscriber enrollment, billing, maintenance, and ongoing operations.
For REITs and portfolio owners, the model is particularly straightforward. Because the developer owns the system, they capture available tax incentives and assume operational responsibility, while the host receives a predictable income stream with no capital investment required.
For commercial property owners, the financial case is built on a simple premise: lease your rooftop or land to a qualified solar developer, collect predictable income for 20 years, and put no capital at risk.
Based on current Maryland market conditions, property owners hosting community solar projects can expect average annual lease earnings of approximately $80,000 — translating to roughly $1.6 million in cumulative income over a standard 20-year term, with annual escalators of 1–2% built into most agreements.
Figure 1. Typical community solar host economics for a qualifying 150,000-square-foot commercial roof in Maryland. Property owners may earn, on average, $80,000 annually and $1.6 million over a 20-year lease term with no upfront capital investment.
1. Roof condition and useful life. A system installed today is expected to operate for 20 or more years. Developers will require confidence that the underlying roof can support that lifespan. Buildings with roofs nearing the end of life may need remediation before or alongside installation, affecting the timeline and net economics. Significant shading from HVAC equipment, parapets, or adjacent structures also reduces usable capacity. Roof condition and age are among the first things a credible site evaluation will assess.
2. Utility territory. Maryland's four participating utility territories present different combinations of subscriber demand, grid capacity, and interconnection complexity. Some territories offer deeper subscriber pools, while others provide more favorable development conditions. Where a property is located can materially affect both project economics and development timelines.
3. Grid access and interconnection feasibility. A building with strong physical characteristics can still face significant cost increases or timeline delays if the local grid lacks sufficient hosting capacity. Interconnection feasibility is one of the most important factors in determining project viability. Larger projects may also require additional regulatory approvals, adding time and complexity to the development process.
4. Existing encumbrances. Roof or ground leases, easements, deed restrictions, or zoning classifications that limit energy development use all require review before a community solar lease can be structured. These are rarely dealbreakers, but they are better surfaced early than discovered mid-negotiation.
Those four factors determine where your property lands relative to the $80,000 annual average. A detailed site evaluation is typically required to determine a property's revenue potential, interconnection feasibility, and development timeline.
Maryland's community solar program continues to evolve, and those changes can affect project economics, development timelines, and long-term planning for commercial property owners.
The Utility RELIEF Act. The Utility RELIEF Act begins Maryland's transition away from the current retail-rate net metering framework (NEM 1.0). While the Maryland Public Service Commission (PSC) is still defining the successor program, most industry observers expect future community solar projects to operate under less favorable economics than those qualifying under the current framework.
Consolidated billing. Beginning January 1, 2026, Maryland implemented consolidated billing—a streamlined crediting mechanism that simplifies the subscriber experience and reduces enrollment friction, supporting more stable subscriber pools over the life of a project.
Certified SREC bonus. Systems that qualify under the Brighter Tomorrow Act—including those placed in service between July 1, 2024, and January 1, 2028, on eligible rooftops and other qualifying sites—earn Certified SRECs at 1.5 times the standard rate. This strengthens project economics during the qualification window and can support stronger lease terms for hosts.
Figure 2. Key Maryland community solar regulatory milestones from 2025–2028, including the implementation of consolidated billing, the NEM 2.0 framework deadline, the July 2027 NEM 1.0 closure date, and the expiration of the Certified SREC bonus.
Three factors are converging:
For property owners, evaluating a site sooner provides greater flexibility while current market conditions remain available.
"Beginning a site evaluation early gives property owners more flexibility to assess structural conditions, interconnection feasibility, permitting requirements, and lease terms before project timelines become more constrained. . Starting the process doesn't commit a property owner to development—it simply provides the information needed to evaluate the opportunity," states Wayne Pfister, CEO of Pfister Energy.
Maryland requires every community solar project to allocate at least 40% of its output to low- and moderate-income (LMI) subscribers, who must receive guaranteed savings of at least 10% relative to their standard utility rate. Managing that requirement is entirely the developer's responsibility — not the hosts.
But LMI subscriber recruitment is consistently slower and more operationally demanding than market-rate recruitment, and a project that struggles to reach full subscription delays the stable lease income a host is counting on. How well a developer manages their LMI pipeline is a legitimate due diligence question — and one that plays out very differently depending on where your property sits.
Maryland's four utility territories present an uneven LMI landscape. BGE and Pepco territories have deep LMI subscriber pools but limited development sites and tighter grid capacity. Potomac Edison and Delmarva territories offer stronger grid access and more viable development sites, but have thinner LMI populations — meaning developers operating there need established low-density recruitment infrastructure to reliably hit the 40% threshold on schedule.
Figure 3. Comparison of Maryland utility territories based on LMI subscriber availability, development site availability, and grid hosting capacity across BGE, Pepco, Potomac Edison, and Delmarva Power.
For REITs with assets across multiple territories, this means your portfolio doesn't represent a uniform opportunity. Each property warrants its own evaluation — including the LMI dynamics specific to its utility territory.
The largest risks in community solar are rarely technical. They are development and execution risks — interconnection feasibility, project timelines, subscriber acquisition, and lease structure — that ultimately determine whether a project delivers on its expected economics. Evaluating these five areas before committing will improve the project's long-term ROI and success.
1. Confirm interconnection feasibility before committing to a lease. Lease terms are only as good as the project's ability to get built. A developer who moves quickly to secure a host site before completing a preliminary interconnection assessment may be prioritizing pipeline over execution. Interconnection feasibility should precede any lease commitment.
2. Understand the development timeline — and its implications. A realistic path from initial site assessment to commercial operation runs 14 to 32 months, varying significantly based on utility territory, interconnection requirements, permitting complexity, and project size. In a market where program economics may change over time, delays can have financial implications beyond simple schedule impacts. Ask any prospective developer for a realistic timeline specific to your site and territory — not a best-case projection.
3. Discuss your developer's approach to LMI subscriber recruitment. LMI recruitment is more operationally demanding than market-rate recruitment, and a developer's capability in your specific utility territory is worth exploring before you sign. Ask how they source LMI subscribers, what their current subscription rates look like across their portfolio, and what community partnerships support their outreach.
4. Plan for roof remediation. A roof requiring replacement mid-lease creates costly complications for both parties. Assess roof condition and useful life relative to a 20-year lease term before signing — not after installation. A credible developer will raise this proactively in the site evaluation process.
5. Look for escalator provisions, clear lease terms, and a proven track record. A flat lease payment over 20 years loses meaningful value to inflation, so most well-structured agreements include annual escalators of 1–2%. It's also worth reviewing how the agreement handles maintenance responsibilities, roof access, and end-of-term obligations. Because community solar leases often extend for 20 years or more, property owners should also understand who stands behind the project and whether the developer has the financial strength and operating history to support long-term performance.
Community solar remains one of the most effective ways to generate long-term income from underutilized real estate. But because development timelines are measured in years—and Maryland's regulatory landscape is evolving—the best time to evaluate a property's potential is before timing becomes a constraint.
The first step isn't committing to a project—it's understanding your options. A site evaluation can help determine development potential, estimated lease revenue, interconnection considerations, and project timing so you can make an informed decision with confidence.
Learn more about Pfister Energy's Community Solar services or Contact Pfister Energy to learn whether your property may be a candidate for development.