NCPA - National Center for Policy Analysis

Maryland Spends Millions on Renewable Energy for Just Thousands in Savings

November 30, 2011

For the past three fiscal years, Maryland residents have been eligible to reap the benefits of a state-run grant program that helps homeowners pay for the purchase and installation of solar energy systems, geothermal heat pumps and small wind turbines.  The grant program is part of Maryland's aggressive push to expand the state's renewable energy industry, after lawmakers passed a measure requiring utilities to buy 20 percent of their energy from renewable sources by 2022.  However, a recent report by the state's energy agency has shown that the costs of the program significantly outweigh the benefits, says the Washington Examiner.

  • According to that agency, Maryland has spent $150 million on clean energy initiatives between fiscal 2009 and fiscal 2011.
  • The state spent $2.3 million last fiscal year on the grant program, but it brought in only $637,000 in savings.
  • Ongoing savings from the grants will add up to roughly $3.2 million over the course of five years, yet this will still fail to compensate for the expense of the program.

The grants are distributed to individual residents on a first-come, first-serve basis, yet there are anomalies within the pattern of grant distribution.

  • Montgomery County residents received one of every five grants the state distributed for a total of $1.3 million.
  • Howard County residents came in second for most state spending on the program, winning a total of $771,192 in grant money.
  • By comparison, Prince George's County residents received roughly 5 percent, or $265,200, of the grant money.

Dee Hodges, president of the Maryland Taxpayers Association, argues that renewable energy sources are simply not profitable enough to confer significant savings.  The outcome of the grant program seems to speak to the truth of this observation.

Source: Hayley Peterson, "Maryland Spends $2.3m on Renewable Energy for $637,000 in Savings," Washington Examiner, November 21, 2011.


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