Commercial Energy Incentives and Resources
Energy costs are the largest non-fixed expense in a commercial property’s operating budget. Energy-efficient improvements can reduce energy costs which can help trim overhead, improve property value, and attract and retain tenants. To make these improvements, financial incentives for adopting energy-efficient practices and renewable technologies are available from utilities, as well as local, state, and federal sources.
The resources on this page can help commercial property owners gain a better understanding of energy use in their buildings and learn about available incentives to improve the economics of energy efficiency and renewable energy upgrades.
Energy Assessments
As a first step towards saving energy, commercial property owners can get an energy assessment. Energy assessments performed by in-house staff of a licensed professional can help provide a better understanding of how energy is used in the building and recommended energy efficiency upgrades.Depending on the type of assessment and test performed, you can take advantage of free/discounted assessments offered by your utility company; you can hire a professional contractor to do a full energy assessment for a couple hundred dollars or more; or you can perform the assessment yourself:
Utility-provided Assessments
- Pepco offers Quick Energy Check-ups for small business properties at no cost. Incentives for discounted energy assessments may also be available for larger commercial properties. Visit Pepco’s Check-ups and Audits webpage to find a qualified contractor and apply for an assessment.
- BGE’s Building Tune-up Program for large and small commercial properties offers financial incentives for up to 75% of the service costs. Contact BGE to learn more about this program.
Hire a Certified Contractor
- Several programs train and certify contractors to conduct commercial energy assessments. Having a certified contractor conduct your assessment ensures that it complies with the program's standards. Note, many energy auditors are not contractors, so they have no financial stake in making energy improvement recommendations.
Do-It-Yourself with Online Tools and Resources
- DOE’s Building Energy Asset Score is national standardized tool for assessing the physical and structural energy efficiency of commercial buildings. The Asset Score generates a simple energy efficiency rating that enables comparison among buildings, and identifies opportunities to invest in energy efficiency upgrades. It is available for voluntary use and is 100% free to use. Learn more about the tool on DOE’s website.
- EPA's ENERGY STAR Program has tools and resources to help you benchmark the energy use of your commercial property, earn the ENERGY STAR certification for eligible property types, and target energy-efficiency upgrades in your properties with checklists and case studies. Learn more about benchmarking and resources on EPA’s website.
- Potomac Edison’s Business Energy Analyzer is a tool to save energy and money that produces a report analyzing major sources of energy use and identifying strategies and projects to save energy. Potomac Edison customers can learn more about this tool here.
- Utilities also offer incentives to cover a percentage of building energy efficiency training course enrollment fees or tuition costs for facility operators. Learn more about Pepco’s Operations & Maintenance Training program, Potomac Edison’s Tuition Reimbursement program and BGE’s Building Operation Training Courses.
Financial Incentives
Owners of Montgomery County commercial properties can take advantage of financial incentives to adopt energy-efficient practices and renewable technologies. Incentives are available from utilities, as well as local, state, and federal sources.
Additional incentives may be available. For the most current information about Maryland incentives and programs, please see the Database of State Incentives for Renewables & Efficiency (DSIRE) website.
Utility Incentives
Maryland’s major utility energy using funding from the
EmPower Maryland Act, provides a variety of incentives for energy savings in commercial buildings properties. These programs are highly diverse and offer solutions for a variety of building owners and operators.
Commercial incentives from electricity providers may include rebates or discounts for:
- Lighting
- Chillers and packaged HVAC units
- Demand management programs
- Combined heat and power systems
- Commercial kitchen equipment, such as freezers, ice makers, and dishwashers
- Energy-efficient appliances, such as dehumidifiers and clothes washers
- Energy audits and commissioning
Additional commercial incentives are available from your natural gas provider including:
- Eligible water heaters
- Combined heat and power systems\
- High-efficiency natural gas boilers and burners
- Boilers and other space heating systems
- Food service appliances and systems
- Generators
- Energy management systems
Click on your utility below to access their incentives websites:
Government Programs and Incentives
To encourage energy savings, local, state, and federal governments offer rebates, tax credits, and financing programs.
Federal Incentives
- Commercial Energy Efficiency Tax Deduction (179-D) is a tax deduction of up to $1.80 per square foot available to owners or designers of new or existing commercial buildings that save at least 50% of the heating and cooling energy of a building that meets ASHRAE Standard 90.1-2007. Partial deductions can be taken for measures affecting any one of three building systems: the building envelope, lighting, or heating and cooling systems. These tax deductions are available for systems “placed in service” after December 31, 2016.
- Federal Clean Energy Tax Credits are available to businesses and for-profit organizations who installed solar energy systems, geothermal heat pumps, or small wind turbines. This tax credit is one of the single largest incentives for the installation of these environmentally beneficial technologies. Visit the ENERGY STAR website to learn more about these tax deductions.
- ENERGY STAR Special Offer and Rebate Finder can help locate money-saving opportunities. Considering purchasing an ENERGY STAR qualified product or making improvements to your business in the near future? Looking for businesses and manufacturers with special rebates? Use the ENERGY STAR Special Offer and Rebate Finder.
- Federal Tax Credits for All-Electric and Plug-in Hybrid Vehicles is available for commercial businesses, if the qualifying vehicle is purchased for business use. The credit for the business use of an electric vehicle is reported on Form 3800, General Business Credit. Learn more about this credit here.
- Additional Tax Incentives are available for energy efficiency upgrades in commercial properties. Learn more about these incentives on DOE’s website.
State Incentives
- Maryland Energy Administration offers energy incentive programs for commercial property owners that identify energy saving practices and affordable ways can install renewable energy systems. MEA offers energy efficiency loans, as well as grants for energy efficiency and grants for clean energy projects. Note that some funds often run out quickly, so make sure you reach out to the Maryland Energy Administration for updated information.
- Maryland Energy Administration also offers incentives through its Parking Lot Solar PV Canopy with Electric Vehicle Charger Program. To drive down the initial costs associated with installing solar PV canopy systems, MEA awards grants to qualified applicants on a competitive basis. Selected grantees meeting grant program requirements and restrictions will receive an award in of up to $300/kW of installed solar PV capacity, with a cap of $150,000 per project. Learn more about this program on MEA’s website.
- Maryland Clean Energy Center provides attractive financing options for non-profit and for-profit businesses looking to make energy efficiency and renewable energy upgrades. Learn more on MCEC’s website.
Montgomery County Incentives
- Commercial Property Assessed Clean Energy (C-PACE) Financing: Montgomery County offers a program for commercial property owners to access C-PACE financing. C-PACE is an innovative way to finance energy efficiency and renewable energy upgrades, repaid as a surcharge on the property tax bill. Learn more about the County’s C-PACE financing program.
- Property Tax Credit for Energy and Environmental Design: Montgomery County organizations that pay property taxes and achieve high levels of green achievement verified by either the U.S. Green Building Council (or an equivalent standard approved by the County’s Department of Permitting Services) are eligible for a property tax credit between 10% and 75% for 3 or 5 years depending on the LEED rating system (or equivalent) and level of achievement. Learn more about the property tax credit on the Department of Finance’s website.
The incentives also vary between buildings “covered” by the County’s 2006 Green Building Law, which required all newly constructed or extensively modified non-residential or multifamily residential buildings that are at least 10,000 gross square feet to achieve a minimum of LEED certified or equivalent, or not. Covered buildings are subject to the law whereas uncovered buildings are not.
| Rating System | Achievement Level | Percentage Credit | Credit Year |
|---|---|---|---|
| LEED NC or CS | Gold | 25% | 5 |
| LEED NC or CS | Platnium | 75% | 5 |
| LEED - EBOM | Gold | 10% | 3 |
| LEED - EBOM | Platnium | 50% | 3 |
Buildings not covered under the 2006 Green Building Mandate, which would typically be older existing buildings or buildings constructed after 2008 that are under 10,000 square feet, are eligible for the following incentives:
| Rating System | Achievement Level | Percentage Credit | Credit Year |
|---|---|---|---|
| LEED NC or CS | Silver | 25% | 5 |
| LEED NC or CS | Gold | 50% | 5 |
| LEED NC or CS | Platnium | 75% | 5 |
| LEED - EBOM | Silver | 10% | 3 |
| LEED - EBOM | Gold | 25% | 3 |
| LEED - EBOM | Platnium | 50% | 3 |
The tax credit must be applied for within 1 year of the building being certified as a high energy performance building.
Download the application for the tax credit from the Division of Treasury website. (PDF, 85KB)
