Public Utilities – Solar Energy Generating Systems and Solar Renewable Energy Credits (Affordable Solar Act)

EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*sb0341*

SENATE BILL 341
C5, M5 6lr1523
CF HB 345
By: Senators Brooks, Kramer, and Lam
Introduced and read first time: January 23, 2026
Assigned to: Education, Energy, and the Environment

A BILL ENTITLED

AN ACT concerning 1

Public Utilities – Solar Energy Generating Systems and Solar Renewable 2
Energy Credits 3
(Affordable Solar Act) 4

FOR the purpose of authorizing the purchase, installation, and use of a certain portable 5
solar energy generating system for certain purposes; altering the renewable energy 6
portfolio standard to include energy derived from certain solar energy generating 7
systems; authorizing an electric cooperative and a municipal electric util ity to meet 8
their renewable energy portfolio standard for solar energy in a certain manner; 9
requiring that certain alternative compliance fees be paid into a certain escrow 10
account rather than into the Maryland Strategic Energy Investment Fund; requiring 11
the Public Service Commission to require electric companies to procure a certain 12
number of SRECs and SREC–IIs; requiring the Commission to issue solicitations for 13
the construction of distributed solar energy generating systems and utility –scale 14
solar energy generating systems; providing for the terms and conditions of 15
solicitations and procurement of certain solar energy generating systems; 16
establishing an escrow account for certain alternative compliance payments; 17
requiring certain public service companies to file gross receipt tax information; 18
requiring a portion of the franchise tax revenue from certain customers to be placed 19
in a certain escrow account; and generally relating to solar energy generating 20
systems and solar renewable energy credits. 21

BY adding to 22
Article – Public Utilities 23
Section 7–321, 7–701(l–1), (l–2), (p–2), and (p–3), and 7–709.2; and 7–1232 through 24
7–1235 to be under the new part “Part V. Solar Energy” 25
Annotated Code of Maryland 26
(2025 Replacement Volume and 2025 Supplement) 27

BY repealing and reenacting, without amendments, 28
Article – Public Utilities 29
2 SENATE BILL 341

Section 7–701(a) and 7–705(a) 1
Annotated Code of Maryland 2
(2025 Replacement Volume and 2025 Supplement) 3

BY repealing and reenacting, with amendments, 4
Article – Public Utilities 5
Section 7–703(a), (b)(23) through (25), and (e) and 7–705(b) and (b–1) 6
Annotated Code of Maryland 7
(2025 Replacement Volume and 2025 Supplement) 8

BY repealing and reenacting, with amendments, 9
Article – Tax – General 10
Section 8–404 and 8–408 11
Annotated Code of Maryland 12
(2022 Replacement Volume and 2025 Supplement) 13

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 14
That the Laws of Maryland read as follows: 15

Article – Public Utilities 16

7–321. 17

(A) IN THIS SECTION , “PORTABLE SOLAR ENERG Y GENERATING SYSTEM” 18
MEANS A MOVABLE PHOTOVOLTAIC SOLAR ENERGY GENERATION DEVICE THAT IS: 19

(1) DESIGNED TO BE CONNE CTED TO A BUILDING ’S ELECTRICAL 20
SYSTEM THROUGH A STANDARD ELECTRICAL OUTLET; 21

(2) PRIMARILY INTENDED T O OFFSET PART OF THE BUILDING’S 22
ELECTRICITY CONSUMPTION; 23

(3) LIMITED TO SUPPLYING A MAXIMUM POWER OUTP UT OF NOT 24
MORE THAN 1,200 WATTS BACK TO THE ELECTRIC SYSTEM; AND 25

(4) CERTIFIED BY UNDERWRITERS LABORATORY OR AN EQUIVALENT 26
NATIONALLY RECOGNIZED TESTING LABORATORY. 27

(B) A PERSON MAY P URCHASE AND INSTALL A PORTABLE SOLAR ENE RGY 28
GENERATING SYSTEM FOR RESIDENTIAL USE ONLY. 29

(C) A PORTABLE SOLAR ENERGY GENERATING SYSTEM: 30

(1) IS NOT SUBJECT TO THE REQUIREMENTS OF §§ 7–306 AND 7–306.1 31
OF THIS TITLE; 32
SENATE BILL 341 3

(2) IS NOT ELIGIBLE FOR INCLUSION IN MEETING THE RENEWA BLE 1
ENERGY PORTFOLIO STANDARD; AND 2

(3) MAY NOT GENERATE RENEWABLE ENERGY CREDITS OF ANY TYPE. 3

(D) AN ELECTRIC COMPANY: 4

(1) MAY NOT REQUIRE A CU STOMER USING A PORTA BLE SOLAR 5
ENERGY GENERATING SYSTEM TO: 6

(I) OBTAIN THE ELECTRIC COMPANY ’S APPROVAL BEFORE 7
INSTALLING OR USING THE PORTABLE SOLAR ENERGY GENERATING SYSTEM; 8

(II) PAY ANY FEE OR CHARG E RELATED TO THE POR TABLE 9
SOLAR ENERGY GENERATING SYSTEM’S ABILITY TO FEED EL ECTRICITY BACK INTO 10
THE ELECTRIC SYSTEM; OR 11

(III) INSTALL ANY ADDITION AL CONTROLS OR EQUIP MENT 12
BEYOND WHAT IS INTEG RATED INTO THE PORTA BLE SOLAR ENERGY GEN ERATING 13
SYSTEM; AND 14

(2) IS NOT LIABLE FOR ANY DAMAGE CAUSED BY A PORTABLE SOLAR 15
ENERGY GENERATING SYSTEM. 16

7–701. 17

(a) In this subtitle the following words have the meanings indicated. 18

(L–1) “QUALIFYING DISTRIBUTE D SOLAR ENERGY GENER ATING SYSTEM ” 19
MEANS A SOLAR PHOTOVOLTAIC SYSTEM THAT: 20

(1) HAS A GENERATING CAP ACITY OF 5 MEGAWATTS OR LESS , AS 21
MEASURED BY THE ALTE RNATING CURRENT RATI NG OF THE SYSTEM’S INVERTER; 22
AND 23

(2) IS CERTIFIED TO GENERATE SREC–II CREDITS. 24

(L–2) “QUALIFYING UTILITY –SCALE SOLAR ENERGY G ENERATING SYSTEM ” 25
MEANS A SOLAR PHOTOVOLTAIC SYSTEM THAT: 26

(1) HAS A GENERATING CAP ACITY THAT IS GREATE R THAN 5 27
MEGAWATTS, AS MEASURED BY THE ALTERNATING C URRENT RATING OF THE 28
SYSTEM’S INVERTER; AND 29
4 SENATE BILL 341

(2) IS CERTIFIED TO GENERATE SREC–II CREDITS. 1

(P–2) “SOLAR RENEWABLE ENERG Y CREDIT ” OR “SREC” MEANS A 2
RENEWABLE ENERGY CRE DIT THAT IS DERIVED FROM A SOLAR ENERGY TIER 1 3
RENEWABLE SOURCE THAT: 4

(1) IS CONNECTED TO THE DISTRIBUTION SYSTEM IN THE STATE; AND 5

(2) IS NOT CERTIFIED TO RECEIVE SREC–II CREDITS. 6

(P–3) “SOLAR RENEWABLE ENERG Y CREDIT II” OR “SREC–II” MEANS A 7
SOLAR RENEWABLE ENERGY CREDIT EQUAL TO THE GENERATION ATTRIBUTES OF 1 8
MEGAWATT–HOUR OF ELECTRICITY CONNECTED TO THE ELECTRIC TRANSMISSION 9
OR DISTRIBUTION SYSTEM SERVING THE STATE AND DERIVED FROM: 10

(1) A QUALIFYING DISTRIB UTED SOLAR ENERGY GE NERATING 11
SYSTEM; OR 12

(2) A QUALIFYING UTILITY –SCALE SOLAR ENERGY G ENERATING 13
SYSTEM. 14

7–703. 15

(a) (1) (i) The Commission shall implement a renewable energy portfolio 16
standard that, except as provided under paragraphs [(2) and (3)] (2), (3), AND (4) of this 17
subsection, applies to all retail electricity sales in the State by electricity suppliers. 18

(ii) If the standard becomes applicable to electricity sold to a 19
customer after the start of a calendar year, the standard does not apply to electricity sold 20
to the customer during that portion of the year before the standard became applicable. 21

(2) A renewable energy portfolio standard may not apply to electricity sales 22
at retail by any electricity supplier: 23

(i) in excess of 300,000,000 kilowatt–hours of industrial process load 24
to a single customer in a year; 25

(ii) to residential customers in a region of the State in which 26
electricity prices for residential customers are subject to a freeze or cap contained in a 27
settlement agreement entered into under § 7 –505 of this title until the freeze or cap has 28
expired; or 29

(iii) to a cust omer served by an electric cooperative under an 30
electricity supplier purchase agreement that existed on October 1, 2004, until the 31
SENATE BILL 341 5

expiration of the agreement, as the agreement may be renewed or amended. 1

(3) The portion of a renewable energy portfolio standard that represents 2
offshore wind energy: 3

(i) applies only to the distribution sales of electric companies; and 4

(ii) may not apply to distribution sales by any electric company in 5
excess of: 6

1. 75,000,000 kilowatt–hours of industrial proc ess load to a 7
single customer in a year; and 8

2. 3,000 kilowatt –hours of electricity in a month to a 9
customer who is an owner of agricultural land and files an Internal Revenue Service form 10
1040, schedule F. 11

(4) THE PORTION OF A RENE WABLE ENERGY PORTFOLIO STANDARD 12
THAT REPRESENTS SOLA R ENERGY THAT IS DER IVED FROM QUALIFYING 13
DISTRIBUTED SOLAR EN ERGY GENERATING SYST EMS AND QUALIFYING 14
UTILITY–SCALE SOLAR ENERGY G ENERATING SYSTEMS AP PLIES ONLY TO THE 15
DISTRIBUTION SALES OF ELECTRIC COMPANIES. 16

(b) Except as provided in subsections (e) and (f) of this section, the renewable 17
energy portfolio standard shall be as follows: 18

(23) in 2028: 19

(i) AN AMOUNT EQUAL TO THE SUM OF: 20

1. 43% from Tier 1 renewable sources, including: 21

[1.] A. at least 11% derived from solar energy THAT IS NOT 22
GENERATED FROM SOURCES IDENTIFIED IN ITEM 2 OF THIS ITEM; 23

[2.] B. an amount set by the Commission under § 24
7–704.2(a) of this subtitle derived from offshore wind energy, including at least 800 25
megawatts of Round 2 offshore wind projects; and 26

[3.] C. at least 1% derived from post –2022 geothermal 27
systems; and 28

2. AN AMOUNT SET BY THE COMMISSION UNDER § 29
7–709.2 OF THIS SUBTITLE FOR RENEWABLE ENERGY CRE DITS DERIVED FROM 30
SOLAR ENERGY THAT IS GENERATED FROM QUA LIFYING DISTRIBUTED SOLAR 31
ENERGY GENERATING SY STEMS AND QUALIFYING UTILITY–SCALE SOLAR ENERGY 32
6 SENATE BILL 341

GENERATING SYSTEMS; AND 1

(ii) 2.5% from Tier 2 renewable sources; 2

(24) in 2029: 3

(i) AN AMOUNT EQUAL TO THE SUM OF: 4

1. 49.5% from Tier 1 renewable sources, including: 5

[1.] A. at least 12.5% derived from solar energy THAT IS 6
NOT GENERATED FROM SOURCES IDENTIFIED IN ITEM 2 OF THIS ITEM; 7

[2.] B. an amount set by the Commission under § 8
7–704.2(a) of this subtitle derived from offshore wind ene rgy, including at least 800 9
megawatts of Round 2 offshore wind projects; and 10

[3.] C. at least 1% derived from post –2022 geothermal 11
systems; and 12

2. AN AMOUNT SET BY THE COMMISSION UNDER § 13
7–709.2 OF THIS SUBTITLE FOR RENEWABLE ENERGY CRE DITS DERI VED FROM 14
SOLAR ENERGY THAT IS GENERATED FROM QUALI FYING DISTRIBUTED SO LAR 15
ENERGY GENERATING SY STEMS AND QUALIFYING UTILITY–SCALE SOLAR ENERGY 16
GENERATING SYSTEMS; AND 17

(ii) 2.5% from Tier 2 renewable sources; and 18

(25) in 2030 and later: 19

(i) AN AMOUNT EQUAL TO THE SUM OF: 20

1. 50% from Tier 1 renewable sources, including: 21

[1.] A. at least 14.5% derived from solar energy THAT IS 22
NOT GENERATED FROM SOURCES IDENTIFIED IN ITEM 2 OF THIS ITEM; 23

[2.] B. an amount set by the Commission under § 24
7–704.2(a) of this subtitle derived from offshore wind energy, including at least 1,200 25
megawatts of Round 2 offshore wind projects; and 26

[3.] C. at least 1% derived from post –2022 geothermal 27
systems; and 28

2. AN AMOUNT SET BY THE COMMISSION UNDER § 29
SENATE BILL 341 7

7–709.2 OF THIS SUBTITLE FOR RENEWABLE ENERGY CRE DITS DERIVED FROM 1
SOLAR ENERGY THAT IS GENERATED FROM QUALI FYING DISTRIBUTED SO LAR 2
ENERGY GENERATING SY STEMS AND QUALIFYING UTILITY–SCALE SOLAR ENERGY 3
GENERATING SYSTEMS; AND 4

(ii) 2.5% from Tier 2 renewable sources. 5

(e) (1) (I) The required percentage of an electric cooperative’s renewable 6
energy portfolio standard derived from solar energy shall be 2.5% in 2020 and later. 7

(II) AN ELECTRIC COOPERATI VE MAY MEET ITS RENE WABLE 8
ENERGY PORTFOLIO STA NDARD FOR SOLAR ENERGY BY AUTHORIZING THE 9
PURCHASE OF SREC–IIS THROUGH A PROCUREM ENT PROCESS ESTABLIS HED BY 10
THE COMMISSION UNDER SUBTITLE 12, PART V OF THIS TITLE. 11

(III) AN ELECTRIC COOPERATI VE THAT AUTHORIZES T HE 12
PURCHASE OF SREC–IIS THROUGH A PROCUREM ENT PROCESS ESTABLISH ED BY 13
THE COMMISSION UNDER SUBTITLE 12, PART V OF THIS TITLE MAY NO T RESCIND 14
THAT AUTHORIZATION. 15

(IV) BEGINNING JANUARY 1, 2028, AN ELECTRIC COOPERATIVE 16
THAT FAILS TO SATISF Y ITS SOLAR ENERGY R EQUIREMENTS UNDER TH IS 17
PARAGRAPH SHALL PAY A COMPLIANCE FEE EQUAL TO THE WEIGHTE D AVERAGE 18
DOLLAR PER KILOWATT–HOUR OF SREC–II CREDITS PROCURED UNDER SUBTITLE 19
12, PART V OF THIS TITLE FOR THE RELEVANT COMPLIANCE YEAR INSTEAD OF THE 20
COMPLIANCE FEE ESTABLISHED UNDER § 7–705 OF THIS SUBTITLE. 21

(2) (I) The required percentage of a municipal electric utility’s 22
renewable energy portfolio standard shall be[: 23

(i) in 2021: 24

1. 20.4% from Tier 1 renewable sources, including: 25

A. at least 1.95% derived from solar energy; and 26

B. an amount set by the Commission under § 7 –704.2(a) of 27
this subtitle, not to exceed 2.5%, derived from offshore wind energy; and 28

2. 2.5% from Tier 2 renewable sources; and 29

(ii) in 2022 and later, ] 20.4% from Tier 1 renewable sources, 30
including: 31

1. at least 1.95% derived from solar energy; and 32
8 SENATE BILL 341

2. an amount set by the Commission under § 7 –704.2(a) of 1
this subtitle, not to exceed 2.5%, derived from offshore wind energy. 2

(II) A MUNICIPAL ELECTRIC U TILITY MAY MEET ITS 3
RENEWABLE ENERGY PORTFOLIO STANDARD FOR SOLAR ENERGY BY AUTHORIZING 4
THE PURCHASE OF SREC–IIS THROUGH A PROCUREMENT PROCESS ESTABLISHED 5
BY THE COMMISSION UNDER SUBTITLE 12, PART V OF THIS TITLE. 6

(III) A MUNICIPAL ELECTRIC U TILITY THAT AUTHORIZ ES THE 7
PURCHASE OF SREC–IIS THROUGH A PR OCUREMENT PROCESS ES TABLISHED BY 8
THE COMMISSION UNDER SUBTITLE 12, PART V OF THIS TITLE MAY NO T RESCIND 9
THAT AUTHORIZATION. 10

(IV) BEGINNING JANUARY 1, 2028, A MUNICIPAL ELECTRIC 11
UTILITY THAT FAILS T O SATISFY ITS SOLAR ENERGY REQUIREMENTS UNDER THIS 12
SECTION SHALL PAY A COMP LIANCE FEE EQUAL TO THE WEIGHTED AVERAGE 13
DOLLAR PER KILOWATT–HOUR OF SREC–II CREDITS PROCURED UNDER SUBTITLE 14
12, PART V OF THIS TITLE FOR THE RELEVANT COMPLIANCE YEAR INSTEAD OF THE 15
COMPLIANCE FEE ESTABLISHED UNDER § 7–705 OF THIS SUBTITLE. 16

7–705. 17

(a) (1) Except as provided in paragraph (2) of this subsection, each electricity 18
supplier shall submit a report to the Commission each year in a form and by a date specified 19
by the Commission that: 20

(i) 1. demonstrates that the electricit y supplier has complied 21
with the applicable renewable energy portfolio standard under § 7–703 of this subtitle and 22
includes the submission of the required amount of renewable energy credits; or 23

2. demonstrates the amount of electricity sales by which the 24
electricity supplier failed to meet the applicable renewable energy portfolio standard; 25

(ii) documents the level of participation of minority business 26
enterprises and minorities in the activities that support the creation of renewable energy 27
credits used to satisfy the standard under § 7 –703 of this subtitle, including development, 28
installation, and operation of generating facilities that create credits; 29

(iii) documents the amounts and types of generation associated with 30
renewable energy credits purchased in compliance with § 7 –707(c) of this subtitle during 31
the reporting period; and 32

(iv) documents the amount of renewable energy certificates that do 33
not qualify as renewable energy credits as defined in § 7–701 of this subtitle, including, for 34
each certificate: 35
SENATE BILL 341 9

1. the energy source associated with the certificate, including 1
its location, when it was constructed, and which electric distribution system received the 2
energy; 3

2. whether the purchase of the certificate was bundled with 4
a power purchase agreement from the energy source associated with the certificate; 5

3. whether the certificate was purchased directly from the 6
operator of the energy source or through a third party; and 7

4. any other information required by the Commission. 8

(2) Paragraph (1)(iii) and (iv) of this subsection does not apply to: 9

(i) the Department of General Services’ sale of energy under § 10
7–704.4 of this subtitle; or 11

(ii) a community choice aggregator under § 7–510.3 of this title. 12

(b) (1) This subsection does not apply to a shortfall from: 13

(I) the required Tier 1 renewable sources that is to be derived from 14
post–2022 geothermal systems; OR 15

(II) THE REQUIRED SOLAR E NERGY TIER 1 RENEWABLE 16
SOURCES THAT IS TO BE DERIVED FROM QUALIFYING DISTRIBUTED SOLAR ENERGY 17
GENERATING SYSTEMS A ND QUALIFYING UTILIT Y–SCALE SOLAR ENERGY 18
GENERATING SYSTEMS. 19

(2) [If] BEGINNING OCTOBER 1, 2026, IF an electricity supplier OR 20
ELECTRIC COMPANY fails to comply with ITS OBLIGATION UNDER the renewable energy 21
portfolio standard for the applicable year, the electricity supplier OR ELECTRIC COMPANY 22
shall pay into the [Maryland Strategic Energy Investment Fund established under § 23
9–20B–05 of the State Government Article] ESCROW ACCOUNT ESTABLISHED UNDER § 24
7–1235 OF THIS TITLE: 25

(i) except as provided in item (ii) of this paragraph, a compliance fee 26
of: 27

1. the following amounts for each kilowatt –hour of shortfall 28
from required Tier 1 renewable sources other than the shortfall from the required Tier 1 29
renewable sources that is to be derived from solar energy CONNECTED TO THE 30
DISTRIBUTION SYSTEM IN THE STATE: 31

A. 4 cents through 2016; 32
10 SENATE BILL 341

B. 3.75 cents in 2017 and 2018; 1

C. 3 cents in 2019 through 2023; 2

D. 2.75 cents in 2024; 3

E. 2.5 cents in 2025; 4

F. 2.475 cents in 2026; 5

G. 2.45 cents in 2027; 6

H. 2.25 cents in 2028 and 2029; and 7

I. 2.235 cents in 2030 and later; 8

2. EXCEPT AS PROVIDED U NDER PARAGRAPH (1)(II) OF 9
THIS SUBSECTION , the following amounts for each kilowatt –hour of shortfall from 10
required Tier 1 renewable sources that is to be derived from solar energy: 11

A. 45 cents in 2008; 12

B. 40 cents in 2009 through 2014; 13

C. 35 cents in 2015 and 2016; 14

D. 19.5 cents in 2017; 15

E. 17.5 cents in 2018; 16

F. 10 cents in 2019; 17

G. 10 cents in 2020; 18

H. 8 cents in 2021; 19

I. 6 cents in 2022; 20

J. 6 cents in 2023; 21

K. 6 cents in 2024; 22

L. 5.5 cents in 2025; 23

M. 4.5 cents in 2026; 24

SENATE BILL 341 11

N. 3.5 cents in 2027; 1

O. 3.25 cents in 2028; 2

P. 2.5 cents in 2029; and 3

Q. 2.25 cents in 2030 and later; and 4

3. 1.5 cents for each kilowatt–hour of shortfall from required 5
Tier 2 renewable sources; or 6

(ii) for industrial process load: 7

1. for each kilowatt –hour of shortfall from required Tier 1 8
renewable sources, a compliance fee of: 9

A. 0.8 cents in 2006, 2007, and 2008; 10

B. 0.5 cents in 2009 and 2010; 11

C. 0.4 cents in 2011 and 2012; 12

D. 0.3 cents in 2013 and 2014; 13

E. 0.25 cents in 2015 and 2016; and 14

F. except as provided in paragraph (3) of this subsection, 0.2 15
cents in 2017 and later; and 16

2. nothing for any shortfall from required Tier 2 renewable 17
sources. 18

(3) For industrial process load, the compliance fee for each kilowatt –hour 19
of shortfall from required Tier 1 renewable sources is nothing for the year following any 20
year during which, after final calculations, the net rate impact per megawatt –hour from 21
Round 1 offshore wind projects exceeded $1.65 in 2012 dollars. 22

(b–1) If an electricity supplier fails to comply with the renewable energy portfolio 23
standard that is required to be derived from post –2022 geothermal systems for the 24
applicable year, the electricity supplier shall pay into the [Maryland Strategic Energy 25
Investment Fund established under § 9–20B–05 of the State Government Article] ESCROW 26
ACCOUNT ESTABLISHED UNDER § 7–1235 OF THIS TITLE a compliance fee of the 27
following amounts for each kilowatt–hour of shortfall from required post–2022 geothermal 28
systems: 29

(1) 10 cents in 2023 through 2025; 30

12 SENATE BILL 341

(2) 9 cents in 2026; 1

(3) 8 cents in 2027; and 2

(4) 6.5 cents in 2028 and later. 3

7–709.2. 4

(A) (1) ON OR BEFORE JANUARY 1, 2028, AND BEFORE EACH 5
PROCUREMENT ESTABLISHED UNDER § 7–1232 OF THIS TITLE , THE COMMISSION 6
SHALL DETERMINE: 7

(I) THE TOTAL NUMBER OF SRECS AND SREC–IIS 8
GENERATED BY SOLAR ENERGY GENERATING SYSTEMS IN THE STATE DURING THE 9
PREVIOUS YEAR; AND 10

(II) THE AMOUNT OF ADDITIONAL SOLAR ENERGY GENERATION 11
NEEDED, IF ANY , TO MEET THE SOLAR PO RTION OF THE RENEWAB LE ENERGY 12
PORTFOLIO STANDARD FOR THE CURRENT YEAR. 13

(2) AFTER MAKING THE DETERMINATIONS UNDER PARAGRAPH (1) OF 14
THIS SUBSECTION , THE COMMISSION SHALL REQU IRE ELECTRIC COMPANI ES TO 15
PROCURE THE TOTAL NU MBER OF SRECS AND SREC–IIS GENERATED DURING 16
THAT COMPLIANCE YEAR ON A DATE , DETERMINED BY THE COMMISSION, THAT IS 17
AFTER THE DATE OF TH E LAST MONTH IN WHIC H SRECS AND SREC–IIS ARE 18
ISSUED FOR THE FINAL MONTH OF THAT COMPLIANCE YEAR. 19

(3) EACH YEAR THE COMMISSION, IN CONSULTATION WITH THE 20
ADMINISTRATOR OF THE ESCROW ACC OUNT ESTABLISHED IN § 7–1235 OF THIS 21
TITLE, SHALL DETERMINE EACH ELECTRIC COMPANY ’S SREC AND SREC–II 22
OBLIGATION BASED ON THE TOTAL RETAIL ELE CTRICITY SALES IN TH E ELECTRIC 23
COMPANY’S SERVICE TERRITORY DURING THE PREVIOUS YEAR. 24

(B) (1) THIS SUBSECTION APPL IES ONLY TO THE PROC UREMENT OF 25
SRECS AND SREC–IIS GENERATED BY SOLAR ENERGY GENERATING SY STEMS 26
THAT BEGAN OPERATION BEFORE JANUARY 1, 2028. 27

(2) THE COMMISSION SHALL ESTA BLISH AN ANNUAL PROC ESS FOR 28
THE PROCUREMENT OF A LL AVAILABLE SRECS AND SREC–IIS FROM SOLAR 29
ENERGY GENERATING SYSTEMS THAT BEGAN OPERATION BEFORE JANUARY 1, 2028. 30

(3) THE PROCESS SHALL: 31

(I) DETERMINE THE AMOUNT OF SRECS AND SREC–IIS 32
SENATE BILL 341 13

NEEDED TO BE PROCURED IN EACH PROCUREMENT; 1

(II) OCCUR FOLLOWING THE LAST MONTH IN WHICH SRECS 2
AND SREC–IIS ARE GENERATED FOR THAT YEAR; AND 3

(III) ENSURE THAT THE SRECS AND SREC–IIS PROCURED ARE 4
EQUAL TO THE TOTAL SRECS AND SREC–IIS GENERATED IN THAT YEAR. 5

(4) THE PRICE FOR AN SREC OR SREC–II PROCURED THROUGH THE 6
PROCESS REQUIRED IN PARAGRAPH (2) OF THIS SUBSECTION SHALL BE EQUAL TO 7
THE ALTERNATIVE COMPLIANCE PAYMENT FOR SOLAR ENERGY UNDER § 7–705 OF 8
THIS SUBTITLE FOR TH E RELEVANT RENEWABLE ENERGY PORTFOLIO STA NDARD 9
COMPLIANCE YEAR. 10

7–1230. RESERVED. 11

7–1231. RESERVED. 12

PART V. SOLAR ENERGY. 13

7–1232. 14

(A) (1) BEGINNING JANUARY 1, 2028, AND AT INTERVALS OF NOT MORE 15
THAN 18 MONTHS UNTIL JANUARY 1, 2036, IN ACCORDANCE WITH THE PROGRAMS 16
ESTABLISHED IN §§ 7–1233 AND 7–1234 OF THIS SUBTITLE , THE COMMISSION, BY 17
ORDER OR REGULATION, SHALL ISSUE A SOLICITATION FOR APPLICATIONS FOR THE 18
CONSTRUCTION OF SOLA R ENERGY GENERATING SYSTEMS ELIGIBLE FOR 19
INCLUSION IN THE REN EWABLE ENERGY PORTFO LIO STANDARD THAT , IN TOTAL, 20
WILL INCREASE THE GE NERATION OF SOLAR EN ERGY IN THE STATE BY 4,000 21
MEGAWATTS OF GENERATING CAPACITY IN ADDITION TO THE TOTAL GENERAT ING 22
CAPACITY OF THE SOLA R GENERATING SYSTEMS IN OPERATION IN THE STATE ON 23
JANUARY 1, 2028, WITH THE ADDITIONAL GENERATION CAPACITY TO CONSIST OF: 24

(I) 2,000 MEGAWATTS FROM QUALIFYING DISTRIBUTED SOLAR 25
ENERGY GENERATING SYSTEMS; AND 26

(II) 2,000 MEGAWATTS FROM QUALI FYING UTILITY –SCALE 27
SOLAR ENERGY GENERATING SYSTEMS. 28

(2) THE COMMISSION, BY ORDER OR REGULATION, SHALL ESTABLISH 29
A PROCESS BY WHICH T HE NUMBER OF SRECS ELECTRIC COMPANIES MUST 30
PROCURE UNDER § 7–709.2 OF THIS TITLE MAY BE REDUCED: 31

14 SENATE BILL 341

(I) BY AN AMOUNT EQUAL T O THE NUMBER OF SRECS 1
PROCURED DURING THE 2027 COMPLIANCE YEAR; AND 2

(II) BASED ON A METHOD DETERMINED BY THE COMMISSION. 3

(B) THE COMMISSION, BY ORDER OR REGULATI ON, SHALL ESTABLISH A 4
PROCESS TO ADJUST THE RENEWABLE ENERGY PORTFOLIO STANDARD FOR SOLAR 5
ENERGY EACH YEAR TO ACCOUNT FOR THE PROJ ECTED NUMBER OF SRECS AND 6
SREC–IIS ANTICIPATED TO BE PROCURED UNDER § 7–709.2 OF THIS TITLE , AND 7
ANY OTHER ADJUSTMENTS THE COMMISSION CONSIDERS NECESSARY. 8

(C) THE COMMISSION MAY CONTRA CT FOR THE SERVICES OF 9
INDEPENDENT CONSULTA NTS OR EXPERTS IN TH E IMPLEMENTATION OF THE 10
PROVISIONS OF THIS PART. 11

(D) A DEBT, AN OBLIGATION , OR A LIABILITY OF AN Y SOLAR ENERGY 12
GENERATING SYSTEMS C ONSTRUCTED UNDER THI S SUBTITLE MAY NOT BE 13
CONSIDERED A DEBT, AN OBLIGATION, OR A LIABILITY OF THE STATE. 14

7–1233. 15

(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 16
INDICATED. 17

(2) “ADMINISTRATIVELY DETE RMINED INCENTIVE ” MEANS THE 18
MONETARY VALUE OF AN SREC–II GENERATED B Y A QUALIFYING DISTR IBUTED 19
SOLAR ENERGY GENERATING SYSTEM UNDER THE PROGRAM. 20

(3) “CAPACITY BLOCK ” MEANS THE MAXIMUM AM OUNT OF 21
GENERATING CAPACITY , MEASURED IN MEGAWATT S OF ALTERNATING CUR RENT, 22
THAT THE COMMISSION DETERMINES MAY BE ALLOTTED TO A SPECIFIC MARKET 23
SEGMENT FOR ANY GIVEN INCENTIVE YEAR. 24

(4) “COMMUNITY SOLAR ENERG Y GENERATING SYSTEM ” HAS THE 25
MEANING STATED IN § 7–306.2 OF THIS TITLE. 26

(5) “ELIGIBLE CUSTOMER–GENERATOR” HAS THE MEANING STAT ED 27
IN § 7–306 OF THIS TITLE. 28

(6) “MARKET SEGMENT ” MEANS THE GROUP CLAS SIFICATION FOR 29
QUALIFYING DISTRIBUT ED SOLAR ENERGY GENE RATING SYSTEMS UNDER THE 30
PROGRAM. 31

SENATE BILL 341 15

(7) “PROGRAM” MEANS THE DISTRIBUTED SOLAR FACILITIES 1
INCENTIVE PROGRAM. 2

(8) “PROJECT OFF –TAKER” MEANS THE END USER O F SREC–IIS 3
THAT ARE GENE RATED BY A QUALIFYIN G DISTRIBUTED SOLAR ENERGY 4
GENERATING SYSTEM. 5

(9) “QUALIFYING DISTRIBUTE D SOLAR ENERGY GENER ATING 6
SYSTEM” HAS THE MEANING STATED IN § 7–701(L–1) OF THIS TITLE. 7

(B) (1) THERE IS A DISTRIBUTED SOLAR FACILITIES INCENTIVE 8
PROGRAM. 9

(2) THE COMMISSION SHALL ADMINISTER THE PROGRAM. 10

(3) ON OR BEFORE JANUARY 1, 2028, IN ACCORDANCE WITH § 11
7–1232, THE PROGRAM SHALL BEGIN ACCEPTING APPLICATIONS FROM QUALIFYING 12
DISTRIBUTED SOLAR ENERGY GENERATING SYSTEMS WITHIN A CAPACITY BLOCK ON 13
A FIRST–COME, FIRST–SERVED BASIS. 14

(C) ON OR BEFORE JANUARY 1, 2035, THE PROGRAM SHALL PROVIDE 15
INCENTIVES FOR THE DEVELOPMENT OF NEW GENERATION CAPACITY OF AT LEAST 16
2,000 MEGAWATTS OF SOLAR ENERGY FROM OWNERS OF QUALIFYING DISTRIBUTED 17
SOLAR ENERGY GENERATING SYSTEMS. 18

(D) (1) THE COMMISSION SHALL ESTABLISH ELIGIBILITY CRITERIA AND 19
AN APPLICATION PROCE SS FOR OWNERS OF DIS TRIBUTED SOLAR ENERG Y 20
GENERATING SYSTEMS TO BE QUALIFIED UNDER THE PROGRAM. 21

(2) IN ADDITION TO ANY QU ALIFICATION REQUIREM ENTS 22
ESTABLISHED BY THE COMMISSION, A QUALIFYING DISTRIB UTED SOLAR ENERGY 23
GENERATING SYSTEM SHALL: 24

(I) BE CONNECTED TO THE ELECTRIC DISTRIBUTION SYSTEM 25
SERVING MARYLAND; 26

(II) BE ELIGIBLE FOR INCL USION IN THE RENEWAB LE ENERGY 27
PORTFOLIO STANDARD; 28

(III) BE PLACED IN SERVICE AFTER DECEMBER 31, 2027; AND 29

(IV) CONTRIBUTE TOWARD TH E STATE’S ENERGY SUPPLY 30
NEEDS. 31
16 SENATE BILL 341

(E) (1) ON OR BEFORE OCTOBER 1, 2027, AND EVERY 3 YEARS 1
THEREAFTER, THE COMMISSION SHALL ESTA BLISH AN ADMINISTRAT IVELY 2
DETERMINED INCENTIVE AND ANNUAL C APACITY BLOCK FOR EA CH OF THE 3
FOLLOWING MARKET SEGMENTS UNDER THE PROGRAM: 4

(I) BEHIND–THE–METER RESIDENTIAL; 5

(II) BEHIND–THE–METER NONRESIDENTIAL; 6

(III) COMMUNITY SOLAR; AND 7

(IV) ANY OTHER MARKET SEG MENT DETERMINED BY T HE 8
COMMISSION. 9

(2) THE COMMISSION MAY ADJUST THE ADMINISTRATIVELY 10
DETERMINED INCENTIVE AND CAPACITY BLOCKS NOT EARLIER THAN 90 DAYS 11
AFTER PROVIDING PUBLIC NOTICE OF THE ACTION: 12

(I) IF THE COMMISSION FINDS THAT AN ADJUSTMENT IS 13
NECESSARY; OR 14

(II) TO ADDRESS CHANGES IN LAW OR POLICY. 15

(3) IN ADDITION TO THE REQUIREMENTS OF PARAGRAPH (1) OF THIS 16
SUBSECTION, THE COMMISSION MAY REVIEW AND ADJUST THE ADMINISTRATIVELY 17
DETERMINED INCENTIVE WITHIN 6 MONTHS AFTER MISSING A CAPACITY BLOCK. 18

(4) SUBJECT TO THE PROVISIONS OF PARAGRAPHS (1) THROUGH (3) 19
OF THIS SUBSECTION , THE ADMINISTRATIVELY DETERMINED INCENTIVE FOR A 20
QUALIFYING DISTRIBUTED SOLAR ENERGY GENE RATING SYSTEM SHALL BE FIXED 21
FOR A PERIOD OF 15 YEARS AT THE AMOUNT THAT WAS ESTABLISHED FOR THE 22
CAPACITY BLOCK IN THE YEAR THAT THE QUALIFYING DISTRIBUTED SOLAR ENERGY 23
GENERATING SYSTEM APPLIED FOR THE CAPACITY BLOCK. 24

(5) (I) IN ESTABLISHING THE A DMINISTRATIVELY DETE RMINED 25
INCENTIVE AND ANNUAL CAPACITY BLOCK UNDER THE PROGRAM, THE 26
COMMISSION SHALL BALANCE THE NEED FOR CONTINUED MARKET DEVELOPMENT 27
FOR EACH MARKET SEGMENT WHILE LIMITING THE NET RESIDENTIAL R ATEPAYER 28
COST TO NOT MORE THAN 5% OF THE AVERAGE ANNUAL ELECTRIC BILL OVER THE 29
DURATION OF THE PROGRAM. 30

(II) IN CALCULATING THE NET RESIDENTIAL RATEPAYER COST, 31
SENATE BILL 341 17

THE COMMISSION SHALL TAKE INTO ACCOUNT: 1

1. THE COST OF ANY ADMI NISTRATIVELY DETERMINED 2
INCENTIVE SREC–IIS REQUIRED TO BE PURCHASED BY ELECTRIC COMPANIES; AND 3

2. THE BENEFITS ATTRIBUTABLE TO THE PROGRAM, AS 4
DETERMINED BY THE COMMISSION, INCLUDING: 5

A. ENERGY GENERATED; 6

B. THE VALUE OF ANY RED UCTION IN CAPACITY 7
PURCHASES BY LOAD –SERVING ENTITIES IN THE STATE THAT RESULT FRO M THE 8
QUALIFYING DISTRIBUT ED SOLAR ENERGY GENE RATING SYSTEMS AUTHO RIZED 9
UNDER THE PROGRAM; 10

C. AVOIDED TRANSMISSION AND DISTRIBUTION LINE 11
AND CAPACITY AUCTION COSTS; AND 12

D. SOCIETAL COSTS AND BENEFITS. 13

(F) IN DETERMINING THE AD MINISTRATIVELY DETER MINED INCENTIVE 14
FOR EACH MARKET SEGMENT, THE COMMISSION: 15

(1) MAY CONSIDER PRICE DIFFERENTIALS BASED ON: 16

(I) FEDERAL POLICIES AND PROGRAMS RELATING TO SOLAR 17
ENERGY GENERATING SYSTEMS; 18

(II) THE COST TO CONSTRUC T AND FINANCE A SOLA R ENERGY 19
GENERATING SYSTEM; AND 20

(III) ANY OTHER CRITERIA DETERMINED BY THE COMMISSION; 21

(2) SHALL ESTABLISH MONE TARY VALUES TH AT ENCOURAGE 22
MARKET DEVELOPMENT WHILE BALANCING RATEPAYER COSTS; AND 23

(3) SHALL STRIVE TO ACHIEVE MARKET DIVERSITY. 24

(G) IN ESTABLISHING THE C APACITY BLOCK FOR EA CH MARKET SEGMENT 25
UNDER SUBSECTION (E)(1) OF THIS SECTION, THE COMMISSION SHALL: 26

(1) ENABLE MEANINGFUL AND C ONTINUED MARKET GROW TH FOR 27
EACH MARKET SEGMENT; 28
18 SENATE BILL 341

(2) CONSIDER THE VALUE OF REDUCING ELECTRICITY DEMAND AND 1
THE COST OF INSTALLI NG GENERATION CAPACI TY ON THE TRANSMISSI ON AND 2
DISTRIBUTION SYSTEMS; AND 3

(3) FOR EACH MARKET SEGMENT: 4

(I) ENSURE THAT THE NEXT CAPACITY BLOCK IS ESTABLISHED 5
AS SOON AS REASONABL Y POSSIBLE AFTER THE CURRENT CAPACITY BLO CK IS 6
FULLY RESERVED; AND 7

(II) MAINTAIN A CAPACITY BLOCK WAITLIST UNTIL THE NEXT 8
CAPACITY BLOCK IS ESTABLISHED AND ALLOW THE WAITLISTED PROJECTS TO HAVE 9
PRIORITY IN THE SUBSEQUENT CAPACITY BLOCK. 10

(H) (1) A QUALIFYING DISTRIBUT ED SOLAR ENERGY GENE RATING 11
SYSTEM THAT GENERATES SREC–IIS UNDER THIS SECTION MAY NOT RECEIVE ANY 12
OTHER EQUIVALENT SOLAR ENERGY CREDITS. 13

(2) EXCEPT AS OTHERWISE PROVIDED IN THIS SEC TION, THE 14
PROVISIONS OF § 7–703 OF THIS TITLE APPLY TO ENERGY GENERATED BY A 15
QUALIFYING DISTRIBUT ED SOLAR ENERGY GENE RATING SYSTEM UNDER THE 16
PROGRAM. 17

(3) AN SREC–II GENERATED BY A QUALIFYING DISTRIBUTED SOLAR 18
ENERGY GENERATING SYSTEM UNDER THE PROGRAM MAY BE INCLUD ED IN 19
MEETING THE RENEWABLE ENERGY PORTFOLIO STANDARD ONLY FOR THE YEAR IN 20
WHICH THE SREC–II IS GENERATED OR THE FOLLOWING YEAR, AS DETERMINED BY 21
THE COMMISSION. 22

7–1234. 23

(A) (1) IN THIS SECTION THE F OLLOWING WORDS H AVE THE MEANINGS 24
INDICATED. 25

(2) “PROGRAM” MEANS THE UTILITY–SCALE SREC–II PROGRAM. 26

(3) “QUALIFYING UTILITY –SCALE SOLAR ENERGY G ENERATING 27
SYSTEM” HAS THE MEANING STATED IN § 7–701(L–2) OF THIS TITLE. 28

(B) (1) THERE IS A UTILITY–SCALE SREC–II PROGRAM. 29

(2) THE COMMISSION SHALL ADMINISTER THE PROGRAM. 30
SENATE BILL 341 19

(C) BY JANUARY 1, 2035, THE PROGRAM SHALL PROVIDE INCENTIVES FOR 1
THE DEVELOPMENT OF A T LEAST 2,000 MEGAWATTS OF SOLAR E NERGY 2
GENERATING CAPACITY BY QUALIFYING UTILIT Y–SCALE SOLAR ENERGY 3
GENERATING SYSTEMS. 4

(D) A QUALIFYING UTILITY –SCALE SOLAR ENERGY G ENERATING SYSTEM 5
UNDER THE PROGRAM SHALL: 6

(1) HAVE A GENERATING CA PACITY THAT IS GREAT ER THAN 5 7
MEGAWATTS, AS MEASURED IN DIREC T CURRENT , OR ANOTHER GENERATIN G 8
CAPACITY AS SPECIFIED BY THE COMMISSION BUT AT LEAST 5 MEGAWATTS; 9

(2) BE CONNECTED TO THE ELECTRIC TRANSMISSIO N SYSTEM 10
SERVING MARYLAND; 11

(3) BE ELIGIBLE FOR INCL USION IN THE RENEWAB LE ENERGY 12
PORTFOLIO STANDARD; 13

(4) BE NEWLY CONSTRUCTED OR RECONSTRUCTED; AND 14

(5) MEET ANY OTHER CRITERIA DEVELOPED BY THE COMMISSION. 15

(E) (1) BY REGULATION OR ORDER, THE COMMISSION SHALL ESTABLISH 16
A COMPETITIVE SOLICI TATION PROCESS FOR T HE SELECTION OF PROJ ECTS FOR 17
THE CONSTRUCTION OF QUALIFYING UTILITY–SCALE SOLAR ENERGY GENERATING 18
SYSTEMS UNDER THE PROGRAM. 19

(2) THE SOLICITATION PROC ESS SHALL REQUIRE TH AT 20
APPLICATIONS FOR THE CONSTRUCTION OF QUAL IFYING UTILITY –SCALE SOLAR 21
ENERGY GENERATING SYSTEMS INCLUDE: 22

(I) A PROPOSED SREC–II PRICING SCHEDULE THA T 23
SPECIFIES: 24

1. A FIXED RATE OR RATE SCHEDULE; AND 25

2. A FIXED PRICE FOR TH E ENVIRONMENTAL 26
ATTRIBUTES OF THE ENERGY GENERATED BY THE SYSTEM; AND 27

(II) A CERTIFICATION THAT , IF SELECTED UNDER TH E 28
PROGRAM, THE CONSTRUCTION OF THE QUALIFYING UTILI TY–SCALE SOLAR 29
ENERGY GENERATING SYSTEM SHALL INCLUDE A COMMUNITY BENEFIT AGREEMENT 30
20 SENATE BILL 341

AS ESTABLISHED UNDER § 7–1202 OF THIS SUBTITLE. 1

(F) THE COMMISSION SHALL: 2

(1) IN ACCORDANCE WITH § 7–1232 OF THIS SUBTITLE, DETERMINE A 3
SCHEDULE FOR THE PRO CUREMENT OF QUALIFYI NG UTILITY –SCALE SOLAR 4
ENERGY GENERATING SYSTEMS UNDER THE PROGRAM THAT MEETS THE JANUARY 5
1, 2035, GOAL WHILE BALANCING RATEPAYER COSTS; AND 6

(2) ADOPT REGULATIONS TO IMPLEMENT THE PROGRAM, INCLUDING 7
REQUIREMENTS FOR: 8

(I) CERTIFICATION AS A Q UALIFYING UTILITY –SCALE SOLAR 9
ENERGY GENERATING SYSTEM; AND 10

(II) ANY MONEY TO BE HELD IN ESCROW DURING THE BIDDING 11
PROCESS. 12

(G) (1) BEGINNING JANUARY 1, 2027, AND EVERY 18 MONTHS 13
THEREAFTER, THE COMMISSION SHALL COMM ENCE SOLICITATIONS F OR THE 14
AWARD OF PROJECTS UNDER THE PROGRAM. 15

(2) THE SOLICITATION SHALL: 16

(I) AWARD CONTRACTS FOR THE CONSTRUCTION OF 17
QUALIFYING UTILITY–SCALE SOLAR ENERGY GENERATING SYSTEMS FOR NOT LESS 18
THAN 205 MEGAWATTS PER YEAR FOR 8 YEARS AFTER THE FIRST CONTRACTS ARE 19
AWARDED; 20

(II) AWARD CONTRACTS WITH IN 6 MONTHS AFTER EACH 21
SOLICITATION; 22

(III) ENSURE AWARDED PROJE CTS RECEIVE A RENEWA BLE 23
ENERGY INCENTIVE PAY MENT, IN THE FORM OF AN SREC–II VALUE PER 24
MEGAWATT–HOUR FOR THE ENVIRON MENTAL ATTRIBUTE PRO DUCED BY THE 25
QUALIFYING UTILITY–SCALE SOLAR ENERGY GENERATING SYSTEM, AND ANY OTHER 26
BENEFITS TO THE STATE PROVIDED BY THE SYSTEM, AS DETERMINED BY THE 27
COMMISSION; 28

(IV) ENSURE THAT THE LENGTH OF AN AWARD IS SUFFICIENT TO 29
ENCOURAGE LOW FINANC ING RATES , PROVIDE REASONABLE R ISKS TO 30
RATEPAYERS, AND ENABLE THE DEVEL OPMENT OF AFF ORDABLE RENEWABLE 31
ENERGY; 32
SENATE BILL 341 21

(V) MITIGATE PRICE AND DELIVERY RISKS FOR CONSUMERS; 1

(VI) INCLUDE REQUIREMENTS DESIGNED TO ENSURE 2
SUCCESSFUL COMPLETIO N OF PROJECTS , INCLUDING THE IMPOSI TION OF 3
APPROPRIATE ESCROW F EES, BID MATURITY REQUIRE MENTS, REQUIRED 4
INTERCONNECTION MILESTONES, AND COMMERCIAL OPERATION MILESTONES; 5

(VII) ENSURE THE RECOGNITI ON OF THE ENVIRONMEN TAL AND 6
PUBLIC HEALTH BENEFI TS OF PROJECTS LOCAT ED ON BROWNFIELDS OR 7
CONTAMINATED SITES; 8

(VIII) BE OPEN ON A NONDISC RIMINATORY BASIS TO ANY 9
PROJECT MEETING THE CRITERIA OF THIS SUBTITLE; AND 10

(IX) INCLUDE ANY OTHER RE QUIREMENTS DEVELOPED BY THE 11
COMMISSION. 12

(3) THE COMMISSION MAY: 13

(I) ESTABLISH CONFIDENTIAL HIGH – AND LOW –APPLICATION 14
THRESHOLDS BEFORE CO NDUCTING A SOLICITAT ION, PROVIDED THAT THE 15
THRESHOLDS PROMOTE FISCAL RESPONSIBILITY AND ENSURE THE LIKELIHOOD OF 16
SUCCESSFUL PROJECTS, AS DETERMINED BY THE COMMISSION; 17

(II) MAY INCLUDE A CAP ON THE RENEWABLE ENERGY 18
INCENTIVE UNDER PARAGRAPH (2)(III) OF THIS SUBSECTION; AND 19

(III) PROCURE MORE THAN TH E MINIMUM QUANTITY O F SOLAR 20
ENERGY REQUIRED UNDE R THE PROGRAM IF APPLICATIO NS ARE BELOW THE 21
LOW–APPLICATION THRESHOLD ESTABLISHED IN ITEM (I) OF THIS PARAGRAPH. 22

(4) BEFORE ISSUING A SOLI CITATION FOR PROJECT S UNDER THIS 23
SECTION, THE COMMISSION SHALL REQUEST THE COMMISSIONER OF LABOR AND 24
INDUSTRY TO DETERMINE THE PREVAILING WAGE RATE FOR EACH CLASSIFICATION 25
OF WORKER REQUIRED TO PERFORM WORK ON THE PROJECT IN ORDER TO INCLUDE 26
THAT DETERMINATION IN THE BIDDING PROCESS. 27

(5) THE COMMISSION, AT THE END OF THE SO LICITATION PROCESS, 28
SHALL: 29

(I) RANK ALL APPLICATION S RECEIVED BASED ON THE 30
ESTIMATED COST OF THE PROJECT OR ESTIMATED COST BY CATEGORY; 31
22 SENATE BILL 341

(II) SELECT ONE OR MORE PROJECTS IN RANKED ORDER, UP TO 1
THE LIMIT ESTABLISHED BY THE COMMISSION; AND 2

(III) ADJUST THE NUMBER OF PROJECTS SELECTED IF THE 3
COSTS ARE ABOVE OR B ELOW THE CONFIDENTIAL PREDETERMINED THRESHOLDS 4
ESTABLISHED UNDER PARAGRAPH (3) OF THIS SECTION. 5

(H) (1) THE COMMISSION, BY ORDER, SHALL APPROVE, CONDITIONALLY 6
APPROVE, OR DENY ONE OR MORE PROJECTS UNDER THIS SECTION WITHIN 6 7
MONTHS AFTER THE CLOSE OF THE SOLICITATION PERIOD. 8

(2) AN ORDER APPROVING A PROJECT UNDER THIS SECTION SHALL: 9

(I) SPECIFY THE SREC–II FIXED PRICING SCHEDU LE FOR 10
ENERGY GENERATED BY THE PROJECT; 11

(II) SPECIFY THE DURATION OF THE SREC–II FIXED PRICING 12
SCHEDULE, NOT TO EXCEED 15 YEARS; 13

(III) SPECIFY THE TOTAL NU MBER OF SREC–IIS THAT MAY BE 14
SOLD EACH YEAR FROM THE QUALIFYING UTILI TY–SCALE SOLAR ENERGY 15
GENERATING SYSTEM; 16

(IV) PROVIDE THAT NO PAYMENT MAY BE MADE FOR AN 17
SREC–II UNTIL THE QUALIFYING UTILITY–SCALE SOLAR ENERGY G ENERATING 18
SYSTEM IS OPERATIONAL AND GENERATING ENERGY; AND 19

(V) PROVIDE THAT THE STATE SHALL BE HELD HARMLESS FOR 20
ANY COST OVERRUNS AS SOCIATED WITH THE CO NSTRUCTION AND OPERAT ION OF 21
THE QUALIFYING UTILITY–SCALE SOLAR ENERGY GENERATING SYSTEM. 22

(3) A PROJECT APPROVED UNDER THIS SECTION SHALL REQUIRE: 23

(I) COMPLIANCE WITH THE APPLICABLE PREVAILIN G WAGE 24
RATES DETERMINED UNDER THIS SECTION; 25

(II) COMPLIANCE WITH THE REQUIREMENTS OF §§ 17–219 26
THROUGH 17–221 OF THE STATE FINANCE AND PROCUREMENT ARTICLE; AND 27

(III) THE CONTRACTORS AND SUBCONTRACTORS TO IN CLUDE 28
THE REQUIREMENTS OF THIS SECTION IN ANY CONTRACTS FOR ANY OT HER 29
SUBCONTRACTORS BELOW THE PRIME CONTRACTORS OR SUBCONTRACTORS. 30
SENATE BILL 341 23

(4) THE COMMISSION, IN CONSULTATION WITH THE COMMISSIONER 1
OF LABOR AND INDUSTRY, SHALL ADOPT REGULATI ONS TO CARRY OUT THI S 2
SUBSECTION, INCLUDING: 3

(I) PROVISIONS RELATING TO THE REPORTING OF 4
NONCOMPLIANCE OR VIOLATIONS OF THE PREVAILING WAGE REQUIREMENTS; 5

(II) PROVISIONS ALLOWING THE USAGE OF THE ESC ROW 6
ACCOUNT UNDER THIS SUBTITLE TO ISSUE BACKPAY TO WORKERS; AND 7

(III) PROVISIONS ESTABLISH ING LIQUIDATED DAMAG ES 8
EQUIVALENT TO THE PROVISIONS IN §§ 17–220 AND 17–222 OF THE STATE FINANCE 9
AND PROCUREMENT ARTICLE. 10

(I) (1) UNDER THE PROGRAM, A QUALIFYING UTILITY –SCALE SOLAR 11
ENERGY GENERATING SYSTEM SHALL GENERATE ONLY SREC–IIS. 12

(2) A QUALIFYING UTILITY –SCALE SOLAR ENERGY G ENERATING 13
SYSTEM THAT GENERATES SREC–IIS UNDER THE PROGRAM MAY NOT RECEIVE ANY 14
EQUIVALENT RENEWABLE ENERGY CREDITS OF ANY TYPE. 15

(3) EXCEPT AS OTHERWISE P ROVIDED UNDER THIS S ECTION, THE 16
PROVISIONS OF § 7–703 OF THIS TITLE APPLY TO SREC–IIS GENERATED UNDER 17
THE PROGRAM. 18

(4) UNDER THE PROGRAM: 19

(I) AN SREC–II GENERATED BY A QUALIFYING UTILITY–SCALE 20
SOLAR ENERGY GENERATING SYSTEM MAY BE APPLIED ONLY TOWARD MEETING THE 21
RENEWABLE ENERGY POR TFOLIO STANDARD FOR THE YEAR IN WHICH TH E 22
SREC–II IS GENERATED OR THE FOLLOWING YEAR, ON DETERMINATION BY THE 23
COMMISSION; AND 24

(II) AN OWNER OF A QUALIF YING UTILITY –SCALE SOLAR 25
ENERGY GENERATING SY STEM PRODUCING SREC–IIS MAY NOT SELL , ALIENATE, 26
OR DISPOSE OF ANY OF THE ENVIRONMENTAL ATTRIBUTES ASSOCIATED WITH THE 27
ENERGY GENERATED BY THE SYSTEM. 28

(J) (1) AN APPLICATION FOR A QUALIFYING UTILITY –SCALE SOLAR 29
ENERGY GENERATING SY STEM UNDER THIS SECT ION SHALL BE SUBJECT TO A 30
COMMUNITY BENEFIT AGREEMENT. 31

24 SENATE BILL 341

(2) A COMMUNITY BENEFIT AGREEMENT SHALL: 1

(I) PROMOTE INCREASED OPPORTUNITIES FOR LOCAL, SMALL, 2
MINORITY, WOMEN–OWNED, AND VETERAN –OWNED BUSINESSES IN THE CLEAN 3
ENERGY INDUSTRY; 4

(II) ENSURE THE TIMELY , SAFE, AND EFFICIENT COMPLE TION 5
OF THE PROJECT BY FACILITATING THE HIRING OF HIGHLY SKILLED WORKERS WHO 6
SHALL BE PAID NOT LE SS THAN THE PREVAILI NG WAGE, AS DETERMINED BY THE 7
COMMISSIONER OF LABOR AND INDUSTRY UNDER TITLE 17, SUBTITLE 2 OF THE 8
STATE FINANCE AND PROCUREMENT ARTICLE; 9

(III) GUARANTEE THAT THE CONSTRUCTION WORK ASSOCIATED 10
WITH THE PROJECT IS SUBJECT TO AN AGREEMENT THAT: 11

1. ESTABLISHES THE TERMS AND CONDITIONS OF 12
EMPLOYMENT AT THE CONSTRUCTION SITE; 13

2. GUARANTEES AGAINST S TRIKES, LOCKOUTS, OR 14
SIMILAR DISRUPTIONS; 15

3. ENSURES THAT ALL WOR K PERFORMED ON THE 16
PROJECT CONFORMS TO ALL RELEVANT FEDERAL AND STATE LAWS, RULES, AND 17
REGULATIONS; 18

4. CREATES MUTUALLY BIN DING PROCEDURES FOR 19
RESOLVING LABOR DISPUTES ARISING DURING THE TERM OF THE PROJECT; 20

5. SETS FORTH MECHANISMS FOR LABOR–MANAGEMENT 21
COOPERATION ON MATTE RS OF MUTUAL INTERES T, INCLUDING PRODUCTIVI TY, 22
QUALITY OF WORK, SAFETY, AND HEALTH; AND 23

6. BINDS ALL CONTRACTORS AND SUBCONTRACTORS TO 24
THE TERMS OF THE AGR EEMENT THROUGH THE I NCLUSION OF APPROPRI ATE 25
PROVISIONS IN ALL RELEVANT SOLICITATION AND CONTRACT DOCUMENTS; 26

(IV) PROMOTE SAFE COMPLET ION OF THE PROJEC T BY 27
ENSURING THAT AT LEAST 80 PERCENT OF THE CRAFT WORKERS HAVE COMPLETED 28
AN OCCUPATIONAL SAFETY AND HEALTH ADMINISTRATION’S 10–HOUR SAFETY 29
COURSE; 30

(V) PROMOTE CAREER TRAIN ING OPPORTUNITIES IN THE 31
CONSTRUCTION INDUSTR Y FOR LOCAL RESIDENT S, VETERANS, WOMEN, 32
SENATE BILL 341 25

MINORITIES, AND FORMERLY INCARCERATED INDIVIDUALS; 1

(VI) INCLUDE PROVISIONS F OR LOCAL HIRING AND HIRING 2
HISTORICALLY DISADVANTAGED INDIVIDUALS; AND 3

(VII) ENSURE A STEADY SUPP LY OF LABOR AND PROM OTE 4
WORKFORCE DEVELOPMENT BY REQUIRING THE U SE OF APPRENTICES ENROLLED 5
IN REGISTERED APPRENTICESHIP PROGRAMS, AS DEFINED IN TITLE 11, SUBTITLE 6
4 OF THE LABOR AND EMPLOYMENT ARTICLE. 7

(K) ANY MISREPRESENTATION OR OMISSION INCLUDED IN THE REPORTING 8
REQUIRED BY A CONTRA CT AWARDED UNDER THI S SECTION SHALL CONSTITUTE A 9
FALSE RECORD OR STATEMENT MATERIAL TO A FALSE OR FRAUDULENT CLAIM FOR 10
PURPOSES OF § 8–102 OF THE GENERAL PROVISIONS ARTICLE. 11

7–1235. 12

(A) THE COMMISSION, BY REGULATION OR ORDER, SHALL: 13

(1) DIRECT ELECTRICITY S UPPLIERS, IN CONSULTATION WIT H THE 14
COMMISSION, TO JOINTLY SELECT AN ESCROW ADMINISTRATOR; 15

(2) ESTABLISH AN ESCROW ACCOUNT, UNDER THE SUPERVISIO N OF 16
THE ESCROW ADMINISTR ATOR, TO ENSURE THE SECURE AND TRANSPARENT 17
TRANSFER OF REVENUES AND SRECS, REGARDLESS OF TYPE , PROCURED UNDER 18
THIS SUBTITLE; 19

(3) ESTABLISH A NONBYPAS SABLE SURCHARGE THAT ALLOWS AN 20
ELECTRIC COMPANY TO RECOVER ALL COSTS ASSOCIATED WITH THE PURCHASE OF 21
SRECS AND SREC–IIS FROM CUSTOMERS IN THE SERVICE TERRITOR Y OF THE 22
ELECTRIC COMPANY THA T IS ADDED TO THE SU PPLY RATE O N A CUSTOMER ’S 23
UTILITY BILL; AND 24

(4) ESTABLISH A MECHANISM THAT ANNUALLY: 25

(I) DETERMINES EACH ELEC TRIC COMPANY ’S SREC AND 26
SREC–II PURCHASE OBLIGATIONS UNDER THIS SUBTITLE FOR THE FOLLOWING 27
COMPLIANCE YEAR FOR SRECS AND SREC–IIS GENERATED BY SOLAR ENERGY 28
GENERATING SYSTEMS THAT BEGIN OPERATION AFTER JANUARY 1, 2028; 29

(II) ADJUSTS THE RENEWABLE ENERGY PORTFOLIO STANDARD 30
OBLIGATION TO ACCOMMODATE A SHORTFALL OR EXCESS IN EARLIER YEARS THAT 31
RESULTS FROM THE VAR IATION BETWEEN THE Q UANTITY OF SRECS AND 32
26 SENATE BILL 341

SREC–IIS, CALCULATED FOR THE R ENEWABLE ENERGY PORT FOLIO STANDARD 1
OBLIGATION AND THE Q UANTITY OF SRECS AND SREC–IIS SOLD UNDER THIS 2
SUBTITLE; AND 3

(III) ADJUSTS THE NONBYPAS SABLE SURCHARGE FOR 4
PROJECTED AND PAST PURCHASE OBLIGATIONS. 5

(B) (1) EACH ELECTRIC COMPANY SHALL P ROCURE FROM THE ESCR OW 6
ACCOUNT UNDER THIS S ECTION THE NUMBER OF SRECS AND SREC–IIS TO 7
SATISFY THE ELECTRIC COMPANY’S OBLIGATIONS UNDER THIS SUBTITLE AND § 8
7–709.2 OF THIS TITLE. 9

(2) SUBJECT TO ANY ESCROW ACCOUNT RESERVE REQU IREMENT 10
ESTABLISHED BY THE COMMISSION, IF THERE ARE INSUFFI CIENT SRECS AND 11
SREC–IIS UNDER THIS SUBTITLE AVAILABLE FOR PURCHASE, ANY OVERPAYMENT 12
SHALL BE DISTRIBUTED BACK TO THE ELECTRIC COMPANY TO BE REFUND ED OR 13
CREDITED TO EACH CUS TOMER BASED ON THE C USTOMER’S CO NSUMPTION OF 14
ELECTRICITY THAT IS SUBJECT TO THE RENEW ABLE ENERGY PORTFOLI O 15
STANDARD. 16

(3) THE CALCULATION OF AN ELECTRIC COMPANY ’S SREC AND 17
SREC–II PURCHASE OBLIGATIONS UNDER THIS SUBTITLE FOR SRECS AND 18
SREC–IIS GENERATED BY SOLAR ENERGY GENERATING SY STEMS THAT BEGIN 19
OPERATION AFTER JANUARY 1, 2028, SHALL BE BASED ON FI NAL ELECTRICITY 20
SALES, AS DETERMINED BY THE COMMISSION. 21

(4) ANY INTEREST EARNED IN THE ESCROW ACCOUNT SHALL REMAIN 22
IN THE ACCOUNT AND MAY NOT BE REDIRECTED TO ANY OTHER FUND. 23

(C) SUBJECT TO ANY ESCROW ACCOUNT RESERVE REQU IREMENT 24
ESTABLISHED BY THE COMMISSION, COMPLIANCE FEES PAID INTO THE ESCROW 25
ACCOUNT ESTABLISHED IN THIS SECTION SHAL L BE DISTRIBUTED TO ELECTRIC 26
COMPANIES TO PAY FOR FUTURE SRECS AND SREC–IIS PROCURED UNDER THI S 27
SUBTITLE. 28

Article – Tax – General 29

8–404. 30

(a) Each public service company that, in a calendar year, has gross receipts 31
derived from business in the State or delivers electricity or natural gas for final 32
consumption in the State shall complete, under oath, and file with the Department a public 33
service company franchise tax return, on or before April 15th of the next year. 34

SENATE BILL 341 27

(b) (1) Each public service company that reasonably expects its public service 1
company franchise tax for a year to exceed $1,000 shall complete, under oath, and file with 2
the Department a declaration of estimated tax, on or before April 15 of that year. 3

(2) A public service company required under paragraph (1) of this 4
subsection to file a declaration of estimated tax for a taxable year shall complete and file 5
with the Department a quarterly estimated tax return on or before June 15, September 15, 6
and December 15 of that year. 7

(c) A public service company shall file with the return an attachment that states 8
any information that the Dep artment requires to determine gross receipts derived from 9
business in the State or kilowatt hours or therms of natural gas delivered for final 10
consumption in the State. 11

(D) A PUBLIC SERVICE COMPANY THAT IS ENGAGED IN THE TRANSMISSION, 12
DISTRIBUTION, OR DELIVERY OF ELECTRICITY IN THE STATE SHALL FILE WITH THE 13
RETURN THE GROSS RECEIPTS DERIVED FROM CUSTOMERS IN THE STATE THAT USE 14
MORE THAN 100 MEGAWATTS OF ELECTRICITY. 15

8–408. 16

The Department shall: 17

(1) administer the laws that relate to the public service company franchise 18
tax; 19

(2) adopt reasonable regulations to administer the provisions of laws that 20
relate to the public service company franchise tax; 21

(3) design the returns and forms that, on completion, provide the 22
information required for the administration of the public service company franchise tax 23
laws; 24

(4) collect the public service company franchise tax revenue, including 25
penalties and interest; 26

(5) ALLOCATE 75% OF THE PUBLIC SERVIC E COMPANY FRANCHISE 27
TAX REVENUES ATTRIBU TED TO CUSTO MERS THAT USE MORE T HAN 100 28
MEGAWATTS OF ELECTRI CITY THAT IS COLLECT ED FROM PUBLIC SERVI CE 29
COMPANIES THAT ARE E NGAGED IN THE TRANSM ISSION, DISTRIBUTION, OR 30
DELIVERY OF ELECTRICITY IN THE STATE TO THE ESCROW ACCOUNT ESTABLISHED 31
UNDER § 7–1235 OF THE PUBLIC UTILITIES ARTICLE; 32

(6) EXCEPT AS PROVIDED I N ITEM (5) OF THIS SECTION , pay that 33
revenue into the General Fund of the State; and 34

28 SENATE BILL 341

[(6)] (7) certify to the Comptroller that revenue. 1

SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 2
October 1, 2026. 3