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The federal residential solar tax credit (Section 25D) died on December 31, 2025. Maine does not have production incentives like Rhode Island or Massachusetts. But it still has 5 active incentive programs and the strongest oil-displacement story in the country. This is the honest, complete guide to what still works.
The federal residential solar tax credit (Section 25D) expired December 31, 2025. Maine homeowners who buy solar with cash or a loan receive $0 in federal tax credits. However, Maine still has 5 active programs that support solar investment:
Bottom line: A 9 kW system at $3.05/W costs $27,450 — the full price with no federal credit. NEB credits return $2,916-$3,456/year depending on utility. Payback is 15-17 years (CMP) or 12-14 years (Versant). The real Maine advantage? Pair solar with heat pumps to eliminate $3,400+/year in heating oil.
Before we cover what still works, let's be honest about what's gone. Other solar websites still reference these programs. They are wrong.
Homeowners who purchase solar with cash or a loan receive $0 in federal tax credits. This was 30% in 2025 under the Inflation Reduction Act. The OBBBA signed July 4, 2025 ended it.
The $2,000 heat pump tax credit and $1,200 insulation/efficiency credit are both dead. Efficiency Maine state rebates are separate and still active — but the federal 25C credit is gone.
The federal credit was the big loss. But every Maine state-level program survived intact. Here is the full comparison.
| Incentive Program | 2025 | 2026 | Status |
|---|---|---|---|
| Federal Tax Credit (25D) | 30% of system cost (~$8,235) | $0 — Expired Dec 31, 2025 | Expired |
| Net Energy Billing (NEB) | 1:1 retail credit for rooftop solar | 1:1 retail credit for rooftop solar | Active |
| Property Tax Exemption | 100% exempt statewide | 100% exempt statewide | Active |
| Section 48E (Lease/PPA) | 30%+ for third-party owner | 30%+ through July 4, 2026 | Deadline |
| Propel Financing (ME) | $0 down, FEOC Silfab panels | $0 down, FEOC Silfab panels | Active |
| Efficiency Maine HP Rebates | $1,000-$3,000/unit | $1,000-$3,000/unit | Active |
| 25C Energy Efficiency | $2,000 heat pump credit | $0 — Expired Dec 31, 2025 | Expired |
The federal 25D credit was worth about $8,235 on a typical 9 kW Maine system. That is a real loss. Unlike states with strong production incentives (RI, MA), Maine does not have a direct replacement. The path forward is oil displacement through solar + heat pumps — a strategy that can save $5,000+/year when you combine NEB credits with eliminated heating oil costs.
Net Energy Billing (NEB) is Maine's most valuable solar incentive. Your rooftop solar system receives 1:1 retail-rate bill credits for all electricity exported to the grid. Unlike many states that have reduced net metering to 80% or less, Maine gives you the full retail value back.
LD 1777 (2023) changed compensation for community solar only. Rooftop residential NEB is NOT affected. Your rooftop system still gets 1:1 retail credit. Do not let anyone tell you otherwise.
Read our complete Maine NEB guide with utility-specific details
Based on 9 kW x 1,200 kWh/kW = 10,800 kWh/year production. 35% self-consumed at retail + 65% exported at 1:1 NEB credit.
Solar energy equipment is 100% exempt from property tax assessment statewide in Maine (36 M.R.S. §655). Unlike New Hampshire where it is a local option (~66% of towns), Maine mandates this for every municipality. Your home is worth more with solar, but your property tax bill stays the same.
Automatic — no paperwork required. All municipalities must honor it.
Maine's 5.5% sales tax exemption for solar equipment is currently unverified. The standard 5.5% may apply to solar equipment purchases. The property tax exemption (36 M.R.S. §655) is verified and mandated statewide.
Recommendation: Confirm sales tax exemption status with your installer before purchasing. We will not claim savings that are not verified.
While homeowners cannot claim any federal tax credit for solar, the Section 48E commercial ITC is still available for third-party system owners. If you go with a solar lease or PPA, the financing company claims the 30%+ credit and passes savings to you through lower monthly payments. This is more important in Maine than in most states because there is no state rebate to offset the loss of 25D.
After July 4, 2026, the Section 48E commercial ITC drops or ends entirely. Lease/PPA rates will likely increase after this deadline. If you are considering a lease or PPA, starting the process now ensures you benefit from the current 30%+ credit.
Before 2026, cash buyers got 30% back through 25D. Now they get $0. But third-party owners still claim the commercial ITC. This makes lease/PPA relatively more competitive vs. cash purchase in Maine. The financing company captures value the homeowner cannot access. See our full financing comparison
Propel is a solar financing program available in Maine that uses FEOC-compliant Silfab 440W panels and a third-party ownership structure. The financing company claims Section 48E, passing the benefit through to you as lower payments. This is especially attractive post-ITC because you cannot claim 25D anyway.
No upfront payment required. System is installed with zero out-of-pocket cost.
Silfab 440W panels meet Foreign Entity of Concern requirements for full ITC eligibility.
Financing company claims 30%+ Section 48E credit. Savings flow to you through lower payments.
While not a solar incentive directly, Efficiency Maine heat pump rebates are the secret weapon that makes Maine solar economics work. Maine is the #1 heating oil state in the US (60%+ of homes). Solar panels power your heat pumps. Heat pumps replace $3.82/gal oil. The combined savings are transformative.
Average Maine home uses ~800 gallons of heating oil at $3.82/gal = $3,056/year in heating costs. Heat pumps reduce this by 50-70%. Solar powers the heat pumps. Combined, you eliminate $2,100-$3,400/year in heating costs on top of your NEB electric savings. This is Maine's strongest post-ITC story.
See how solar + heat pump bundles work in Maine | Full Efficiency Maine rebate guide
Maine's two utilities have different rates. Higher Versant rates mean faster solar payback — the opposite of what most people assume.
Versant customers pay more for electricity, which means solar saves more per kWh. A 9 kW system in Versant territory saves $540 more per year than the same system in CMP territory. Over 25 years, that is $13,500 more value — making Versant territory one of the better solar economics stories in Maine. Full CMP vs. Versant analysis
Here is exactly how the math works for a typical Maine solar installation in 2026. No federal credit. Just state programs and honest numbers.
We believe in transparency. Here is how Maine compares to other New England states for solar investment in 2026.
Without the federal ITC, strategy matters more than ever. Here is the optimal approach for Maine homeowners.
Know your system size, cost, and utility territory before making any decisions. NuWatt provides free Maine-specific solar designs.
Get your free solar designCash buyers pay full price ($0 ITC). Lease/PPA captures Section 48E through July 4, 2026. The math is different now — run both scenarios.
ME financing comparisonIf you heat with oil, this is the move. Efficiency Maine rebates ($1K-$3K/unit) + solar NEB savings + eliminated oil costs = fastest total payback in Maine.
Solar + HP bundle guideVersant customers see 12-14 year payback vs. 15-17 for CMP. Your utility determines your NEB credit value and total ROI.
CMP vs. Versant analysisSection 48E expires for new projects after July 4, 2026. If you are going with Propel or another lease/PPA, construction must begin before that date.
Lease/PPA deadline guideMaine has 5 active solar-related incentive programs in 2026: Net Energy Billing (1:1 retail credit for rooftop solar), 100% statewide property tax exemption, Section 48E commercial ITC for lease/PPA systems (30% through July 4, 2026), Propel $0-down financing with FEOC-compliant panels, and Efficiency Maine heat pump rebates ($1,000-$3,000/unit) for solar+HP bundles. The federal residential 25D credit is $0.
No. The federal residential solar tax credit (Section 25D) expired December 31, 2025. Homeowners who buy solar with cash or a loan receive $0 in federal tax credits. However, lease/PPA companies that own the system can still claim Section 48E (30%+) on projects beginning construction before July 4, 2026, passing savings to you via lower monthly payments.
Net Energy Billing (NEB) gives Maine rooftop solar owners 1:1 retail-rate bill credits for all electricity exported to the grid. This means every kWh you send back offsets your bill at the full retail rate — $0.27/kWh for CMP customers or $0.32/kWh for Versant customers. Credits roll over monthly and are trued up annually at avoided cost. LD 1777 (2023) only changed community solar — rooftop NEB is NOT affected.
Without the federal ITC, Maine solar payback is 15-17 years for CMP customers ($0.27/kWh) and 12-14 years for Versant customers ($0.32/kWh). This is longer than states like Rhode Island or Massachusetts that have production incentives. However, the property tax exemption and 1:1 NEB credits still make solar a strong long-term investment, especially when paired with a heat pump to displace $3.82/gal heating oil.
Yes, but with honest expectations. Maine does not have production incentives like Rhode Island REG or Massachusetts SMART. The value proposition is driven by 1:1 net metering, property tax exemption, and especially oil displacement. A 9 kW solar system plus heat pumps can eliminate $3,400+ per year in heating oil costs. Over 25 years, a 9 kW system generates $50,000-$80,000+ in total value depending on your utility.
Yes. Solar energy equipment is 100% exempt from property tax assessment statewide in Maine. Unlike New Hampshire (where it is a local option), Maine mandates the exemption for all municipalities. A 9 kW system adds value to your home but $0 to your property tax bill. At Maine average 1.39% effective rate, this saves approximately $381/year permanently.
Central Maine Power (CMP) serves ~70% of Maine at $0.27/kWh. Versant Power serves ~30% (northern/eastern Maine) at $0.32/kWh. Both offer 1:1 NEB for rooftop solar. Versant customers actually see faster solar payback (12-14 years vs. 15-17) because higher rates mean more valuable bill credits. Versant territory is one of the best solar economics stories in Maine.
Section 48E is the commercial/third-party ITC. When you sign a solar lease or PPA, the financing company owns the system and claims the 30%+ credit. They pass savings to you through lower monthly payments — typically 10-20% below your current electric rate. This is available for projects beginning construction before July 4, 2026. You do not file anything on your tax return.
Absolutely, and this is Maine strongest value proposition. Efficiency Maine offers $1,000/unit (standard), $2,000/unit (moderate-income), or $3,000/unit (low-income) heat pump rebates, up to 3 units. A solar system powers your heat pumps, eliminating $3.82/gal heating oil costs. The combined savings from oil displacement plus solar NEB credits can exceed $5,000/year.
Propel is a $0-down solar financing program available in Maine. It uses FEOC-compliant Silfab 440W panels and third-party ownership structure where the financing company claims the Section 48E ITC. The benefit passes through to you as lower payments. Propel is especially attractive post-ITC because the homeowner cannot claim 25D anyway — the third-party structure captures value that would otherwise be lost.
No. LD 1777 (2023) only changed compensation for community solar projects filed after January 1, 2024. Rooftop residential solar is NOT affected — it still receives 1:1 retail-rate NEB credits. Existing community solar subscribers keep their current rate. Only new community solar projects receive the lower tariff-based compensation.
Maine solar costs $2.91-$3.19 per watt installed in 2026, with a statewide average of $3.05/W. A typical 9 kW system costs $26,190-$28,710 before incentives. With no federal 25D credit, this is the full out-of-pocket cost for cash buyers. Portland, Lewiston, and Bangor all fall within this range. Versant territory tends to be slightly lower cost.
Section 48E expires July 4, 2026 for lease/PPA projects. Propel financing is available now. Oil prices are not getting cheaper. Get your free solar design and see what makes sense for your home.