Quick answer: Geothermal credits — formally, geothermal renewable energy credits, or GRECs — pay homeowners for the clean energy their geothermal systems produce. Maryland and Pennsylvania have active markets today. Illinois and Virginia have passed laws to launch programs of their own. In Maryland, the most mature market, a typical residential system earns roughly $3,567 per year in gross credit value as of mid-2026 — and can remain eligible for as long as the system stays certified.
The timing matters. The federal geothermal tax credit ended on December 31, 2025. That was a one-time discount at installation. Geothermal credits are different: they can pay you every year your system runs, for as long as your system stays certified under Maryland's program (COMAR 20.61.02.04). And many people who already own geothermal systems have no idea they may qualify.
All figures are snapshots as of mid-2026. Credit prices are set by a market and move up and down. Sources are cited at the bottom of this page.
How geothermal energy credits work
Every 1,000 kilowatt-hours of clean thermal energy your system produces has a dollar value in states with credit programs — because utilities there need those credits to meet state clean-energy rules. Here's the chain, step by step:
- Your system produces clean thermal energy. A geothermal heat pump doesn't generate electricity. It moves heat — warming your home in winter and cooling it in summer. That clean energy is what’s being credited.
- The energy is measured in credits. One credit equals one megawatt-hour (MWh) — that’s 1,000 kilowatt-hours of clean energy produced or displaced.
- Credits are recorded in a registry. Today's programs mostly run through PJM GATS (the PJM Generation Attribute Tracking System), the online registry that tracks renewable energy credits for states including Maryland and Pennsylvania.
- Utilities buy the credits. State laws called renewable portfolio standards (RPS) require utilities to support a set amount of clean energy. Buying credits from system owners is one way they comply.
- You get paid. Most homeowners sell through a broker or aggregator — a company that registers systems, pools credits from many owners, and handles the sale.
States with geothermal credit programs
How much do geothermal credits pay? It depends entirely on where you live — geothermal energy credits only exist where state law creates a market for them. Here's each state in plain numbers.
Mid-2026 market snapshot
Where geothermal credit programs stand
Active states pay now. Enacted states have passed laws but haven't started payments yet.
Maryland
~$3,567/yr gross at ~$87/credit. Eligible as long as system stays certified. ACP stepping down: $90 (2026) → $80 (2027) → $65 (2028+). Tracked via PJM GATS.
Pennsylvania
~$26/credit (Tier II AECs). Savings-based measurement. $45 ACP price ceiling.
Illinois
Est. $35–50/credit. 15-yr contracts. At least 40% upfront. CRGA, P.A. 104-0458.
Virginia
~$45/credit (Flett Exchange listing, mid-2026). $100/MWh base deficiency payment (1%/yr increase) under Chapter 734 (April 2026). PJM GATS. Procurement targets: 0.5% (2027), 0.75% (2028), 1.0% (2029+).
Massachusetts
Alternative Energy Certificates (AECs) under the Alternative Portfolio Standard.
New Hampshire
Class I Thermal Renewable Energy Certificates (TRECs). Smaller market.
All values are snapshots. Credit prices are set by a market and move up and down. Every dollar figure on this page is approximate as of mid-2026, not a promise.
Maryland: roughly $3,567 a year (mid-2026)
Maryland runs the most mature geothermal credit market. As of mid-2026, credits sell for ~$87 each, and a typical residential system generates about 41 credits per year. That works out to roughly $3,567 per year in gross credit value — and systems can remain eligible for as long as they stay certified — COMAR 20.61.02.04 sets no fixed expiration on geothermal system certification, though most broker contracts run approximately 20 years. The premium rate applies to “post-2022 geothermal systems” — those placed in service on or after January 1, 2023 (PUA § 7-701(i)). Legacy systems earn only ordinary Tier I RECs at a lower rate. How much are geothermal credits worth after fees? Actual geothermal credits income depends on your broker's commission and contract terms, but even after fees, this can be meaningful annual income from a system you're already running.
One thing to watch: Maryland's alternative compliance payment (ACP) — the price a utility pays when it falls short of its clean-energy targets — is stepping down over the next few years: $90 in 2026, $80 in 2027, and $65 from 2028 onward. That ACP generally caps what credits can sell for, so credit values may ease downward as it drops. Source: Maryland PSC renewable energy schedule.
The process is straightforward: your system is registered with PJM GATS, savings-based calculations determine your credit volume (no dedicated meter is required), credits are generated, a broker sells them, and you get paid. Several brokers serve Maryland homeowners (more on choosing one below).
Read the full Maryland geothermal credits guide → — broker comparison, step-by-step registration, and FAQ.
Considering a system? Annual credit income on this scale changes the payback math. Start with a preliminary loop estimate using our geothermal loop calculator, then compare quotes from geothermal installers in Maryland.
Pennsylvania: about $26 per credit (2026)
Pennsylvania pays too — just less, and under a different name. Search for "GRECs" in Pennsylvania and you'll come up empty: the state calls them Tier II Alternative Energy Credits (AECs). As of 2026, they trade around $26 per credit.
Two Pennsylvania quirks worth knowing:
- Credits are savings-based. Instead of metering raw output, Pennsylvania credits the energy your heat pump displaces compared with a conventional heating and cooling system.
- There's a built-in price ceiling. The state's alternative compliance payment (ACP) — the amount a utility pays when it falls short of its clean-energy targets — is $45 per MWh as of 2026. That generally creates an effective market-price ceiling near $45 per credit.
Read the full Pennsylvania geothermal credits guide → — Tier II AECs, savings-based measurement, and how to register.
Pennsylvania uses the same PJM GATS registry as Maryland. If you're weighing a system, start by comparing geothermal installers in Pennsylvania.
Illinois: estimated $35–50 per credit, starting 2028
Illinois has committed real money — up to $10 million per year through 2035, funded by utility-collected RPS charges — but payments haven't started yet. The Clean and Reliable Grid Affordability Act (CRGA), enacted as P.A. 104-0458 and signed January 8, 2026, creates a geothermal credit program for new systems (operational on or after June 1, 2026) with first credit delivery in 2028, administered by the Illinois Power Agency.
What the program looks like:
- Estimated credit value: $35–50 per GREC. This is an estimate as of 2026 — the market hasn't opened, so no real price exists yet.
- A typical residential system: about 50 GRECs per year. If prices land in the estimated range, that's very roughly $1,750–$2,500 a year — again, an estimate, not an established figure.
- 15-year contracts, giving owners a long payment horizon.
- At least 40% paid upfront when your system is switched on — a feature unique to Illinois. Final eligibility and payment procedures are subject to program rules the Illinois Power Agency has not yet published.
- At least 33% of each annual credit block reserved for residential systems.
Read the full Illinois geothermal credits guide → — CRGA eligibility, 15-year contracts, and upfront payment details.
If you're in Illinois, the practical move is to follow the Illinois Power Agency's program rules as they're published, and confirm your system will qualify before counting on credit income. Start by comparing geothermal installers in Illinois.
Virginia: program forming, compliance starts around 2027
As of mid-2026, Flett Exchange lists Virginia GRECs at approximately $45 per credit. Chapter 734 (SB252, signed April 13, 2026), building on SB508 (2024, Chapter 597) which first made geothermal RPS-eligible, significantly strengthened the state’s commitment. (A companion bill, HB1102, became Chapter 733 with identical substance.) It sets procurement targets for Dominion Energy and Appalachian Power (APCo): 0.5% of RECs used for RPS compliance in 2027, 0.75% in 2028, and 1.0% from 2029 onward — all to be filled with geothermal credits through quarterly RFPs. Credits are tracked through PJM GATS. The base deficiency payment is $100 per MWh (increasing 1% annually, with an availability exemption), which generally caps what credits can sell for. The SCC must report on the program by November 1, 2028. Source: Virginia Acts of Assembly 2026, Chapter 734; Virginia DLS bill summary; Flett Exchange.
Read the full Virginia geothermal credits guide → — Chapter 734 details, pricing outlook, and how to prepare.
Virginia homeowners thinking about geothermal can get ahead of the launch: geothermal installers in Virginia.
Other states: Massachusetts and New Hampshire
Two more states pay geothermal owners under programs that don't use the GREC name.
Massachusetts runs an Alternative Portfolio Standard (APS), and geothermal heat pumps qualify for its Alternative Energy Certificates (AECs) — same idea, different label.
New Hampshire offers Class I Thermal Renewable Energy Certificates (TRECs), which geothermal heat pumps can earn. It's a smaller market than the others on this page.
GRECs vs. the federal geothermal tax credit (25D)
The single most common mix-up: geothermal credits are not the federal tax credit — and the tax credit's end doesn't affect them. The federal Residential Clean Energy Credit — known as 25D, after its section of the tax code — covered 30% of geothermal installation costs as a one-time tax credit. It ended on December 31, 2025, under the One Big Beautiful Bill Act (OBBBA).
Geothermal credits work on completely different logic:
| Federal 25D tax credit | Geothermal energy credits | |
|---|---|---|
| What it is | One-time tax credit | Ongoing annual income |
| Based on | Installation cost (30%) | Energy your system produces or displaces |
| How long | Once, at installation | As long as system stays certified (broker contracts typically ~20 years) |
| Status | Ended December 31, 2025 | Active in MD (GRECs) and PA (Tier II AECs); coming in IL and VA |
Credits are also just one piece of the incentive picture. For rebates and other state-level support, see our guide to geothermal incentives by state.
How to start earning geothermal credits
For most eligible homeowners, getting started is mostly paperwork — and a broker can do the heavy lifting. The high-level path:
- Confirm your state pays. Maryland and Pennsylvania are active. Illinois and Virginia are coming; Massachusetts and New Hampshire run related programs. (Details in the state sections above.)
- Gather your system records. Registration requires proof of installation, your system's specifications, and utility interconnection details (the paperwork connecting your system with your utility).
- Register your system. Maryland and Pennsylvania use PJM GATS; other states may use different registries or administrators. You can register directly, or have a broker or aggregator do it — brokers often include registration in their service. Expect the process to take several weeks to a few months.
- Decide how to sell geothermal credits. Brokers and aggregators active in Maryland include Carbon Solutions Group, ClearPath Renewables, and Flett Exchange. Availability varies by state. We don't endorse any of them — compare fees, payment terms, and contract length before signing anything.
- Get paid as your credits sell. Keep records of what you receive — credit income generally matters at tax time (see the FAQ below).
Frequently asked questions about geothermal credits
What is a geothermal renewable energy credit (GREC)?
A GREC is a tradable credit representing the clean energy a geothermal heat pump produces or displaces. One credit equals one megawatt-hour (1,000 kilowatt-hours) of clean energy produced or displaced. Credits are recorded in a registry — primarily PJM GATS for Maryland and Pennsylvania — and sold to utilities that need them to meet state clean-energy requirements. The homeowner receives the resulting payment, less any broker fees or contract deductions.
How much money can I earn from geothermal credits?
It depends on your state. In Maryland, a typical residential system earns about 41 credits a year at ~$87 each — roughly $3,567 per year in gross credit value as of mid-2026, for as long as the system stays certified. Actual proceeds depend on broker fees. Pennsylvania credits trade around $26 as of 2026. In Illinois, estimated values are $35–50 per credit (as of 2026) when deliveries begin in 2028. Prices move with the market, so treat every figure as approximate.
Which states have geothermal credit programs?
Maryland and Pennsylvania have active markets today. Illinois has enacted a program with first credit delivery in 2028, and Virginia's program begins utility compliance around 2027. Massachusetts (Alternative Energy Certificates) and New Hampshire (Thermal Renewable Energy Certificates) pay geothermal owners under similar programs with different names.
Are geothermal credits the same as the federal tax credit?
No. The federal 25D credit was a one-time tax credit worth 30% of installation costs, and it ended December 31, 2025. Geothermal credits are ongoing annual income based on what your system produces — for as long as the system stays certified in Maryland. They are separate programs: homeowners who claimed 25D can still earn geothermal credits.
Are geothermal credit payments taxable?
Generally, yes. Credit income is typically treated as ordinary taxable income, and brokers may issue a 1099 form for payments of $2,000 or more in a year (threshold raised by OBBBA for payments after December 31, 2025, with inflation adjustments from 2027). That's different from the old 25D credit, which reduced your tax bill rather than adding income. IRS treatment specific to geothermal credit income isn't well documented, so keep good records and consult your tax advisor for guidance specific to your situation.
Ready to run the numbers?
If you already own a geothermal system in a credit state, your earning path starts with registration — see "How to start earning" above. If you're still deciding on geothermal, use our planning tools below.
Plan your geothermal project
Estimate your loop size, projected costs, and available incentives — including potential credit income.
Sources and methodology
This guide uses official state legislation, regulatory filings, and program documents. All credit values, program parameters, and dates were verified against primary sources as of September 2026. Published amounts are reported as market figures or program estimates — not guarantees. Program details are monitored for changes; homeowners should confirm current terms with the relevant state agency or broker before acting.