Solar Guide

Virginia’s Solar Property Tax Exemption allows local governments (counties, cities, and towns) to exempt solar energy equipment from property taxes. This means homeowners can potentially avoid paying property taxes on the added value that solar panels bring to their home. The exemption applies to certified solar energy equipment, facilities, or devices that are designed and used primarily for collecting, generating, transferring, or storing thermal or electric energy.

The financial benefit varies by location since each local government decides whether to offer the exemption and how much to exempt (partial or full). When available, the exemption reduces your property tax bill by the amount you would have paid on the assessed value of your solar equipment. The exemption lasts for at least five years once approved. To qualify, you must apply to your local building department for certification within one year of installation, and your solar equipment must meet state requirements. If you obtain certification within one year and have already paid taxes on the equipment, your locality may reimburse those taxes. This incentive requires your local government to have adopted an ordinance offering the exemption, so availability depends on where you live in Virginia.

Virginia’s Solar Renewable Energy Certificates (SRECs) program allows homeowners with solar panels to earn additional income by selling certificates that represent the environmental benefits of their clean energy production. Each time your solar system generates 1,000 kilowatt-hours (1 megawatt-hour) of electricity, you earn one REC that can be sold in the PJM regional market. These certificates help utilities meet Virginia’s renewable energy requirements while providing you with an ongoing revenue stream from your solar investment.

The financial value of RECs varies based on market demand, and homeowners can either manage their RECs directly through the PJM-EIS tracking system or work with registered brokers and aggregators who handle the sales process. Your solar system must be registered in Virginia’s Generation Attribute Tracking System (GATS) to participate, and the program operates under Virginia’s mandatory Renewable Energy Portfolio Standard. Currently, solar systems must be located either in Virginia or within the broader PJM region to qualify, with specific eligibility rules that differ for the periods 2021-2024 and 2025 onward. There are no application deadlines, but you’ll need to register your system and obtain a State Certification Number through the GATS process to start earning and selling your RECs.

Net metering in Virginia allows homeowners with solar panels to receive credit for excess electricity they generate and send back to the power grid. When your solar system produces more energy than your home uses during sunny periods, that extra power flows to the grid and you receive a 1:1 credit on your electric bill – meaning you get full retail rate credit for every kilowatt-hour (kWh) you contribute.

The financial benefit varies by utility company. With Dominion Energy Virginia, you can carry excess credits from month to month throughout the year. At the end of each year, any remaining credits either roll over to the next year or are paid out at Dominion’s avoided cost rate (typically 3-5 cents per kWh). Appalachian Power Company (APCo) customers can roll over excess credits indefinitely without any annual payout, though credits are not paid out as cash. This system essentially allows your electric meter to ‘spin backwards’ when you’re producing more energy than you’re using, reducing your overall electricity costs.

Net metering is available to residential solar customers served by participating Virginia utilities, though specific system size limits and interconnection requirements may apply. There are no specific deadlines mentioned for this ongoing program, but it’s important to note that net metering policies can change over time as utilities reach certain solar capacity thresholds or through regulatory updates.