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 and related equipment 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 get certified within one year and have already paid taxes on the equipment, your locality may reimburse you for those taxes paid.

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 there are no fixed dollar amounts guaranteed by the state. You can manage and sell your RECs yourself through the PJM-EIS Generation Attribute Tracking System (GATS), work with a REC broker or aggregator, or bundle them with your energy sales through a power purchase agreement. To participate, your solar system must be registered in GATS and meet Virginia’s renewable energy definitions. Currently, systems of all sizes are eligible, including residential installations, and there are no specific deadlines mentioned for participation. Keep in mind that REC values fluctuate with market conditions, so it’s important to research current pricing and consider working with experienced brokers who can help maximize your returns.

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, the extra power flows to the grid and you receive credits on your electric bill at the same rate you pay for electricity (1:1 credit ratio). During times when your solar panels aren’t producing enough power, like at night or on cloudy days, you can use these credits to offset the cost of electricity you draw from the grid.

The financial benefit varies by utility company. If you’re served by Dominion Energy Virginia, excess credits carry over month to month and can either roll over to the next year or be paid out at their avoided cost rate of approximately 3-5 cents per kWh. Appalachian Power Company (APCo) customers can carry credits over indefinitely from month to month, though they don’t offer cash payments for unused credits. This program is available to residential customers who install qualifying solar energy systems, though specific eligibility requirements and system size limits may apply depending on your utility provider.

There are no specific deadlines mentioned for this program, but net metering policies can change over time. Homeowners should verify current program details with their utility company before installing solar panels, as terms and availability may vary by location and utility service area within Virginia.