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. Some localities may provide the exemption retroactively to your installation date and reimburse any taxes already paid on the solar equipment.

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. When your solar system generates electricity, it creates RECs that can be sold in the PJM regional market through brokers or aggregators, providing an ongoing revenue stream beyond your electricity savings.

The financial benefit varies based on market demand and is not a fixed amount – REC prices fluctuate based on supply and demand in the regional market. To be eligible, your solar system must be registered through the PJM Generation Attribute Tracking System (GATS) and meet Virginia’s renewable energy standards. Systems must be located either in Virginia or within the broader PJM region, and different rules apply for the periods 2021-2024 versus 2025 and beyond.

Homeowners should know that managing RECs requires working with registered brokers or aggregators, as there’s no separate Virginia-specific SREC market. The program is part of Virginia’s mandatory Renewable Energy Portfolio Standard, which creates ongoing demand for these certificates. You’ll need to obtain a State Certification Number through the GATS registration process to participate, and smaller residential systems receive special identifiers in the tracking system.

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). This means every kilowatt-hour (kWh) of solar energy you send to the grid reduces your future electric bills by the same amount you would normally pay for that electricity.

The financial benefits vary depending on your utility company. If you’re served by Dominion Energy Virginia, any unused credits can roll over month to month throughout the year. At the end of each year, remaining credits are either carried forward or paid out at Dominion’s avoided cost rate (approximately 3-5 cents per kWh). For Appalachian Power Company (APCo) customers, excess credits roll over indefinitely from month to month, but the utility does not provide cash payments for unused credits. This program is available to residential customers who install qualifying solar energy systems, though specific system size limits and interconnection requirements may apply through your local utility company.