Virginia Solar Panels

The federal Residential Clean Energy Tax Credit (Section 25D) provides a 30% tax credit on the cost of a new battery storage system that is 3 kWh or larger in capacity. Unlike the residential solar ITC — which was eliminated effective January 1, 2026 — the battery storage credit remains available for qualifying installations.

To qualify, the battery storage system must be installed alongside solar panels as part of the same project. Retrofitting a battery to an existing solar system at a later date will not qualify for this credit. For a typical home battery system costing $10,000–$15,000, this credit can save homeowners $3,000–$4,500 on their federal tax bill.

This is a non-refundable tax credit, meaning it reduces your federal income tax liability dollar-for-dollar. If the credit exceeds your tax liability in a given year, the unused portion can be carried forward to future tax years. Consult a tax professional to confirm your eligibility and maximize your benefit.

Created under the Virginia Clean Economy Act (VCEA) of 2020, Virginia’s SREC program allows residential solar owners to earn one Solar Renewable Energy Certificate for every 1,000 kWh (1 MWh) of electricity their solar panels produce. Utilities are required to purchase these certificates to meet their Renewable Portfolio Standard (RPS) obligations, creating a real market for your solar generation.

Current SREC prices in Virginia range from approximately $22.50 to $35 per certificate, with a state-mandated price cap of $75 per SREC. Each SREC is valid for 5 years from the year it is generated, giving you flexibility in when to sell. You do not need to be a Dominion Energy or Appalachian Power customer to participate — any Virginia solar owner is eligible.

To start earning SRECs, you must complete the utility interconnection process and then register your system with an SREC aggregator or broker (such as SRECTrade) within the same calendar year as your interconnection date. Once registered, your system will typically begin generating SRECs within two months, and your broker will sell them on the market on your behalf automatically.

Virginia’s net metering program, governed by Virginia Code §56-594, allows residential solar customers to earn credits on their electricity bills for excess power their solar panels send to the grid. Both Dominion Energy and Appalachian Power Company (APCo) currently offer net metering at the full retail rate — a one-to-one credit — for residential systems up to 20 kW. Credits roll over month to month, and any remaining credits at the end of a 12-month billing cycle can be carried forward or paid out at the avoided-cost rate.

Important 2026 Update: Both Dominion Energy and APCo have proposed changes to net metering compensation for new customers. Dominion’s NEM 2.0 proposal would shift to real-time (half-hourly) netting and base credit rates on distributed solar PPA rates rather than the full retail rate. APCo has already received SCC approval to compensate net excess generation fed back to the grid at the avoided-cost rate. An SCC evidentiary hearing was scheduled for January 20, 2026, and a final order is expected mid-2026.

Grandfathering Protection: Customers who install solar and connect to the grid before the SCC issues its final order on net metering changes will be grandfathered under the existing full retail-rate rules. The aggregate capacity limit for net metering is 6% of each utility’s prior-year peak-load forecast (1% reserved for low-income customers, 5% for all others), and enrollment is first-come, first-served.

Signed into law in 2022 and effective January 1, 2023, Virginia’s Residential Property Tax Exemption for Solar (S.B. 686) declares solar installations of less than 25 kW to be a separate class of property that is 100% exempt from state and local real and personal property taxes. This means adding solar panels to your home will not increase your property tax bill — a significant long-term savings benefit given that solar can add tens of thousands of dollars to a home’s assessed value.

For larger certified solar energy systems, Virginia also offers a tiered property tax exemption: 80% of the system’s value is exempt from property assessment for the first five years of ownership; 70% is exempt for years six through ten; and 60% is exempt for the remainder of the system’s lifespan. This tiered structure ensures ongoing tax savings throughout the life of your solar investment.

This exemption applies statewide to all residential and agricultural solar installations and does not require a separate local ordinance to take effect for systems under 25 kW. Homeowners should notify their local tax assessor of their solar installation to ensure the exemption is properly applied to their property tax assessment.

Fairfax County provides a local property tax exemption for solar energy equipment installed on residential and commercial properties. Qualifying solar installations — including solar panels and solar hot water systems — are eligible for an exemption valued at 100% of the cost and installation of the solar equipment, deducted from the property’s assessed value.

The exemption is applied for a period of five years from the date of installation. This means that for five years, the added value that your solar system contributes to your home’s assessed value will not be subject to Fairfax County property taxes, resulting in meaningful annual savings on top of the statewide exemption.

Property owners must apply to the Fairfax County Department of Tax Administration to receive this exemption. Be sure to apply promptly after installation to ensure you receive the full five-year benefit. This local exemption stacks with Virginia’s statewide solar property tax exemption, providing comprehensive property tax protection for Fairfax County solar owners.

Loudoun County offers a local property tax exemption for certified solar energy equipment installed on residential and commercial properties. Under this program, the cost of qualifying certified solar equipment is used to reduce the taxable assessed value of the real estate on which it is installed, directly lowering the property owner’s annual tax bill.

The exemption may be applied to all or a portion of the cost of the certified solar equipment, depending on the type and size of the installation. This local incentive works in conjunction with Virginia’s statewide solar property tax exemption to ensure that Loudoun County solar owners are not penalized with higher property taxes for investing in clean energy.

Property owners should contact the Loudoun County Commissioner of the Revenue to apply for this exemption and confirm the specific documentation required. Applying promptly after installation ensures you receive the maximum benefit from this program.

Prince William County’s Solar Exemption program provides a property tax exemption for certified solar energy equipment, facilities, or devices installed on qualifying properties. The exemption is available for all property types — residential, commercial, and industrial — making it one of the more broadly applicable local solar incentives in Northern Virginia.

The tax exemption takes effect on January 1 of the year following application approval. The exemption reduces the assessed value of the property by the value of the qualifying solar installation, ensuring that your investment in solar does not result in a higher property tax bill.

To take advantage of this program, property owners must submit an application to the Prince William County Tax Administration office. It is important to apply as soon as possible after installation so that the exemption can be processed and applied to the next tax year’s assessment.

The City of Alexandria provides a property tax exemption for solar energy equipment available to both residential and commercial property owners. The exemption is valued at 100% of the cost and installation of qualifying solar panels and is deducted from the assessed value of the property each year for a period of five years.

This means that for five consecutive years after installation, the full value added to your property by your solar system will not be subject to Alexandria city property taxes. For a typical residential solar installation costing $20,000–$30,000, this can represent hundreds of dollars in annual property tax savings.

Property owners must apply to the City of Alexandria’s Office of Real Estate Assessments to receive this exemption. This local incentive complements Virginia’s statewide solar property tax exemption, providing Alexandria solar owners with strong, layered protection against property tax increases resulting from their solar investment.

Virginia’s Shared Solar (Community Solar) Program allows utility customers to benefit from solar energy without installing panels on their own property. Participants subscribe to a portion of a larger, shared solar facility and receive credits on their electricity bills based on their share of the energy produced by that facility.

There are two subscription options: the Block Option, where customers purchase fixed blocks of solar energy (each block = 100 kWh, costing $2.013/month, with residential customers able to buy up to 5 blocks); and the 100% Match Option, which allows participants to match all of their electricity use with solar energy at an additional $0.02013 per kWh. Participants receive a guaranteed 10% savings on the subscribed portion of their utility bill.

This program is ideal for renters, homeowners with shaded or unsuitable roofs, or anyone who wants to support solar energy without the upfront cost of installation. No equipment purchase or installation is required — simply sign up through your utility. Contact the Virginia Department of Energy or your utility provider for current availability and enrollment details.

The Virginia Solar for All program was established after the Virginia Department of Energy was selected to receive more than $156 million through the U.S. EPA’s Solar for All grant competition. The program is specifically designed to expand access to solar energy for low-income and disadvantaged communities across the Commonwealth.

The funding is being used to develop long-lasting solar programs that enable qualifying households to deploy and directly benefit from distributed residential solar. This may include financial assistance, subsidized installations, community solar subscriptions, and other mechanisms to reduce or eliminate the upfront cost barrier for eligible residents.

Eligibility is targeted toward low-income households and residents of disadvantaged communities. Interested Virginia residents should contact the Virginia Department of Energy for the latest information on program availability, eligibility requirements, and how to apply as funds are deployed.

The VirginiaSAVES Green Community Program provides low-cost, low-interest financing to private commercial and industrial businesses, nonprofits, and local governments to fund a wide range of renewable energy and energy projects in Virginia. Solar panel installations are among the eligible project types under this program.

The program is designed to remove the financial barrier of upfront capital costs for organizations looking to invest in solar and clean energy. Financing terms and interest rates are structured to make projects economically viable, with the goal of shortening payback periods and improving the return on investment for participating organizations.

This program is not available to individual residential homeowners but is an excellent resource for business owners, nonprofits, and local government entities seeking affordable financing for solar installations. Contact the Virginia Department of Energy for current program terms, interest rates, and application details.

Virginia’s Commercial Property Assessed Clean Energy (C-PACE) program provides an innovative financing mechanism for commercial, industrial, and nonprofit property owners to fund solar energy and battery storage installations with no upfront costs. Project costs are repaid through a special assessment on the property’s tax bill, with repayment terms extending up to 30 years.

C-PACE financing can cover 100% of eligible project costs, including solar panels, battery energy storage systems, and related equipment. Because the financing is tied to the property rather than the borrower, it can offer more favorable terms than traditional loans and transfers to the new owner if the property is sold.

Availability is limited to localities in Virginia that have adopted the PACE enabling legislation. Commercial property owners should verify whether their locality participates before pursuing this option. C-PACE is particularly valuable for battery storage projects, which currently have no dedicated state or utility incentive programs in Virginia.