The 30% federal residential solar tax credit expired at the end of 2025, but Vermont homeowners may still qualify for federally backed solar financing options.
Jump to insightIn Vermont, a typical residential solar panel system costs $31,024 before any incentives.
Jump to insightVermont has sales and property tax exemptions on solar equipment.
Jump to insightResidential solar panel incentives in Vermont
In addition to solar tax breaks, other assistance may be available to certain residents. However, Vermont does not currently offer a widely available statewide cash rebate or loan specifically for residential solar panels.
Sales tax exemption
Eligible renewable energy systems of up to 500 kilowatts (kW) are exempt from Vermont sales tax. The exemption also covers qualifying micro-combined heat and power systems of up to 20 kW and solar water-heating systems. Both grid-connected and off-grid systems may qualify.
Property tax exemption
Solar equipment with a capacity of less than 50 kW is exempt from state and municipal property taxes when the system is net-metered or is off-grid and provides electricity only to the property where it is installed. The exemption applies to the solar equipment, not the underlying land.
Energy storage systems with a capacity of less than 600 kilowatt-hours (kWh) are also exempt. Towns may approve additional property tax exemptions for other qualifying renewable energy systems.
Uniform capacity tax exemption
Solar systems smaller than 50 kW are exempt from Vermont’s uniform capacity tax. Battery storage systems smaller than 600 kWh are also exempt. Larger solar and standalone storage facilities may be subject to the tax.
Green Mountain Power Bring Your Own Device program
Green Mountain Power customers can receive an upfront rebate of up to $10,500 for enrolling an eligible home battery and allowing GMP to use some of its stored electricity during periods of high demand.
The incentive is based on the amount of power enrolled and the length of time the battery can discharge. Eligible models currently include Tesla Powerwall 2 and Powerwall 3, Enphase IQ batteries, FranklinWH systems and several other brands.
What to know about net metering in Vermont
Net metering lets you earn bill credits for extra solar power you send to the grid. Credit values vary based on your utility, system size and location, application date and renewable energy credit ownership. Unused credits expire after 12 months and may not cover every charge on your bill.
Vermont has a streamlined registration process for ground-mounted systems up to 25 kW and rooftop systems up to 500 kW. A certificate of public good is generally approved 15 days after a complete application is filed, unless the Vermont Public Utility Commission identifies an issue.
Systems larger than 15 kW need utility interconnection approval before registration, and ground-mounted systems over 25 kW follow a more detailed process.
When your panels are not producing enough electricity, you can still draw power from the grid. A battery can store extra solar power for later and may provide backup during an outage, but a solar battery typically costs $7,000 to $18,000 before incentives.
How much are solar panels in Vermont?
Before any financial incentives, solar panel costs in Vermont typically range from $13,833 to $27,666. Your system size greatly affects how much you pay overall. The typical residential solar system in Vermont is 11.2 kW.
How do you know whether a typical system is large enough for your home? Check the amount of electricity you used last year in kilowatt-hours (kWh). You’ll find this information in your electric company account dashboard online.
For a rough estimate, divide your annual electricity use by 1,200. For example, a home that uses 15,000 kWh per year might need a system of about 12.5 to 13 kW. An installer can provide a more accurate estimate based on your roof, shade and location.
Solar cost by system size in Vermont
| 5 kW | 6 kW | 7 kW | 8 kW | 9 kW | 10 kW | |
|---|---|---|---|---|---|---|
| Statewide average | $13,833 | $16,600 | $19,366 | $22,133 | $24,899 | $27,666 |
Mortgage options for financing solar panels
Some mortgage programs allow eligible borrowers to include the cost of energy-saving improvements in a home purchase or refinance loan. Solar eligibility, borrowing limits and other requirements vary by program and lender.
- FHA Energy Efficient Mortgages: Eligible borrowers may be able to finance cost-effective energy improvements as part of an FHA-insured purchase or refinance mortgage.
- VA Energy Efficient Mortgages: Eligible borrowers may be able to add up to $6,000 in approved energy improvements to a VA-backed purchase loan or certain refinance loans.
- Fannie Mae HomeStyle Refresh: This conventional mortgage option allows eligible borrowers to finance solar panels and other qualifying home improvements as part of a purchase or limited cash-out refinance. Improvement costs may total up to 15% of the home’s appraised value after the work is completed.
Find solar companies in Vermont
Good solar companies help you navigate local incentives, permitting and net metering policies. Compare our picks for Vermont’s top solar companies to learn more.
| Company | Customer rating | Pro install | Max panel efficiency | Panel warranty | Payment options | Year founded | |
|---|---|---|---|---|---|---|---|
 Sunrun | Learn More | 4.3 |  | 22% | 20 years | Cash, loan, lease, PPA | 2007 |
 ShopSolar | Learn More | 4.5 |  | Varies | Varies | Cash, loan | 2018 |
FAQ
Can I get free solar panels in Vermont?
Generally, no. However, you may be able to install solar with little or no upfront cost through a solar lease or power purchase agreement (PPA).
» FREE SOLAR PANELS: Are they really free?
How can I pay for solar panels?
You can pay cash, but many homeowners finance solar panels with a solar loan. It works a lot like any other type of loan — there’s an application and approval process, and you pay it back over time (with interest). You also have the option of getting a lease or power purchase agreement.
» SOLAR PANELS: Lease vs. buy
How much can I save with solar panels in Vermont?
On average, Vermont homeowners with solar panels avoid $41,197 in utility costs over 25 years. Your current electric bill is the starting point for assessing the financial benefits of transitioning to solar energy. Knowing your average energy consumption helps determine the size and capacity of the solar system you need. Once you know this, you can figure out potential savings and how long it should take for your solar installation to pay for itself.
How do I know if my house is a good candidate for solar?
It’s best to have plenty of unshaded roof space that faces south or west for optimal sun exposure. It’s also smart to upgrade any old, inefficient appliances first. Reducing your electrical loads now means you can get a smaller system, which will be cheaper.
The condition of your roof matters too — if it needs replacement soon, do that before installing solar panels. Installing solar panels on an old roof might mean you have to remove the panels, replace your roof and then reinstall the panels. This will cost around $5,000 for a 19-panel setup.
Solar photovoltaic (PV) technologies, more commonly known as solar panels, absorb sunlight and convert it into usable electricity. If your roof gets a lot of shade, your panels may not produce enough electricity to make solar worthwhile.
Is my HOA allowed to restrict solar panels?
Generally, no. Vermont law prevents HOAs and similar organizations from prohibiting residential solar panels. They may have limited rules about panel placement, but those rules cannot interfere with the system’s effective operation. Municipal bylaws also generally cannot regulate solar devices installed on flat roofs.
What has Vermont’s investment in solar been so far?
Total solar investments in the state amount to $949 million, according to the Solar Energy Industries Association.
Bottom line
Despite its small size, Vermont is a leader in renewable energy adoption, especially in the area of solar power. Solar installations have increased quickly across the state, bolstered by supportive state policies.
The ConsumerAffairs research team also conducted an in-depth analysis to determine how much it costs to go solar in Vermont and solar costs in other states. Turns out, it’s worth it for many homeowners, particularly in Vermont.
Solar costs and savings: Vermont and nearby states
| 6-kW system cost (before incentives) | 10-kW system cost (before incentives) | Typical system size needed* | Average cost per watt | Total utility power cost savings** | |
|---|---|---|---|---|---|
| Massachusetts | $18,536 | $30,893 | 7.3 kW | $3.09 | $155,464 |
| New Hampshire | $19,181 | $31,968 | 6 kW | $3.20 | $48,186 |
| New York | $16,641 | $27,734 | 6.9 kW | $2.77 | $57,678 |
| Vermont | $16,600 | $27,666 | 11.2 kW | $2.77 | $41,197 |
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- DSIRE, "Vermont Programs." Accessed July 28, 2026.
- Solar Energy Industries Association, "Vermont Solar." Accessed July 28, 2026.
- Vermont General Assembly, "Title 30: Public Service, Chapter 089: Renewable Energy Programs." Accessed July 28, 2026.
- Vermont Public Utility Commission, "Net-Metering." Accessed July 28, 2026.
- Vermont Department of Taxes, "Solar Plants Subject to the Uniform Capacity Tax." Accessed July 28, 2026.
