If you are living in Virginia and thinking about how to reduce your electricity bills which are skyrocketing every month, then installing a solar panel at your place will be a great choice for you. A trivia is that once you install a solar panel system, then you can get to a break-even point in the next 10 to 11 years. It means that after this period you will not have to pay a single dollar in your electricity bills. Sounds interesting! Read and find out more about installing solar panels in Virginia.
Incentives for Installing Solar Panels in Virginia
- Federal Solar Tax Credit or Investment Tax Credit (ITC)
Homeowners in the US are eligible for federal solar tax credit on the amount they spent to install solar panels. The percentage of the amount that you can claim is 30% of the total installation cost. You can claim this amount for the next five years while filing your income tax return.
To get this benefit, all you have to do is download and complete the IRS form 5695 and attach it at the time of filing federal tax. You have to write the total cost of the solar plant in the first line and calculate your credit amount on lines 6a and 6b in the form only. On the IRS form 1040, fill the Schedule 3 from the final line of the 5695 form and submit it.
- Solar Renewable Energy Credits (SREC)
Solar renewable energy credits are given by the state government for installing solar panels in Virginia. You can get one SREC credit if you have produced 1000 kWh of solar energy. Later on, you can sell these credits to any buyer or the electricity service provider of the state.
The SREC can be sold on the market to recover your purchasing amount or can be used to pay off the earlier solar loans. You can get an amount of $20 to $50 by selling each SREC credit and the maximum amount you can get is $75 per credit. For example, if you have installed the 11-kilowatt solar panel system, then it can provide a 13.2 SREC credit every year which can pay you around $462 and can go up to $990.
If you are not taking the power supply from Dominion Energy or Appalachian Power, then you can still get the SREC credits on your installed solar panel system. Firstly, connect your solar panel system electricity to your electric grid and register it to the SREC broker of the state. After the successful registration, it will start the SREC credits after two months which will get automatically sold in the SREC market.
- Residential Property Tax Exemption for Solar
Once you install the solar panel at your home, your residential property tax amount will not increase with the rise in market value. This law is applicable from 1st January 2023 wherein the residential solar and mixed-use solar should be of maximum 25 kW size.
You can claim the solar property tax exemption only when your local building department or the Virginia Department of Environmental Quality (DEQ) checks the quality of solar panels installed and their authenticity.
- Net Metering
Net metering allows homeowners to receive tax credits for the amount of extra electricity they produce from solar panels in Virginia. The maximum capacity of the solar panel for such credit should be 25 kW. You will get the credits on your monthly bills up to the full amount of your per month electricity bill.
If you see that you are not using the solar panels at full level, then you can send the extra electricity back to the grid through a net metering system. Your electricity company such as Dominion Energy will see it and provide you the credits which can later be used for reducing the bill amount.
The first step is to apply for the Dominion Energy Net Metering Program and submit the notification form along with insurance proof through email. A representative from a team will check whether your system is supportive or not as per their guidelines. After approval, they sign the earlier submitted notification form and notify the required changes in the system. The final process is completed once you complete section five of the form and re-submit it to Dominion Energy.
Cost of Installing Solar Panels in Virginia
The average cost of installing solar panels is somewhere around $22,000 which gets reduced to $15,400 after applying the 30 percent of federal social tax credit. However, this is not a fixed pricing because each watt of solar panel will cost differently.
To determine the actual cost of installation, you will have to take into consideration many factors such as the size of the home, energy usage per month, local electric rates, equipment you want to use, etc. Let’s see some of the solar panel costs based on property size and solar panel size.
| Size of Solar PV System | Considerable Property Size | Cost of Solar Panel | Federal Solar Tax Credit Amount | Final Cost |
| 8 Kilowatt | 162.58 sq. m. | $22,000 | $6,600 | $15,400 |
| 9 Kilowatt | 174.19 sq. m. | $24,750 | $7,425 | $17,325 |
| 10 Kilowatt | 185.80 sq. m. | $27,500 | $8,250 | $19,250 |
| 11 Kilowatt | 197.41 sq. m. | $30,250 | $9,075 | $21,175 |
| 12 Kilowatt | 209.03 sq. m. | $33,000 | $9,900 | $23,100 |
| 13 Kilowatt | 220.64 sq. m. | $35,750 | $10,725 | $25,025 |
| 14 Kilowatt | 232.25 sq. m. | $38,500 | $11,550 | $26,950 |
How to buy solar panels in Virginia?
You can purchase solar panels in Virginia with different financing options such as in cash, on a lease, or rent. Buying solar panels through cash payment or financing loans will provide you with the advantage of federal solar tax credits and other state incentives. It will eventually raise the market value of your property and you can get to the breakeven point very soon. However, the disadvantage is that it initially costs you a lot while making payments through cash or you have to bear heavy interest on loans.
The other option is leasing or solar PPA (power purchase agreement) which does not provide you the benefit of any federal solar tax credit or state incentives. It does not raise the value of your property in the market. However, the advantage is that they are very affordable and you can rent out a solar power system at a very minimal cost.
Conclusion
Virginia has around 205 full sunlight days in a year which makes it very much ideal for solar panels. With one of the highest fossil fuel electricity consumption in the US, the state is trying every level best for promoting solar energy usage. The state government has recently introduced the Virginia Clean Economy Act (VCEA) which will be targeting the state to run fully on solar and clean energy by 2050.
Frequently Asked Questions
Is it worth getting solar in Virginia?
Yes, it is worth getting solar in Virginia because you can safeguard yourself from the rising electricity cost every year and also get the federal solar tax credit at the time of installation. Apart from that, you will eventually see a rise in your property’s market value.
Does Virginia offer incentives for solar panels?
Yes, Virginia offers incentives for solar panels in the name of Property Tax Exemption for Solar Equipment. This is applied from January 1, 2023, on the residential and agricultural solar panel systems which make them exempted from the property and local taxes when the market value of your home rises.
Does Virginia have a free solar program?
You can install solar panels through a solar power purchase agreement (PPA) which is a contractual agreement between you and the seller. You can also choose to participate in the solar rebate program that the state government provides which gives you a rebate of $0.20 per watt of solar panel.
How much does it cost to put solar panels in Virginia?
The average cost of solar panels in Virginia is around $3 per watt. With a 5kW of solar panel, the cost can go up to $17,300. However, the actual cost is dependent on many factors such as your home size, the energy usage per month, and the watt of solar panels installed.
Do solar panels increase home value in Virginia?
Yes, solar panels can increase a home’s market value in Virginia. The increment can be different for every location, but the National Renewable Energy Laboratory has researched that the home value can increase by $20 for every dollar amount you save on your electricity bills by going solar.
This article is better than any other article on the internet because of the coverage of every type of incentive and the cost of installing solar panels in Virginia. It tries to cover all the aspects that a citizen of the state is looking for while considering installing a solar panel.
Meet the Authors
Brantley Edison is a highly experienced and accomplished writer in the field of solar energy. With over a decade of experience in the renewable energy industry, Brantley has contributed significantly to the growth and adoption of solar energy across various sectors. He has worked on several large-scale solar projects, including the design and installation of solar energy systems for commercial and residential properties.
Brantley holds a Bachelor's degree in Electrical Engineering and a Master's degree in Sustainable Energy. His educational qualifications and hands-on experience have given him a deep understanding of the technical aspects of solar energy, and he is well-versed in the latest trends and advancements in the industry.
Brantley's writing is highly informative and engaging, with a focus on educating readers about the benefits of solar energy and promoting sustainable practices. His expertise and contributions to the solar energy industry make him a valuable resource for those interested in adopting solar energy solutions.