As of July 2026, Vermont solar pays off mainly through net metering, not a state cash rebate. A new Vermont home system is credited for the power it exports at about 14 cents per kWh once the siting adjustor is applied, built on the Public Utility Commission’s statewide blended residential rate of $0.18398 per kWh and a renewable energy credit adjustor (VT PUC). Older systems from before 2017 were grandfathered near 22 to 25 cents, which is why stale guides mislead new buyers. According to MySolarFY’s July 2026 analysis, a typical 8 kW rooftop system in Green Mountain Power territory makes about 9,772 kWh a year and returns roughly $1,700 to $2,200 in first-year value, since power used on-site offsets Vermont’s 24.56 cents per kWh retail rate (EIA, as of April 2026). With the 30% federal credit gone after 2025, a cash system’s simple payback now runs into the low-to-mid teens in years.
Vermont is a small, high-rate power market with one dominant utility: Green Mountain Power (GMP) serves about three-quarters of the state’s electric customers, with Vermont Electric Cooperative, Burlington Electric Department, and a set of smaller municipal utilities covering the rest. For how the utility credits what your panels export, see our guide to Green Mountain Power net metering. Homeowners here pay about 24.56 cents per kWh for electricity (EIA retail sales, residential VT, as of April 2026), well above the national average, so every kilowatt-hour your roof makes offsets an expensive bill. This page is straight about what Vermont actually offers in 2026, where the net-metering credit recently tightened for new systems, and how GMP’s battery program stacks on top.
Why solar pays in Vermont
High rates carry the math here, and net metering does the rest. At about 24.56 cents per kWh, a Vermont home with a $130 to $220 monthly bill offsets expensive grid power with every kilowatt-hour the roof makes. Vermont does not hand out an upfront state solar rebate or a state solar income-tax credit for a homeowner-owned system, so the economics lean on bill offset, net-metering credits, and, if you add storage, Green Mountain Power’s battery incentives. Your production drives those savings, so estimate your roof’s likely output with NREL’s free PVWatts calculator; actual output depends on your roof’s pitch, orientation, snow, and shading.
Vermont solar incentives at a glance
Here is what is real in Vermont in 2026, what each mechanism pays, and who qualifies. Every figure links to its source.
| Mechanism | Value in 2026 | Who qualifies | Source |
|---|---|---|---|
| Net metering (new system) | Exports credited at about 14 cents per kWh, all-in, when you transfer RECs to the utility | Any residential net-metering customer (Category I, 15 kW or less) | VT PUC |
| REC transfer adder | +$0.03 per kWh if you transfer your renewable energy credits; a negative adjustor if you keep them | Every net-metering customer chooses | VT PUC |
| GMP battery incentive (BYOD) | $850 per kW (3-hour) or $950 per kW (4-hour), up to about $10,500 | GMP customers who buy a battery and share it during peaks | Green Mountain Power |
| State sales-tax exemption | Solar equipment is exempt from Vermont’s 6% sales and use tax (Form S-3E) | Any buyer of qualifying solar generating equipment | Vermont Department of Taxes |
| Property-tax exemption | Net-metered systems under 50 kW are exempt from municipal and state education property tax on the equipment | The property owner (land stays taxable) | Vermont Department of Taxes |
| Federal residential (Section 25D) | The 30% homeowner credit ended for expenditures after December 31, 2025 | No 2026 homeowner-buyer | IRS |
- 24.56 cents per kWh, Vermont residential electricity rate, as of April 2026 (EIA).
- About 14 cents per kWh, all-in net-metering credit for a new residential system that transfers its RECs, built on the $0.18398 per kWh statewide blended residential rate less the siting adjustor (VT PUC).
- Roughly 22 to 25 cents per kWh, the grandfathered rate for legacy systems installed before 2017, no longer available to new systems (VT PUC).
- Up to about $10,500, Green Mountain Power battery incentive under the Bring Your Own Device program, paid as bill credits (GMP).
- About 9,772 kWh a year, production a typical 8 kW rooftop system makes in the Burlington area (MySolarFY estimate from an NREL PVWatts run, July 2026).
- 0% Vermont sales tax on qualifying solar equipment (Vermont Department of Taxes).
The honest part first: Vermont has no upfront state solar rebate. Some out-of-state guides still list a Vermont “solar rebate” or quote the old, higher net-metering rate as if it applies to new systems. Neither is true for a system you install in 2026. The value here is the electricity you stop buying, the net-metering credit on what you export, the sales-tax and property-tax exemptions, and GMP’s battery incentive if you add storage. Confirm every figure against the linked source before you sign.
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Net metering in Vermont, and the rate cut for new systems
This is the number most Vermont homeowners get wrong. Vermont net metering does not credit your exports at the full retail rate. Power you use in the house as it is made offsets electricity at your retail rate, about 24.56 cents per kWh. Power you send back to the grid is credited under the Public Utility Commission’s net-metering tariff, which starts from a statewide blended residential rate of $0.18398 per kWh and then applies two adjustors (VT PUC). A renewable energy credit (REC) adjustor adds $0.03 per kWh if you assign your RECs to the utility, or subtracts a similar amount if you keep them. A siting adjustor then applies by system category. For a typical residential system (Category I, 15 kW or less) that transfers its RECs, the all-in credit lands at about 14 cents per kWh.
New systems earn less than the legacy ones you read about. Systems installed before 2017 were grandfathered at roughly 22 to 25 cents per kWh, and many older guides still quote those numbers. For systems whose applications were received on or after August 1, 2024, the Commission raised the blended rate but cut the siting adjustor, for a net reduction of about $0.007 per kWh compared with the prior vintage (VT PUC, Case 24-0248-INV). That is the “rate cut” you may have heard about: real, but modest, and legacy systems keep their original terms. The Commission’s 2026 biennial review is in progress, so today’s credit follows the last order in force; confirm the current tariff with your utility before you size a system. For the mechanics of how export credits work in general, see how net metering credits your solar exports.
| What the meter does | What it is worth |
|---|---|
| Solar you use on-site as it is made | Full retail rate, about 24.56 cents per kWh |
| Exports, new residential system, RECs transferred | All-in credit of about 14 cents per kWh |
| Exports, legacy system installed before 2017 | Roughly 22 to 25 cents per kWh, grandfathered |
Is solar worth it in Vermont in 2026?
For most owner-occupied Vermont homes with decent sun, yes, though the payback is longer now that the federal credit has ended. Here is how MySolarFY estimates it for a typical 8 kW system, so you can see the inputs rather than trust a single headline number. Your own quotes will move these figures, so treat this as a starting frame, not a guarantee.
| Input (MySolarFY estimate, July 2026) | Value |
|---|---|
| System size | 8 kW rooftop |
| Annual production (PVWatts, Burlington) | About 9,772 kWh |
| Typical installed price, sales-tax exempt (assumed near $3.20 per watt) | About $25,600 |
| First-year value (about 40% used on-site at 24.56 cents, about 60% exported near 14 cents) | Roughly $1,700 to $2,200 |
| Simple payback (25D credit ended 12/31/2025, not included) | About 12 to 15 years |
Two things move this the most: how much of your production you use in the house rather than export, and the installed price you are quoted. A battery enrolled in Green Mountain Power’s program can add bill credits on top, and financing changes the cash-flow picture. Run your own numbers with real quotes before you decide.
Vermont utilities: who serves you changes the details
Vermont is unusually concentrated. Your utility sets your retail rate, runs your interconnection, and, in Green Mountain Power’s case, runs a battery program the others do not match.
Green Mountain Power (GMP)
GMP serves about three-quarters of Vermont, more than 270,000 customers across most of the state. It runs the state’s standard net-metering tariff plus two home-battery paths. Under its Bring Your Own Device program you buy your own battery and enroll it, earning $850 per kW for a 3-hour sharing commitment or $950 per kW for a 4-hour commitment, with an extra $100 per kW in targeted grid areas, up to about $10,500 in bill credits (GMP Bring Your Own Device). If you would rather not buy the battery, GMP also leases two Tesla Powerwalls for a 10-year term at $55 per month or one payment of $5,500 (GMP Energy Storage lease). Program terms change, so confirm your rate and current battery offer directly with GMP. A dedicated Green Mountain Power solar guide is on the way.
Vermont Electric Cooperative, Burlington Electric, and the municipals
Vermont Electric Cooperative (VEC) is a member-owned utility serving much of northern and northeastern Vermont, around 32,000 members, and sets its own net-metering and storage terms (VEC net metering). Burlington Electric Department (BED) serves about 21,000 customers in the city of Burlington and runs its own incentives. For how BED’s own rate and net metering change the math on a Burlington rooftop, see our Burlington, VT solar guide. Vermont also has a string of small municipal utilities, from Stowe to Lyndonville. The statewide net-metering framework applies across them, but the battery incentives, rates, and interconnection steps differ, so confirm the specifics with whoever sends your bill.
What Vermont does NOT have in 2026
Clearing out the myths matters as much as listing the real programs, because stale guides cost homeowners money.
- No upfront state solar rebate. Vermont does not pay a per-watt cash rebate for going solar. Any quote that includes one is out of date.
- No state solar income-tax credit for homeowners. Unlike New York or Massachusetts, Vermont has no personal income-tax credit for a home solar purchase. A separate credit exists only for qualifying business installations.
- No full-retail net metering for exports. Exported power is credited at about 14 cents per kWh for a new system, not your full 24.56 cents per kWh retail rate.
- No 30% federal homeowner credit in 2026. The Section 25D credit ended for expenditures made after December 31, 2025 (IRS).
How you pay changes which incentives you keep
In Vermont the ownership question decides who keeps the RECs. The 30% federal homeowner credit (Section 25D) ended after December 31, 2025, so the only federal credit left in play is the commercial one a leasing company may claim on a system it owns.
| How you pay | Up-front cost | Who owns the system | RECs | Net metering |
|---|---|---|---|---|
| Cash | Full system price | You | You choose to keep or transfer | Yours |
| Solar loan | Little or none, financed over time | You | You choose to keep or transfer | Yours |
| Lease or PPA | $0-up-front where you qualify | A third-party company | The company usually keeps them | Yours, since credits follow the account |
If you own the system (cash or loan), you keep the net-metering credits and decide whether to transfer or retain your RECs, which sets whether the $0.03 per kWh REC adder applies. If you lease or sign a PPA, the company that owns the panels usually keeps the RECs, and your benefit is a lower or fixed power price with no up-front cost, while net-metering credits still apply to your account. Neither path gives a 2026 Vermont homeowner the federal residential credit, since that credit ended after December 31, 2025. For a deeper payback comparison, see the financial case for whether solar panels are worth it, and to see how the credit lowers your monthly cost, read how solar lowers your electricity bill.
What changed federally, and what it means for Vermont
The federal homeowner credit is gone, and Vermont never had a big state rebate to lean on. The 30% federal Residential Clean Energy Credit (Section 25D) ended for expenditures made after December 31, 2025, under the One Big Beautiful Bill Act, so a Vermont homeowner who buys solar with cash or a loan in 2026 cannot claim it (IRS OBBB FAQ; SEIA). Vermont’s net metering, its sales-tax exemption, its property-tax exemption, and GMP’s battery incentives were not affected, so the in-state value is unchanged even though the federal credit is gone. For the full timeline, see what the federal solar tax credit change means in 2026.
One federal exception exists, and it is not yours to claim. A separate commercial credit, Section 48E, is claimed by the business that owns a leased or PPA system, not by the homeowner, and it runs for projects placed in service through 2027, with a begin-construction safe harbor by July 4, 2026 (IRS Clean Electricity Investment Credit; SEIA tax policy). For a leased system in Vermont you do not file for a federal credit yourself; the company that owns the panels does. The 25D homeowner credit, by contrast, ended after December 31, 2025.
How to choose a solar installer in Vermont
Vermont has a solid market of licensed installers. Rather than chasing a “best” list, screen any installer against objective criteria:
- NABCEP certification, the industry’s professional standard for PV installers.
- Proper Vermont licensing and any required local electrical and building permits.
- A clear workmanship and equipment warranty in writing.
- Real Vermont experience, verifiable reviews, and help filing your net-metering registration and any GMP battery enrollment.
- A written production estimate and a transparent quote you can compare. For a checklist, see the right questions to ask a solar installer.
MySolarFY matches you with licensed installers that serve your area so you can compare real local quotes side by side, with no obligation. For neighboring markets, see our state-by-state solar guides and hubs like New Hampshire solar incentives and Maine solar and net energy billing.
Frequently asked questions
What solar incentives does Vermont offer in 2026?
Vermont’s main benefit is net metering. A new residential system’s exports are credited all-in at about 14 cents per kWh, built on the statewide blended residential rate of $0.18398 per kWh, a $0.03 per kWh adder for transferring your renewable energy credits, and a siting adjustor (VT PUC). Solar equipment is exempt from Vermont’s 6% sales tax, and net-metered systems under 50 kW are exempt from property tax on the equipment. Green Mountain Power customers can also earn up to about $10,500 in battery incentives under its Bring Your Own Device program. Vermont does not offer an upfront state rebate or a homeowner solar income-tax credit.
How does net metering work in Vermont?
Power you use on-site as it is generated offsets electricity at your full retail rate, about 24.56 cents per kWh. Power you export is credited under the Public Utility Commission tariff: a $0.18398 per kWh statewide blended residential rate, plus a $0.03 per kWh adder if you assign your RECs to the utility (or a similar subtraction if you keep them), then a siting adjustor by category. For a typical residential system transferring its RECs, that works out to about 14 cents per kWh all-in (VT PUC). Systems applied for on or after August 1, 2024 earn about $0.007 per kWh less than older systems. The 2026 biennial review is ongoing, so confirm the current tariff with your utility.
What is Green Mountain Power’s battery program worth?
Under GMP’s Bring Your Own Device program you buy your own home battery and enroll it, earning $850 per kW for a 3-hour sharing commitment or $950 per kW for a 4-hour commitment, plus an extra $100 per kW in targeted grid areas, up to about $10,500 in bill credits (GMP). GMP also leases two Tesla Powerwalls on a 10-year term for $55 per month or a single $5,500 payment. Terms change, so confirm current program details with GMP before you buy.
Does Vermont tax solar?
Barely. Vermont exempts qualifying solar generating equipment from its 6% state sales and use tax, claimed with Form S-3E, so you pay no sales tax on the panels and related components (Vermont Department of Taxes). Net-metered systems under 50 kW are also exempt from municipal and statewide education property tax on the equipment, though the underlying land stays taxable, so check with your town assessor (Vermont Department of Taxes).
What happened to the federal solar tax credit?
The 30% federal Residential Clean Energy Credit (Section 25D) ended for expenditures made after December 31, 2025, under the One Big Beautiful Bill Act. A Vermont homeowner who buys solar in 2026 with cash or a loan cannot claim it. A separate commercial credit (Section 48E) can apply to leased and PPA systems, but the business that owns the system claims it, not the homeowner. Vermont’s net metering, sales-tax exemption, and GMP battery incentives were not affected.
Do I qualify for Vermont solar benefits if I lease or sign a PPA?
Net metering follows the utility account, so you get the bill credits whether you own, lease, or sign a PPA. The RECs and any federal commercial credit go to the system owner, so on a lease or PPA the company usually keeps the RECs, while your benefit is a lower or fixed power price with no up-front cost. Because Vermont has no upfront state rebate to capture, the ownership question mostly comes down to who keeps the RECs and whether you want to add a GMP-eligible battery.
Reviewed by SolarFY Editor. Figures were verified against the linked Vermont (VT Public Utility Commission Case 24-0248-INV, Vermont Department of Taxes), Green Mountain Power, EIA, and IRS sources as of July 2026; Vermont’s net-metering biennial review is ongoing and programs and tariffs change, so confirm current terms with each source before you decide. MySolarFY does not provide tax or financial advice; consult a licensed professional about your own situation. See our data and methodology for how we source rates, production, and incentives.
MySolarFY is a free service that matches homeowners with licensed solar installers. We are not an installer, financing company, or government program. “No up-front cost” refers to qualifying lease or PPA financing, where eligible homeowners may have no out-of-pocket cost at installation. Lease and PPA terms typically run 20 to 25 years, may include an annual price escalator, and total payments may exceed the cost of a cash purchase. Homeowners do not get the federal residential credit that ended after December 31, 2025. Solar panels are not free and monthly payments apply. Eligibility, savings, incentives, and rates vary and are not guaranteed. See our full disclaimer.
