VermontVermont is a Northeastern state that receives subpar sunlight throughout the year. The state gets roughly 4 kilowatt-hours per square meter of sunlight per day.

Even though the state doesn’t have the solar capabilities of other states like Arizona and California, it’s a leader when it comes to solar and renewable energy utilisation.

The state is making sound investments that will make it an energy independent state, focusing on renewables like solar and biomass.

The residents of Vermont are offered numerous measures to help them become energy independent. This includes grants, incentives, rebates and loans.


Vermont has one of the highest targets in the nation for renewable energy generation. The state aims to produce 90% of all its electricity needs from renewable means by 2050. This means that all stakeholders, including homeowners, must do their due diligence to meet this goal.

Sun on Solar PanelsVermont has been able to set up over 100 MW of solar power. This is five times what Maine has. Solar is a viable option in Vermont because it makes a lot of money in terms of savings.

For an average household, a 5 kW system is more than enough to meet the house’s daily requirements. The average cost of a solar PV that size is $15,000. Because solar PVs start generating electricity after solar installation in Vermont, it is expected you start earning savings from the onset. You can save up to $840 in the first year.

After factoring in all the tax cuts and incentives, the payback period for the system is around 10 years. The short payback period can be attributed to the high cost of electricity in the state.

The price of electricity is outrageously high at 17.5 cents per kWh. The average electricity price in the nation is 12.5 cents per kWh, making the electricity price 30% higher in Vermont.

The high cost of electricity is also a significant incentive for homeowners to switch to solar to save on utility bills.

Vermont is taking giant leaps to advance renewable energy generation. Its policies have been a leader for green energy around the nation, setting a precedent for others to follow. Here are the solar panel laws in Vermont.

Vermont Renewable Portfolio Standard

The state of Vermont doesn’t have an ordinary Renewable Portfolio Standard (RPS). Before 2015 it was called Sustainably Priced Energy Enterprise Development (SPEED) program.

This program had stated the required percentages of renewable energy generation that utilities had to meet. This program was not punitive, and utilities were not fined if they didn’t reach their targets.

SPEED has, however, been replaced by Renewable Energy Standard (RES), which is quite similar to the ordinary RPS. The state of Vermont, through the RES, aims to achieve 90% of energy generation using renewable means by 2050. The RES also fines utilities that fail to meet their targets.

Federal Solar Tax Credit

When you buy a solar PV, the federal government allows you to cut 26% of the total cost of installation from taxes. This incentive is also known as Investment Tax Credit (ITC). This is the highest amount of savings you can receive in your quest to go solar.

Your installation’s total cost includes the solar panels, installation costs, permits, and other auxiliary components. If you pay $20,000 to have a solar PV installed, you are entitled to a $5,200 tax credit.

You can redeem the whole amount in the first year of installation. If you do not pay enough taxes to warrant you to redeem the entire amount in one year, you can split the amount over subsequent years till you are fully compensated.

The tax credit is only applicable to homeowners who buy whole solar PV systems at once, either by cash or through a solar loan. To reap maximum savings, it is recommended that you purchase the entire system using cash. If you are low on funds, you can take a loan, redeem the tax credit, and use the cash to pay the loan’s first instalments.

Net Metering in Vermont

Solar Panel InstallerVermont being a champion in the renewable energy sector has a robust net metering policy. This policy is beneficial to homeowners as it allows them to get maximum value for their investment.

Net metering allows users who have upgraded to solar power to remain connected to the grid. When your solar power produces more energy than your household needs, the extra energy is adopted by the grid and used to serve another load.

When you send electricity to the grid, your utility provider gives you credits that can be used to offset your bill.

When your solar panel isn’t producing enough energy to power up your household, i.e. at night or wintertime, you can draw power from the grid to meet the deficit.

The credits you have earned are netted off your consumption bill. This means you get to use the grid like a battery for your solar PV system.

Vermont requires that utilities charge credits at a rate that is close to the retail price.

Vermont Tax Exemptions

The state of Vermont exempts solar from being taxed in property taxes.

When you install a solar system, it increases your house’s value by an average of $15,000. Solar isn’t included when valuing your home.

The state has also exempted solar from sales tax. This means you pay for your solar PV system at a discount because of the exempted sales tax.

Map image by Wikimedia Commons User: TUBS / CC-BY-SA-3.0