Virginia · Incentives
Virginia solar incentives in 2026
Virginia has no state income tax credit for solar, and the federal residential credit expired for systems placed in service on or after 1 January 2026. What Virginia does have is a mandatory property tax exemption for residential systems of 25 kW or less, additional local-option exemptions adopted by many counties, retail net metering, and statutory limits on what a homeowners association may restrict.
The property tax exemption, and why your county still matters
Section 58.1-3661 of the Code of Virginia treats certified solar energy equipment as a separate class of property and lets a locality exempt it from local taxation. Since 1 January 2023, following SB 686, there is also a mandatory state and local exemption for residential and agricultural solar facilities with a nameplate capacity of 25 kW or less. A typical rooftop system is therefore exempt wherever it sits in Virginia.
Above that threshold, and for the procedural detail, the locality is what matters. Counties including Loudoun, Fairfax, Prince William, Chesterfield, Hanover, Spotsylvania, Albemarle and Frederick, along with the cities of Winchester and Charlottesville, have adopted exemptions by ordinance. The amount, the duration and the paperwork differ between them.
Two examples of how real that procedural difference is. Fairfax County requires a certification application with plans, specifications, a narrative description of function and the documented installed cost including labour, filed with Land Development Services. Loudoun County ties the amount and duration of the exemption to the system’s nameplate capacity in DC watts, and will not process an application until the system is operating and has passed all required permits.
Net metering is the real incentive here
With no state credit and no federal credit, the economics of a Virginia system rest on what your utility pays you for the power you export. That is unusually good news at the moment, because one-for-one retail net metering survived a contested proceeding at the State Corporation Commission in April 2026 rather than being cut as proposed.
It is worth being blunt about the arithmetic this creates. A retail export credit means a correctly sized array that offsets your household’s annual consumption captures close to full value without needing storage to do it. That is a materially different design problem from the one we solve in South Carolina or Georgia, where exports are worth a fraction of retail and self-consumption is everything.
The size envelope changed in 2026 as well. HB 1255 raised the capacity above which a residential customer is billed a monthly standby charge from 15 kW AC to 20 kW AC with effect from 1 July 2026, though utility tariffs had not all caught up at the time of writing.
What an HOA may and may not do
Virginia gives homeowners a statutory position rather than leaving it to the covenant. Under SB 504, an association may impose only reasonable restrictions on rooftop solar, and the statute supplies bright-line tests for what is unreasonable: a restriction that increases the project’s cost by more than five per cent, or reduces its energy generation by more than ten per cent.
In practice the recurring argument is about street-facing panels, because a south-facing roof plane is frequently the one visible from the road, and moving an array off it is exactly the sort of change that can cross those thresholds. Having a numerical test rather than a matter of taste is what makes that argument winnable.
We prepare the architectural review packet as part of every installation, and we would rather design for approval than design something we know will be sent back. Where a genuine dispute arises, the five and ten per cent figures are the ground to argue on.
What Virginia gives you instead of a credit
Virginia has no state income tax credit for residential solar, which makes its incentive page shorter than most and its economics no worse for it. What applies instead is a property-tax exemption and, more importantly, an export position that does the work a credit would.
Residential solar of 25 kW or less is exempt from state and local property tax under §58.1-3661 as amended by SB 686, and many localities have adopted further exemptions by ordinance. Because local adoption varies, your own locality is worth checking rather than assuming the statewide position is the whole story.
Virginia has no general solar sales-tax exemption for residential systems. That is a real line item and one that quotes occasionally omit, so it belongs in your comparison rather than in a footnote. Confirm your own position with a tax professional.
The HOA protection is the strongest of the three states we work in
Under SB 504 a Virginia association may impose only reasonable restrictions on rooftop solar, and the statute defines "unreasonable" with numbers: a restriction is unreasonable if it raises project cost by more than 5% or cuts generation by more than 10%.
A numeric test is unusually useful, because it converts an argument about how a roof looks into an arithmetic question with a documented answer. Compare that with Georgia, where HB 389 only covers association rules created, renewed or modified on or after 1 January 2026, or South Carolina, which limits outright prohibition without setting a numeric standard.
In practice it means a Virginia submission can be built to the test. Documenting what a requested alternative layout would cost or give up turns the review into a comparison rather than a negotiation, and it is the reason we prepare that comparison at design stage rather than leaving it to a homeowner under time pressure.
How these rules change, and what that means for a 25-year decision
Export arrangements are set through processes that can be revisited, and in our three states they have been. That is not a reason to avoid solar; it is a reason to size a system that makes sense on today’s terms rather than one that only works if favourable terms hold for decades.
It is also a reason to be careful with any projection running twenty-five years on a single escalation assumption. Small differences in assumed rate rises compound into very large differences in a headline total, which is why two quotes for near-identical hardware can show totals tens of thousands of pounds apart. The assumption, not the equipment, is doing the work.
Where a system is grandfathered under earlier terms, that status usually attaches to the installation and its interconnection date rather than to the homeowner. If you are buying a house with an existing array, what applies to it is a question worth asking before closing rather than after.
We date the facts on these pages for the same reason. A policy page without a date is asking to be trusted indefinitely, and none of this is stable enough to deserve that.
The federal credit, and why so much of what you have read is wrong
The 30% federal residential clean energy credit expired for systems placed in service on or after 1 January 2026. Not reduced, not deferred: expired. Any article, calculator or quote that still subtracts it is describing a position that is no longer available, and the error is usually worth several thousand dollars on a typical residential system.
This matters more than a normal content-freshness problem because of how solar is researched. Most homeowners read two or three national comparison sites before speaking to anyone, and a large share of that material has not been revised. Arriving at a quote with a net cost already in mind that is thousands of dollars too low makes every subsequent conversation harder, and it is not the installer’s error.
The practical advice is narrow and useful: before you compare anything, check whether a federal credit has been applied. If it has, the comparison is not valid and the figures need redoing rather than adjusting.
Virginia FAQ
Common questions about solar in Virginia
Is there a Virginia state tax credit for solar in 2026?
No. Virginia offers no state income tax credit for residential solar. The incentives that do exist are the mandatory property tax exemption for systems of 25 kW or less, local-option exemptions adopted by many counties, and retail net metering.
Do I pay property tax on solar panels in Virginia?
For a residential system of 25 kW or less, no. Section 58.1-3661 as amended by SB 686 provides a mandatory state and local exemption from 1 January 2023. Above that capacity, whether an exemption applies depends on whether your locality has adopted one by ordinance, and the amount and duration vary. Confirm your own position with your commissioner of the revenue and a tax professional.
Can my HOA stop me installing solar in Virginia?
Not outright. Under SB 504 an association may impose only reasonable restrictions, and a restriction is unreasonable if it raises project cost by more than five per cent or cuts generation by more than ten per cent. We prepare the review packet as part of every install.
Is the 30% federal solar credit still available in Virginia?
No. The federal residential clean energy credit under Section 25D expired for systems placed in service on or after 1 January 2026. Any quote still applying it is wrong, and the difference runs to thousands of dollars. Confirm your own tax position with a professional.
The other half of the Virginia picture
Incentives are only one side of the arithmetic. What your utility pays for the power you export is usually the larger side, and in Virginia it varies by provider rather than by city.
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Find out what this means at your Virginia address
Policy sets the frame. Your utility, your roof and your usage set the answer. A free assessment gives you real numbers rather than a state average.
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