Solar Incentives in Vermont (2026)

Vermont residents installing rooftop solar can combine the 30% federal Investment Tax Credit (ITC) with no additional state-level income-tax credit. Net-metering rules and property/sales tax exemptions are the other big levers.

Gross install cost (6 kW)$19,800

After federal ITC (30%)$13,860

Vermont avg installed cost: $3.30/watt (state avg, 2026). Federal ITC value: $5,940. Additional state incentives (below) may reduce net cost further.

1. Federal Investment Tax Credit (ITC)

Every U.S. state gets the 30% federal ITC. It applies to the gross install cost, including panels, inverters, labor, and permit fees. For a 6.0 kW system in Vermont at $3.30/watt, that’s a credit of $5,940 against your federal income tax. The credit is refundable-carryforward — unused portions roll to future tax years. Valid through 2032.

2. State income-tax credit

None

3. Net metering rules in Vermont

Yes, adder above retail (~$0.037/kWh)

Net metering determines how much you’re credited for excess solar energy exported to the grid. "1:1" or "full retail" is the best — you get the same rate you pay. "Avoided cost" or "net billing" pays substantially less (often 25-50% of retail).

4. Property & sales tax exemptions

Property tax: ✅ Yes — the added home value from solar is excluded from property tax reassessment in Vermont.
Sales tax: ✅ Yes — solar equipment is exempt from state sales tax in Vermont, saving typically 5-8% of gross cost.

5. Utility rebates & notes

Green Mountain Power storage rebate for Powerwall + solar.

Utility rebates change frequently. Verify current terms with your specific utility (not just "the state") before signing an installer contract.

Bottom line for Vermont

A typical 6.0 kW rooftop system in Vermont costs about $19,800 gross → $13,860 after the federal ITC. With Vermont’s electricity rate of 24.56¢/kWh, this system saves about $1,594/year — paying back in 8.7 years on the federal credit alone. Add the state-level items above and the net cost drops further.

See the full Vermont solar savings calculator →

Before you sign an installer contract

Affiliate links — we may earn a small commission at no cost to you.

Sense whole-home energy monitor — see which loads to size solar for
Solar installation guide (DIY/consumer reference)
EcoFlow Delta portable power — bridge to solar without full install

FAQ

Can I combine federal ITC and Vermont’s state incentives?

Vermont does not have a state solar income-tax credit, so there is nothing to combine at the state level. The federal ITC stands alone.

When do I get the federal ITC money?

The ITC reduces your federal income-tax liability for the year the system is placed in service (i.e., commissioned and producing power). If your tax owed is less than the credit, unused portions roll forward. You do not receive a check.

Do rebates and credits get taxed?

Rebates from utilities are generally not taxable (they reduce your cost basis). Federal tax credits are not income. Some state credits may be treated differently — check your state Department of Revenue.