Top 5 Solar Companies in vermont

Below you’ll find the top solar companies in Vermont as ranked by us and reviewed by verified solar customers. To learn more about what goes into our “Best Rank” score for each company, visit our How We Rank page. For our full Vermont Solar Overview, keep reading:

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  • Solar Panels: Hanwha
  • Inverters: SolarEdge

Vermont Solar Overview

With some of the most expensive utility rates in the country, Vermont is rapidly becoming one of the best places to switch to solar energy. The state offers several incentive programs and solar-friendly policies to help make solar power both affordable and accessible to residents of nearly all budgets.

Solar customers in the Green Mountain State can go solar in multiple ways, enjoy a relatively fast payback period, and benefit from the 30 percent federal solar tax credit through purchase or loan.

Read on to learn more about the ins and outs of going solar in Vermont.

Pros and Cons of Going Solar in Vermont

Here's an at-a-glance description of the current benefits and drawbacks of switching to solar in Vermont:

Benefits of Going Solar in Vermont:

  • Strong Renewable Portfolio Standard
  • High Electricity Rate
  • Statewide Net Metering
  • Statewide Interconnection Rules
  • 100% Property Tax Exemption
  • 100% Sales Tax Exemption
  • Buy, Loan, Lease, and PPA

Drawbacks of Going Solar in Vermont:

  • No Solar Renewable Energy Credits
  • No Solar Carve-out
  • No Solar Power Rebate Program
  • No State-level Tax Credits

Cost of Solar in Vermont

Thanks to some incredibly high utility rates, going solar in Vermont has never made more sense. From the perspective of levelized cost, which divides total costs by total output over 25 years, solar is the clear winner: 7 cents per kilowatt-hour to traditional utility’s 44 cents per kWh. In other words, the savings from solar energy over the course of a solar PV system’s lifetime can reduce levelized utility costs by more than 60 percent!

In terms of upfront costs, a typical 5 kW system will cost approximately $19,000 (this number can be higher or lower depending on the system’s solar capacity, energy efficiency, and accompanying installation fees). The federal solar tax credit, good for 30 percent of the system’s upfront costs, will reduce that figure down to around $13,300 — still a huge investment, but one that will create huge savings in the long run.

Vermont Solar Financing Options

Vermont is one of the few states to provide four financing options to interested residents: cash purchase, solar loans, solar leases, and power purchase agreements:

Cash Purchase

Despite the significant upfront investment, cash purchase offers a number of advantages: in addition to access to the federal tax credit, customers will secure immediate ownership of their solar panel system, and receive the largest return on investment of any of the financing options.

Assuming a typical 5 kW system, customers will need to pay around $19,000 upfront. They will have 30 percent of that number, worth thousands of dollars, credited to them from the federal government after the first year. A solar panel system of this size will only take about 10 years to pay for itself through annual solar savings, leaving at least 15 years to yield pure profit for solar purchasers. After 25 years, the system will have produced nearly $20,000 in net profits and increased home value by an average of $12,000.

Solar Loan

Like cash purchase, solar loans give borrowers access to the federal tax credit, meaning they would have 30 percent of the solar power system costs returned to them after the first year. Even though borrowers will be paying around 4 percent interest each year, solar loans carry the advantage of requiring zero money down, meaning solar savings can begin right away.

To cover the costs of a 5 kW solar system, borrowers will need to secure a loan of around $19,000 with a 15-year repayment plan. After year 1, customers will have netted more than $5,000 in annual savings. This number will decrease slightly over the years, but the great news about solar loans in Vermont is borrowers will rarely, if ever, go into the red.

Once the loan is paid off after 15 years, the savings will start growing again. By year 25, borrowers will have accrued more than $13,000 in solar savings.

Solar Lease

Like solar loans, solar leases require zero money down. The key difference, however, is that a solar lease acts much like a rental agreement, meaning no solar array ownership for residents. In place of tens of thousands of dollars in installation and equipment fees, solar lessees will make low monthly payments, often at a lower rate than what the utility company charges.

Lessees will spend about $800 a year for a 5 kW system, but will save around $1,000 each year. For a 20-year lease, customers will have netted a little less than $10,000 in total savings.

Power Purchase Agreement (PPA)

A power purchase agreement (PPA) works much like a solar lease: same low monthly payments, same zero money down, and customers aren’t required to pay for installation or maintenance. The key difference is in what customers are actually paying for. As the name suggests, a power purchase agreement allows customers to buy the solar power the system produces, as opposed to renting the system components themselves.

The savings with a PPA are much the same to a solar lease. Through a PPA for a 5 kW system, customers will save an average of $27 per month, which will add up to less than $10,000 over 20 years. 

Vermont Solar Incentives

In Vermont, the only incentive programs for solar customers come in the form of tax exemptions. Solar power rebates, and state-level tax credits do not exist in Vermont. That said, the tax exemptions that do apply could result in hundreds of dollars of savings over the years:

Tax Exemptions

Vermont offers two tax exemptions for solar panel systems: sales tax and property tax. The sale tax exemption applies to the tax that would have been applied to the cost of the physical equipment (solar panels, solar inverters, rooftop mounting equipment, batteries, etc.). Considering the average solar panel system in the state goes for nearly $20,000, that exemption alone saves the homeowner hundreds.

The second exemption is property tax, which applies to the tax that would have been assessed to the property value increase brought on by the solar energy system. In Vermont, this property tax exclusion applies to all solar energy systems of up to and including 10 kW. 

Vermont Solar Policy Information

Policymakers in Vermont, meanwhile, are working hard to establish standards that promote solar adoption and make solar power more accessible to citizens:

Renewable Portfolio Standard (RPS)

A renewable portfolio standard (RPS) is a state’s goal to attribute a set portion of its energy to renewable resources (like solar power, wind energy, natural gas, etc.) by a set date. Many states also affix penalties to utility companies that fail to do their part.

In Vermont, the RPS is 75 percent by 2032, an incredibly lofty goal, but one the state feels confident in achieving. And while Vermont does not currently have a solar carve-out in place, as of 2020, the state currently attributes more than 14 percent of its total energy output to solar power alone.

Net Metering

Net metering is a policy usually mandated by the state but sometimes left to the discretion of the local power companies that credits solar users for the surplus electricity their solar PV system contributes to the utility grid. In Vermont, systems up to 15 kW (which covers most if not all residential solar installation projects), not only qualify for the full retail value of their solar energy, but are also credited with an additional $0.01 per kWh!

Interconnection Rules

A state’s interconnection rules refer to the standards that must be met before a solar energy system can connect to the grid. In some cases, these rules are set by utility companies and can result in costly additions like a separate home insurance or external disconnect switch. In Vermont, both of these conditions apply.

Vermont Solar Statistics

Vermont has maintained a fairly well-balanced solar installation portfolio across residential, commercial, and utility grade solar projects, peaking in 2018 with more than 80 cumulative mW of clean energy. To date, the state has installed more than 8,800 solar panel installations, sending renewable energy to more than 65,000 Vermont homes. The state hosts 60 solar companies employing 1,100 people.

Interested in a solar quote? Check out the top-ranked solar companies in Vermont and read reviews from verified solar customers.

Sources

  • solarpowerrocks.com/vermont/
  • solarreviews.com/solar-panels/vermont
  • seia.org/state-solar-policy/vermont-solar
  • solar-nation.org/vermont
  • solaractionalliance.org/solar-panel-installation/vermont/

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