Local Option - Residential Property Tax Exemption for Solar
Administered by Virginia Department of Energy
If you install solar equipment in participating Virginia localities, your system may be exempt from local property taxes—the exemption is now automatic statewide for residential and agricultural solar systems up to 25 kW as of January 2023. Your solar installation must be inspected and certified by your local building department or the Department of Environmental Quality to determine the system's value for tax purposes. Contact your locality's assessor to confirm whether your jurisdiction participates and what documentation you need to submit.
You can serve customers in Virginia's growing list of participating cities and counties (11 cities and 18 counties currently offering exemptions) by highlighting that solar installations may avoid local property taxation, reducing the customer's long-term cost of ownership. Ensure installations are designed to meet the state's broad definition of solar equipment—photovoltaic, thermal heating, or passive solar systems—and coordinate with the local building department or Department of Environmental Quality for mandatory inspection and certification before the exemption applies. As of January 2023, residential systems up to 25 kW automatically qualify statewide.
Virginia's local-option solar property tax exemption allows counties and cities to exempt solar equipment from taxation; as of January 1, 2023, residential and agricultural solar up to 25 kW became a separate taxable class wholly exempt from state and local taxation statewide (per Chapter 496/SB 686). The program targets non-commercial residential and agricultural participants; a separate commercial exemption exists. Participating jurisdictions (11 cities, 18 counties) must use local building departments or DEQ certification to verify system specifications and value for tax assessment purposes.
Program details
- Program ID
- 85
- Last updated
- 3/23/2026
Eligibility
- Sectors
- residential
- Technologies
- solar - passive solar water heat solar space heat solar thermal electric solar photovoltaics
Program summary
The State of Virginia provides the option for any county, city, or town to exempt or partially exempt solar energy equipment and recycling equipment from local property taxes. This status is targeted toward non-commercial participants; commercial entities have a separate exemption/abatement through the Commercial Property Tax Exemption for Solar.
The solar equipment and installation has to be inspected and certified by the local building department or the Department of Environmental Quality to provide the value of the system for the purpose of determining tax credit. The statute broadly defines solar energy equipment as any that is "designed and used primarily for the purpose of collecting, generating, transferring, or storing thermal or electric energy." This includes solar photovoltaic (PV), solar thermal heating, and passive solar systems.
Recycling equipment is defined as equipment which is "certified by the Department of Environmental Quality as integral to the recycling process and for use primarily for the purpose of abating or preventing pollution of the atmosphere or waters.
Cities currently offering a solar energy equipment and facilities exemption include: Alexandria, Charlottesville, Fredericksburg, Hampton, Harrisonburg, Lexington, Lynchburg, Petersburg, Roanoke, Suffolk, and Winchester.
Counties currently offering a solar energy equipment and facilities exemption include: Albemarle, Augusta, Botetourt, Chesterfield, Dinwiddie, Fairfax, Frederick, Giles, Hanover, Isle of Wight, King George, Loudoun, Prince William, Pulaski, Scott, Spotsylvania, Warren, and Wise.
In 2022, Chapter 496 (SB 686) was added to the Code of Virginia. As of January 1, 2023, residential and agricultural solar installations up to 25 kW will be declared a separate class of taxable property and such facilities shall be wholly exempt from state and local taxation.
Contact & resources
- Additional resources
Please verify current program details with the administering agency before making any financial decisions.
