Trevor has worked in home improvement and residential solar since 2016 and maintains the EcoGen Solar Cost Index.
While most states spent 2026 cutting what they pay for rooftop solar, Vermont went the other way. On May 29, 2026 the Public Utility Commission issued its order in the biennial update, case 26-0291-INV, and net-metering compensation went up rather than down. Combine that with electricity about 31% above the US average at 23.52¢ per kilowatt-hour and the smallest systems, and Vermont produces among the shortest paybacks in the country: under ten years.
The Rate Went Up, Which Almost Nowhere Else Did
Vermont does not use one-to-one net metering. Under statewide Commission Rule 5.100 your generation is credited at a blended residential rate, adjusted up or down by two modifiers: a renewable energy certificate adjustor and a siting adjustor that rewards putting panels somewhere uncontroversial. A rooftop array up to 15 kW is Category I, which carries the most favorable siting treatment available.
Vermont is one market of fifty; the full national pricing picture shows where it lands.
Under the previous NM 2.6 terms the statewide blended rate was 18.4¢ with a 4¢ Category I adjustor, which put excess at about 14.4¢. The May 2026 order raised compensation from there. The order sets the statewide blended rate at 20.71¢ effective August 1, 2026 and the Category I adjustor at negative 5¢ for complete applications filed on or after that date, which puts a new rooftop system at about 15.7¢ for excess, a gain of about 1.3¢ over the prior terms; confirm your exact Category I figure with your utility before you model anything. What is verified is the direction and the date: compensation rose, on May 29, 2026, under Rule 5.128.
That order followed roughly 900 public comments, nearly all of them opposing the Department of Public Service’s push to restrain the program. It is a useful signal about where Vermont’s politics sit on this, though it is not a guarantee about the next biennial update.
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Small Roofs, Expensive Power, Short Payback
Vermont households use less electricity than most of the country, 574 kWh a month, but pay the most for it. That combination is unusually good for solar: you need very little hardware to make a real dent in an expensive bill. At $2.89 per watt (as of March 1, 2026) the typical system is just 5.43 kW at about $15,687 gross, among the smallest and cheapest anywhere.
Small-roof sizes at the benchmark, gross before incentives:
| System size | Gross at Vermont’s $2.89/W benchmark |
|---|---|
| 4 kW | $11,560 |
| 5 kW | $14,450 |
| 5.43 kW, the typical Vermont system | $15,687 |
| 8 kW | $23,120 |
| 10 kW | $28,900 |
| What works against you | What works for you |
|---|---|
| Among the weakest sunlight in the country, 1,269 kWh per kW a year | About 31% above the US average, 23.52¢/kWh |
| Compensation is a blended rate, not full retail | Rate escalation of 4.34% a year over five years |
| Off-site group net metering closed to new projects on December 31, 2025 | Smallest system needed, so the lowest gross cost to recover |
Net it out and a system producing roughly 6,891 kWh a year displaces about $1,621 of electricity, a 9.7-year payback, modeled at the 23.52¢ statewide average. That is among the shortest modeled paybacks in the country, and it is driven by the price of power rather than by the amount of sun. The federal residential credit is $0 for owner-purchased systems whose installation is completed after December 31, 2025 under Public Law 119-21, and Vermont still clears ten years without it.
Treat that figure as a ceiling rather than a promise: it values every unit at the statewide average, while Vermont actually compensates net-metered output at a blended rate with adjustors, which this page describes below. A quote that conflates the two overstates your return, so ask your utility for your exact Category I compensation before relying on any payback number, including this one.
Locked at Enrollment, Which Cuts Both Ways
Vermont’s adjustors are fixed at enrollment, so the terms you sign up under travel with your system rather than floating. If you enroll while compensation is high, you keep that. If you enroll just before an increase, you keep the lower figure. Since the biennial update runs on a two-year cycle and the most recent one moved upward, the timing question here is genuinely live rather than rhetorical, and it is worth asking your installer which rate your application will land under.
Who Should Still Hesitate in Vermont
- Anyone told they will receive full retail credit. Vermont credits a blended rate with adjustors, not the 23.52¢ you pay. A quote that conflates the two overstates your return substantially.
- Anyone planning an off-site or group project. Off-site group net metering closed to new projects on December 31, 2025.
- Heavily shaded or north-facing roofs. With some of the weakest sunlight in the country, Vermont has little margin for a compromised array.
- Vermont Electric Cooperative and Burlington Electric customers modeling on Green Mountain Power figures. Rates differ by utility, and Burlington’s are materially lower.
Vermont Solar Cost FAQs
How much do solar panels cost in Vermont in 2026?
About $2.89 per watt installed, 26th cheapest in the country as of March 1, 2026. Vermont households use less power than most of the country at 574 kWh a month, so the typical system is small at 5.43 kW, roughly $15,687 before incentives.
Did Vermont change its net metering rates in 2026?
Yes, and upward. The Public Utility Commission issued its biennial update order in case 26-0291-INV on May 29, 2026, adjusting compensation under Rule 5.128, and net-metering compensation increased rather than decreased. Confirm your exact Category I figure with your utility, because rates differ between Green Mountain Power, Vermont Electric Cooperative and Burlington Electric.
How does Vermont net metering actually pay you?
Through a blended residential rate adjusted by a renewable energy certificate adjustor and a siting adjustor, under statewide Commission Rule 5.100, rather than at full retail. A rooftop system up to 15 kW is Category I and receives the most favorable siting treatment. Adjustors are locked at enrollment, so your terms travel with the system.
What is the solar payback period in Vermont?
About 9.7 years, modeled at the statewide average and among the shortest in the country. That is driven by the price of power rather than the amount of sun: Vermont has the weakest sunlight in the group at 1,269 kWh per kW but the most expensive electricity at 23.52¢, and rates are rising 4.34% a year.
Can I still join a community solar project in Vermont?
Not a new off-site group net metering project. That route closed to new projects on December 31, 2025. Existing arrangements continue, and rooftop Category I systems remain the standard path for a household that wants its own generation.
Expensive power and a small roof make this one work. Enter your ZIP code and we will confirm your rate and your numbers.
See what a small Vermont system returns
Methodology: cost figures use the EcoGen Solar Cost Index for Vermont, $2.89 per watt as of March 1, 2026, with payback modeled with no federal residential credit for owner-purchased systems, the year-one value modeled at the statewide average retail price as a ceiling, with actual compensation set by the blended rate and Category I adjustor described above, rate escalation at the state 5-year average of 4.34%, 0.5% annual panel degradation, and a 25-year horizon. The May 29, 2026 order date, the 20.71¢ blended rate effective August 1, 2026 and the negative 5¢ Category I adjustor for complete applications filed on or after that date are taken from the Commission’s order in Case 26-0291-INV.
References & Research Sources
EcoGen America reviewed Vermont Public Utility Commission biennial update orders and program rules, federal electricity price and utility datasets, Census home-value data, and federal tax guidance for this Vermont solar cost guide. Sources were accessed between June 10 and August 17, 2026, unless another date is listed below.
- Vermont Public Utility Commission (PUC). 2026 Biennial Update of the Net Metering Program. Notice of the May 29, 2026 order in Case 26-0291-INV adjusting compensation under Rule 5.128. Accessed June 11, 2026.
- Vermont Public Utility Commission (PUC). Order in Case 24-0248-INV: 2024 Biennial Update. The NM 2.6 blended rate and Category I adjustor, with Rule 5.100 governing program structure and the December 31, 2025 closure of off-site group net metering. Accessed June 11, 2026.
- U.S. Energy Information Administration (EIA). Electric Power Monthly, Table 5.6.A. Average residential electricity prices by state, March 2026 edition. Accessed June 10, 2026.
- U.S. Energy Information Administration (EIA). Form EIA-861: Annual Electric Power Industry Report, 2024. Residential customer counts for Green Mountain Power, Vermont Electric Cooperative, and Burlington Electric. Accessed June 10, 2026.
- U.S. Census Bureau. American Community Survey, 2024. Median home value data used for cost-to-value context. Accessed June 11, 2026.
- Internal Revenue Service (IRS). One, Big, Beautiful Bill Provisions. Guidance on Public Law 119-21, including termination of the Section 25D residential credit for systems whose installation is completed after December 31, 2025. Accessed August 15, 2026.
