The complete list of Washington D.C. solar incentives and tax credits for 2023
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The cost of electricity is pretty average for the U.S. in Washington D.C., but the solar incentives are better than most states! D.C. offers generous net metering rules, has a robust market for SRECs, and offers solar grants and loans, as well as a property tax exemption for residential solar.
No wonder D.C. generates a whopping 57.24% of its electricity from solar power!
Community solar is huge in the District of Columbia, but if you’re keen to go solar at home, here’s the current roster of solar incentives in D.C.
|Solar Renewable Energy Certificates (SRECs) in Washington D.C.||D.C. has both a renewables portfolio standard and a solar carve-out, with homeowners in the state able to make as much as $4,000 each year by selling SRECs.|
|Solar grants in Washington D.C.||Low-income D.C. residents may be able to get solar installed for free.|
|State property tax exemptions in Washington D.C.||Solar energy equipment is exempt from property taxes in Washington D.C.|
|Net metering in Washington D.C.||D.C. has generous net metering rules with Pepco providing the main net metering program|
|Utility performance-based-incentives (PBIs)||Pepco offers an energy conservation program offering rewards of up to $60 annually or $120 in the first year.|
Grants for solar in Washington D.C.
The DC Sustainable Energy Utility (DCSEU) offers a Solar for All program where local solar contractors design and install solar photovoltaic (PV) systems at no cost to income-qualified homeowners. These systems can offset electricity costs by up to $500 per year. Low- to moderate-income households at or below 80% of the area median income (AMI) threshold can apply for the program, which aims to provide access to solar power to 100,000 families before 2032.
The Solar for All program also funds community solar projects to increase access to solar for condo owners, renters, and others who can’t install rooftop solar themselves.
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SRECs in Washington D.C.
The District of Columbia expanded its renewable portfolio standard (RPS) in 2016 and 2018 and now calls for a reduction in greenhouse gas emissions of 50% below 2006 levels by 2032 and 100% by 2050. The RPS includes a solar carve-out of 10% by 2041, courtesy of the Clean Energy DC (CEDC) Omnibus Act of 2018.
These laws in D.C. mandate utilities produce or purchase a certain amount of renewable energy, thus creating a market for solar renewable energy certificates (SRECs). Accordingly, homeowners and businesses with solar energy systems can sell their SRECs to utilities to generate income. In 2021, SRECs in D.C. sold for between $365 and $435 each. For the average 8 kW rooftop array this could amount to annual income of $2,920 to $4,000.
State property tax exemptions in Washington D.C.
D.C. offers a property tax exemption for value added through the installation of solar water heat, solar space heat, solar thermal electric, solar thermal process heat, solar photovoltaics, and combined heat & power.
Net metering in Washington D.C.
D.C. has its own net metering laws which not only mandate that utilities offer net metering but also stipulate how the credits work. Residential customers who install solar and apply for net metering can earn credits for energy their system exports to the grid. At the end of the month, any net surplus energy is converted to credits at full retail rate (for systems under 100 kW) and can be applied to subsequent bills to offset future energy use. The credits never expire.
Pepco is the main utility providing net metering in D.C. The utility will install a special meter to track energy flowing in and out of the grid. The rules in D.C. don’t limit households to only produce the energy they typically use in a year. That means you can install a larger array than you need, enjoy net metering benefits now, and be ready for any future increases in consumption if you plan on installing an EV charger or growing your family.
The only caveat to these excellent net metering rules is that Pepco may not have an open circuit where you live. If there’s no open circuit, net metering won’t be available as it can be unsafe for the integrity of the grid, your power system, and workers.
Utility PBIs in D.C.
In addition to offering net metering, Pepco offers its Energy Wise Rewards program to customers in DC. It’s free to enroll and there are no program fees. The basic idea is that Pepco installs an indoor Energy Wise Rewards thermostat or outdoor switch at your home. This allows Pepco to ‘cycle’ homeowners’ central air conditioning units, putting units in energy conservation mode at different times, so as to reduce demand and strain on the grid during peak energy use periods.
The rewards program grants participants credits for allowing cycling on Peak Savings Days from June through October. There are typically five or fewer such days each year and the more people sign up, the shorter the duration of each conservation cycle.
You can also choose the level of cycling you want. For instance, a 50% level allows the indoor temperature to rise up to 1-3 degrees during a conservation period; 75% means a potential rise of 2-4 degrees; and 100% allows for rises of 4-7 degrees. If you’re not home or have a well-insulated home with good shade and ceiling fans, you may not even notice the impact of cycling.
Higher levels of cycling earn more rewards. For 100% participation, households can earn $120 in the first year of enrolment and then $60 each year thereafter. At the lower levels, households can earn $30 and $45 respectively for installing the thermostat and then $30 and $45 each year for participating in the program.
Final thoughts on state solar incentives in Washington D.C.
Washington D.C. is making waves when it comes to solar. The district has more installed solar capacity than several states and has done a lot to incentivize residents, businesses, and utilities to go solar in recent years.
As an example, Atlas Brew Works installed one of D.C.’s largest corporate solar photovoltaic systems in 2015, providing 67.5 kW of solar capacity to power the brewery and its operations. (Check out other sustainable brewers here.)
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It’s never been easier to install solar at home in D.C. The district offers grants for low-income households to install solar for free, low-cost loans for most residents, and has laws that help homeowners earn additional income from selling SRECs. Generous net metering rules help offset monthly utility bills, and property tax exemptions avoid additional expenses from going solar.
All in all, D.C. residents can expect a short, sweet solar payback period and many years of free electricity by installing a rooftop array.