Key Takeaways
- Vermont’s Public Utility Commission reviews net-metering compensation rates every two years, so rate changes are a recurring event, not a one-time thing.
- Existing solar customers are not affected by new rate decisions – their compensation is locked in by the terms of their existing net-metering agreement.
- Solar still works after a rate change because Vermont utility electricity has trended upward over time, and you offset that with your own production for the life of the system.
- Homeowners who sign project agreements before a scheduled change keep the rate in effect at signing, which is why timing around the PUC review cycle matters.
One effective strategy for homeowners and business owners to maximize the benefits of their solar investments is through net-metering, which is when utilities provide credits for surplus solar energy fed into the grid. Every two years, Vermont’s Public Utility Council (PUC) reviews the current compensation rates for solar energy and determines whether adjustments are necessary. They recently announced the compensation rate will decrease by $0.02 per kWh starting August 1st.
This decision came on June 1st, and gives the utility until Jun 15th to update their tariffs, which will then take effect on August 1st.
Vermonters who already have solar panels and net-metering agreements with their utility will not be affected by the upcoming rate decrease. In fact, along with these changes comes the announcement of a new blended residential rate for solar net metering, which will increase the base net-metering rate to $0.1839 per kWh, up from $0.1765. This will also take effect on August 1st, 2024. The value of your solar does increase with rising utility rates, and we are seeing that in effect at the state level with this update.
For those considering transitioning to solar, there is still an opportunity to secure the current rate by submitting the necessary permits before August 1st. Those who sign before August 1st, will earn $0.1639 on their solar going forwards. After the August 1st deadline, any new solar customers will earn $0.1439 (two cents less).
This effectively means that customers who submit permits after August 1st will receive 12% less credit for their solar energy production, due to the additional $0.02 reduction per kWh. If you are considering solar, it’s essential to act soon to secure the existing net-metering rates and maximize the benefits of your solar system!
Why Solar Still Makes Sense at the New Rate
A change in compensation rates does not mean solar stops making sense in Vermont. Utility electricity has trended upward over time, which cuts in the opposite direction of the net-metering change.
When utility rates move, the electricity you generate on your own roof becomes more valuable by comparison. That’s the core reason solar protects against utility rate hikes even when net-metering compensation shifts.
It’s also worth understanding how a fixed solar loan compares to a utility bill when planning your project, since loan terms are set at signing and utility rates are not.
Between the net-metering credit you continue to earn for the term of your agreement and the rate protection that comes with generating your own power, solar still works at the new rate. For more on planning a project in Vermont, see our guide on Vermont solar and battery projects.
What Existing Solar Customers Should Know
If you already have a net-metering agreement, the rate change doesn’t affect you. Your compensation rate is tied to the terms in place when your project was approved, and those terms typically run for 10 years from the permit date in most Vermont cases.
The one thing existing customers should watch is what happens when their original agreement expires. At that point, your account transitions to whatever the current blended rate is, not the rate you originally signed up for. If your agreement is getting close to year 10, that’s worth planning around.
Timing Around the Next PUC Review
The Public Utility Commission reviews net-metering compensation every two years, so another rate check is always on the horizon. The direction has consistently been downward as Vermont’s solar capacity grows.
If you’re on the fence about going solar, the practical takeaway is to track the review cycle. Signing a project agreement before a scheduled rate change is the cleanest way to lock in the current compensation level for the full term of your agreement.
Our team can walk you through where the current PUC calendar sits and what it means for your project timing.
Green Mountain Solar will be able to process the permit applications for customers who sign project agreements with us by the end of July so they can be locked in to the current net-metering rate. Get in touch with us to set up a free site visit and get started on your solar journey, while ensuring you get the most out of your investment.
Frequently Asked Questions
How often does Vermont change net-metering rates?
Vermont’s Public Utility Commission reviews net-metering compensation rates every two years. Changes can go up or down, but recent trends have pushed the credit rate for new solar customers lower as statewide solar capacity has grown.
Does a lower net-metering rate mean solar isn’t worth it?
No. Utility electricity has generally trended upward in Vermont, so the relative value of generating your own power tends to grow over time. The net-metering credit you lock in at the time of install also stays with your agreement for its full term.
How do I lock in the current net-metering rate?
You need a signed project agreement and submitted permits before the scheduled rate change date. Our team handles the permit paperwork, so the window is driven by how quickly we can get your agreement signed and site visit completed.
Will my existing solar agreement change?
No. Your existing compensation rate is locked in for the term of your net-metering agreement, which is typically 10 years from the permit date. When the agreement expires, your account transitions to the current blended rate in effect at that time.
Get Ahead of the Next Rate Change
Want to know where the next PUC review sits and what it means for your project timing? Our team can walk your site and talk you through it.
Or call us at (802) 369-9149
