Incentives for Virginians

This page lists grants, rebates, tax credits, tax deductions, and utility incentives available to encourage the adoption of energy efficiency measures and renewable/ alternative energy. The incentives may vary by sector, but in general there are programs for all types: residential customers, small and large businesses, and government agencies.

This list is organized by the category of incentive (energy efficiency, renewable energy, alternative fuels and vehicles, and research and development) and then by the organization offering the incentive: the Commonwealth of Virginia (grants, rebates, tax credits); the federal government (mostly tax credits and tax deductions); and the gas and electric utilities (demand response, load management, etc.). To get started, click on one of the categories below and look for incentive programs that apply to your sector: residential, commercial, industrial, or government. 

For a searchable listing of incentives, use the Database of State Incentives for Renewables and Efficiency, DSIRE.

Energy Efficiency Incentives | Renewable Energy Incentives | Alternative Fuels, Vehicles and Transit | Research and Development


Additional Resources

DSIRE, the Database of State Incentives for Renewables and Efficiency is a comprehensive source of information on incentives and policies that support renewables and energy efficiency in the US.  


Compact fluorescent bulbEnergy Efficiency and Energy Conservation

Virginia Incentives for Energy Efficiency and Energy Conservation

VirginiaSAVES Green Community Program

Potential Applicants: Local government, Non-profit organizations, Businesses, and Industry The VirginiaSAVES Green Community Program is a unique public/private partnership sponsored by Virginia's Department of Mines, Minerals, and Energy (DMME) to provide subsidized financing for energy efficiency, renewable energy, and alternative fuel loans.  DMME has initially capitalized the Program with $20 million of Qualified Energy Conservation Bonds (“QECBs”), with the ability to provide more QECB allocations as needed from additional QECBs available within the Commonwealth.  The benefit of using the QECBs to fund the Program is that they offer a direct pay credit subsidy from the U.S. Treasury to offset the interest rate on the financing, with this Credit Payment historically being between 2-3% and fixed over the life of the financing of up to 20 years or longer.  The following are the examples of the types of energy conservation measures that can be financed through the Program:

  • Energy-efficient fixtures and retrofits for buildings and industrial processes, which would include mechanical systems and components including HVAC, controls, steam and hot water upgrades, electrical systems and components including lighting and lighting controls, doors and windows, insulation, refrigeration upgrades and cogeneration (combined heat and power), as well as water conserving fixtures with demonstrable energy savings. 
  • Renewable energy systems such as solar, biomass, geothermal, micro-hydroelectric, methane capture, combined heat and power co-generation technologies and/or fuel cell technologies.
  • Deployment of alternative fueling infrastructure and vehicles or stationary power sources,  with examples being the fueling infrastructure and OEM vehicles and/or retrofit kits associated with converting existing diesel and/or gasoline fleets over to CNG or LNG or propane or biodiesel fuel.

Eligible Measures should demonstrate a reasonable basis to achieve a projected 10 year or better simple pay back based on project cost and projected energy cost savings or revenue. Exceptions to the 10 year payback requirement for any of the Eligible Measures set forth above may be considered on a case by case basis.  For more information, visit the VirginiaSAVES website.


Energy Efficient Buildings Tax Exemption (Code of VA §58.1-3221.2)
 

Potential Applicants: Business, Industry, and Residents 

This statute allows any county, city, or town to exempt or partially exempt energy efficient buildings from local property taxes. Eligible buildings are those that:

  • Exceed the energy efficiency standards prescribed in the Virginia Uniform Statewide Building Code by 30 percent;
  • Meets or exceeds performance standards of the Green Globes Green Building Rating System of the Green Building Initiative;
  • Meets or exceeds performance standards of the Leadership in Energy and Environmental Design (LEED) Green Building Rating System of the U.S. Green Building Council;
  • Meets or exceeds performance standards or guidelines under the EarthCraft House Program; or
  • Is an Energy Star qualified home.

Localities offering exemptions: CharlottesvilleRoanoke


Weatherization Assistance Program

Potential Applicants: Low-income homeowners and renters
 

The Weatherization Assistance Program provides funds to reduce the heating and cooling costs for low-income families and to ensure their health and safety.  The program provides repairs and improvements to home heating and cooling systems as well as providing for the installation of energy-saving measures in the house.

For more information about this program, visit the Department of Housing and Community Development website or email Lee Hutchinson.


ENERGY STAR and WaterSense Sales Tax Holiday

The sales tax holiday will be a recurring event.  The 3-day sales tax holiday begins the first Friday in August and ends the following Sunday each year.

During this period, consumers may purchase certain Energy Star qualified products exempt of the Retail Sales and Use Tax. The exempt items include: any dishwasher, clothes washer, air conditioner, ceiling fan, compact fluorescent light bulb, dehumidifier, programmable thermostat, or refrigerator, the energy efficiency of which has been designated by the United States Environmental Protection Agency and the United States Department of Energy as meeting or exceeding each such agency’s requirements under the Energy Star program. In order to be eligible for the Energy Star or WaterSense sales tax holiday exemptions, products must cost $2,500 or less per item, affixed with an Energy Star or WaterSense label and be purchased for noncommercial home or personal use.

For information regarding this program, visit the Virginia Department of Taxation.


Federal Incentives for Energy Efficiency and Energy Conservation 

Personal Tax Credit for Home Improvements

Potential Applicants: Homeowners who placed in service qualified energy saving home improvements between January 1, 2011, and December 31, 2017.

Home improvement tax credits are available for insulation, replacement windows, water heaters, high efficiency heating and cooling equipment, and biomass stoves. The maximum total amount that can be claimed for all products placed in service in 2011 for most home improvements is 10% of cost up to $500 EXCEPT for geothermal heat pumps, solar water heaters, solar panels, fuel cells, and small wind energy systems that are not subject to this cap, and are in effect through 2017. 

If you are building a new home, you can qualify for the tax credit for geothermal heat pumps, photovoltaics, solar water heaters, small wind energy systems and fuel cells, but not the tax credits for windows, doors, insulation, roofs, HVAC, or non-solar water heaters.   Geothermal heat pumps, small wind turbines, and solar energy system may be eligible for a tax credit of 30% of the cost until December 31, 2019.  Fuel cells may be eligible of a tax credit of 30% of the cost, up to $500 per 0.5 kW of power capacity until December 31, 2019. 


Utilities/Private Incentives for Energy Efficiency and Energy Conservation

Load Management Programs (for electric water heaters and HVAC)

Potential Applicants: Customers of Franklin Municipal Power & Light, Northern Neck Electric Cooperative, or Northern Virginia Electric Cooperative

These programs aim to reduce the energy used during peak demand periods by installing a switch on water heaters and/or air conditioning systems to turn them off during peak times. Residential and non-residential customers who participate receive incentives such as free hot water heater and HVAC repairs or evaluations, monthly credits on electric bills, and/or rebates towards the purchase of a efficient hot water heater. Incentives vary by utility.

For more information, click on the link for your utility below:

Franklin Municipal Power & Light's 'Cycle and Save Program'

Northern Neck EC's Load Management Program 

Programmable Thermostat Rebate

Potential Applicants: Customers of Charlottesville Gas

Homeowners or property owners who heat with gas are eligible for a $200 tankless water heater rebate and up to $100 toward the purchase and/or installation of the programmable thermostat. For more information visit Charlottesville Gas.


Dominion Virginia Power Energy Conservation Residential Program   

 


Dominion Virginia Power Energy Conservation Non-Residential Programs  


Warm Wise Business Savings Program 

Columbia Gas of Virginia - WarmWise Home Savings Program
Potential Applicants: Residential customers of Columbia Gas of Virginia Cash back rebates are available for qualifying energy-saving upgrades such as furnaces, windows and insulation.  Also, a free online Home Savings Evaluation along with up to two free Energy Efficiency Kits are available. Cash rebates for energy saving upgrades are given for the following:  

  • High efficiency gas furnace, 90% AFUE or higher
  • Attic insulation, existing insulation R-0 to R-19, final insulation level greater than or equal to R-38
  • Floor Insulation, minimum R-19 added
  • High-Efficiency Windows, Doors, Skylights, Consistent with ENERGY STAR specifications for the North-Central climate zone  

Columbia Gas of Virginia - WarmWise Business Savings Program
 Potential Applicants: Commercial customers of Columbia Gas of Virginia Cash rebates for energy saving upgrades are given for the following:  

  • Replacement of pre-rinse spray valves with qualifying low-flow (1.6 gallons or less) pre-rinse spray valves
  • High efficiency gas furnace, 90% AFUE or higher
  • Attic insulation, existing insulation R-0 to R-19, final insulation level greater than or equal to R-38
  • Smart thermostat, pre approved list can be found at www.WarmWiseVA.com
  • Boiler Controls

 
Green Mortgages

Potential Recipients: Small businesses, homeowners refinancing, and soon-to-be homeowners
If your small business is looking for loans to retrofit facilities, purchase energy efficient equipment, utilize energy efficient construction, buy alternative fuel for vehicles, or to implement other efficient ideas, there maybe be help from the U.S. Small Business Administration (SBA). Although the SBA does not make loans, it does guarantee them. SBA loan programs 7(a) and CDC/504 could offer some assistance. For information on SBA loan programs visit the SBA's webpage on loan programs.

Additional Resources

The Database for State Incentives for Renewables & Efficiency (DSIRE) tracks federal, Virginia, local, and utility incentives.

The Tax Incentives Assistance Project is designed to give consumers and businesses information they need to make use of the federal income tax incentives for energy efficient products and renewable energy technologies.

 


 

Renewable Energy    Renewable Energy

Virginia Incentives for Renewable Energy

 

VirginiaSAVES Green Community Program

Potential Applicants: Local government, Non-profit organizations, Businesses, and Industry

The VirginiaSAVES Green Community Program is a unique public/private partnership sponsored by Virginia's Department of Mines, Minerals, and Energy (DMME) to provide subsidized financing for energy efficiency, renewable energy, and alternative fuel loans.   


Solar Energy Equipment Tax Exemption (Code of VA § 58.1-3661)

Potential Applicants: Business, Industry, and Residents

This statute allows any county, city, or town to exempt or partially exempt solar energy equipment from local property taxes. Eligible technologies include passive solar space heat, active solar water heat, active solar space heat, solar thermal electricity, and photovoltaics. Certified solar energy items are defined as any 'property, including real and personal property, equipment, facilities, and devices which use solar energy that would otherwise require a conventional source of energy.'

Localities offering exemptions: Albemarle, Alexandria, Charlottesville, Chesterfield, Dinwiddie, Fairfax County, Falls Church, Hampton, Hanover, Henrico, Isle of Wight, King and Queen, Loudoun, Lynchburg, Prince William, Pulaski, Roanoke, Spotsylvania, and Winchester

For more information contact Ken Jurman at 804-692-3222.


Wood, Alternative Energy, or Cogeneration Tax Exemption (Code of VA § 58.1-3662)

Potential Applicants: Business and Industry

This statute allows any county, city, or town to exempt or partially exempt generating equipment that is used to convert from oil or natural gas to wood, wood waste, or any alternative energy source for manufacturing, or any cogeneration equipment, from local property taxes.

Localities offering exemptions: Dinwiddie, Henrico, Pulaski, and Winchester  


Certified Pollution Control Equipment and Facilities Tax Exemption (Code of VA § 58.1-3660)

Potential Applicants: Business and Industry

This statute allows any county, city, or town to exempt or partially exempt certified pollution control equipment and facilities, including equipment used to grind, chip, or mulch trees, tree stumps, underbrush, and other vegetative cover for reuse as a fuel, from local property taxes.

Localities offering exemptions: Alleghany, Amherst, City of Bedford, Bedford County, Campbell, Chesterfield, Cumberland, Danville, Dinwiddie, Franklin, Frederick, Front Royal, Giles, Grayson, Henrico, Hopewell, Isle of Wight, King William, Lynchburg, Manassas, Montgomery, Newport News, Norfolk, Orange, Petersburg, Prince William, Pulaski, Radford, City of Richmond, Roanoke, Saint Paul, Salem, Shenandoah, Spotsylvania, Tazewell, Warren, Waynesboro, West Point, Winchester, Wytheville, and York.


Wind Power: The State-Based Anemometer Loan Program

Potential Applicants: Virginia landowners

The State-Based Anemometer Loan Program provides Virginia landowners an opportunity to quantify their wind resources with the objective to spur the development and use of wind energy throughout the state. Under the program grant, JMU received ten 20-meter anemometer towers with instrumentation. Each tower takes one year of measurement on-site and then is relocated to a new site over the span of three years. This is meant to obtain data from thirty locations throughout the state. JMU also owns a 50-meter tower and will soon own a 40-meter tower as additions to the program. The data obtained from the towers is reported to the borrowers and is used by Virginia and NREL to validate wind resource models.  JMU is responsible for receiving applications of interested participants in the program, selecting which sites are most appropriate for the wind energy study, distributing and installing the anemometers, and gathering and processing the data.

 Anemometer Loan Program application.

For more information contact VAcenter4windenergy@jmu.edu  540-568-8770. 


Federal Incentives for Renewable Energy (from the DSIRE website) 

Department of Treasury Renewable/ On-site Power Grants

Potential Applicants: Commercial, Industrial, and Utilities

The grants are available for eligible property placed in service in 2009 and 2010.  See the U.S. Department of Treasury website for guidance.

Business Energy Investment Tax Credit for Solar Water Heat, Solar Space Heat, Solar Thermal Electric, Solar Thermal Process Heat, and Photovoltaics

Potential Applicants: Commercial, Industrial, and Utilities

The credit is equal to 30% of expenditures, with no maximum credit limit stated. Eligible solar energy property includes equipment that uses solar energy to generate electricity, to heat or cool (or provide hot water for use in) a structure, or to provide solar process heat. (Passive solar systems and solar pool-heating systems are not eligible.) Hybrid solar lighting systems are those that use solar energy to illuminate the inside of a structure using fiber-optic distributed sunlight.  

Read the Solar Energy Industries Association's Investment Tax Credit information.


Business Energy Investment Tax Credit for Fuel Cells

Potential Applicants: Commercial, Industrial, and Utilities

The Fuel Cell Tax Credit is equal to 30% of expenditures, with no maximum credit limit stated. The credit for fuel cells is capped at $1,500 per 0.5 kilowatt (kW) of capacity (the credit for fuel cells placed into service on or before October 3, 2008, was capped at $500 per 0.5 kW). Eligible property includes fuel cells with a minimum capacity of 0.5 kW that have an electricity-only generation efficiency of 30% or higher.


Business Energy Investment Tax Credit for Small Wind Turbines

Potential Applicants: Commercial, Industrial, and Utilities

Corporate Small Wind Tax Credit on federal income tax equal to 30% of expenditures, with no maximum for systems placed in service after December 31, 2008 (from October 3, 2008 to December 31, 2008 the maximum credit was $4,000). Eligible small wind property includes wind turbines up to 100 kW in capacity.


Business Energy Investment Tax Credit for Geothermal Systems

Potential Applicants: Commercial, Industrial, and Utilities

The Geothermal System Tax Credit is equal to 10% of expenditures, with no maximum credit limit stated. Eligible geothermal energy property includes geothermal heat pumps and equipment used to produce, distribute or use energy derived from a geothermal deposit. For electricity produced by geothermal power, equipment qualifies only up to, but not including, the electric transmission stage. For geothermal heat pumps, this credit applies to eligible property placed into service after October 3, 2008.


Business Energy Investment Tax Credit for Microturbines

Potential Applicants: Commercial, Industrial, and Utilities

The Microturbine Tax Credit is equal to 10% of expenditures, with no maximum credit limit stated (explicitly). The credit for microturbines is capped at $200 per kW of capacity. Eligible property includes microturbines up to two megawatts (MW) in capacity that have an electricity-only generation efficiency of 26% or higher. 


Business Energy Investment Tax Credit for Combined Heat and Power (CHP)

Potential Applicants: Commercial, Industrial, and Utilities

The Combined Heat and Power Tax Credit is equal to 10% of expenditures, with no maximum limit stated. Eligible CHP property generally includes systems up to 50 MW in capacity that exceed 60% energy efficiency, subject to certain limitations and reductions for large systems. The efficiency requirement does not apply to CHP systems that use biomass for at least 90% of the system's energy source, but the credit may be reduced for less-efficient systems. This credit applies to eligible property placed into service prior to December 31, 2008.


Residential Renewable Energy Tax Credit for Solar Water Heating or Photovoltaic Systems

Potential Applicants: Homeowners who place qualified systems on a residence from January 1, 2006 to December 31, 2016

The Photovoltaic Tax Credit on federal income tax is for 30% of qualified expenditures on photovoltaic systems placed in service after December 31, 2008 with no maximum (maximum of $2000 for systems placed in service between January 1, 2006 and December 31, 2008). Photovoltaic systems must provide electricity for the residence.

The Solar Water Heating Tax Credit on federal income tax is for 30% of qualified expenditures of solar water heating systems placed in service after December 31, 2008 with no maximum (maximum of $2000 for systems placed in service between January 1, 2006 and December 31, 2008). Solar hot water systems must provide at least half of the energy used by the system to heat the water and the equipment must be certified for performance by the Solar Rating Certification Corporation (SRCC). This tax credit is not available for expenses related to swimming pools and hot tubs.


Residential Renewable Energy Tax Credit for Fuel Cells

Potential Applicants: Homeowners who place qualified systems on a residence from January 1, 2006 to December 31, 2016

The Maximum Tax Credit of $500 per half kilowatt (kW). The fuel cell must have a nameplate capacity of at least 0.5 kW of electricity using an electrochemical process and an electricity-only generation efficiency greater than 30%.  The home served by the system must be the taxpayer’s principal residence.


Residential Renewable Energy Tax Credit for Small Wind

Potential Applicants: Homeowners who place qualified systems on a residence from January 1, 2008 to December 31, 2016

Small Wind Personal Tax Credit on federal income tax for 30% of qualified expenditures with no maximum for systems placed in service after December 31, 2008 (the cap on systems placed in service in 2008 was up to $500 per half kilowatt with a maximum of $4,000 total). 


Residential Renewable Energy Tax Credit for Geothermal Heat Pumps

Potential Applicants: Homeowners who place qualified systems on a residence from January 1, 2008 to December 31, 2016

Geothermal Heat Pump Tax Credit on federal income tax for 30% of qualified expenditures on systems placed in service after December 31, 2008 with no maximum (maximum of $2000 for systems placed in service between January 1, 2006 and December 31, 2008). The geothermal heat pump must meet the requirements of the ENERGY STAR program which are in effect that the time the installation is completed. 


USDA Rural Energy for America Program (REAP) - Grants

Potential Applicants: state and local government entities, tribal governments, land-grant colleges and universities, rural electric cooperatives and public power entities

REAP promotes energy efficiency and renewable energy for agricultural producers and rural small businesses through the use of grants and loan guarantees.

Grants and loan guarantees may be used to purchase renewable energy systems (including systems that may be used to produce and sell electricity), and to make energy efficiency improvements. Eligible renewable energy projects include wind, solar, biomass and geothermal; and hydrogen derived from biomass or water using wind, solar or geothermal energy sources. REAP incentives are generally available to state government entities, local governments, tribal governments, land-grant colleges and universities, rural electric cooperatives and public power entities, and other entities, as determined by the USDA.

For more information, contact Laurette Tucker, USDA Rural Development, Culpeper Building, Suite 238, 1606 Santa Rosa Rd., Richmond, VA 23229, (804) 287-1594.


Renewable Electricity Production Tax Credit

Potential Applicants: Commercial and Industrial

The federal Renewable Electricity Production Tax Credit (PTC) is a per-kilowatt-hour tax credit for electricity generated by qualified energy resources and sold by the taxpayer to an unrelated person during the taxable year. The energy resource must be placed in service according to the table below. The tax credit can generally be taken for 10 years after the facility was placed in service, with the following exceptions:

  • Open-loop biomass, geothermal, small irrigation hydro, landfill gas, and municipal solid waste combustion facilities are only eligible for the credit for a five-year period if they were placed into service between October 22, 2004, and August 8, 2005.  
  • Open-loop biomass facilities that use cellulosic waste may receive the credit for five years after they are placed in service, with the beginning date set no earlier than January 1, 2005.
Resource Type In Service Deadline Credit Amount
Wind December 31, 2017 2.3¢/kWh
Closed-loop Biomass December 31, 2017  2.3¢/kWh
Open-loop Biomass December 31, 2017 1.2¢/kWh
Geothermal Energy December 31, 2017 2.3¢/kWh
Landfill Gas December 31, 2017 1.2¢/kWh
Municipal Solid Waste December 31, 2017 1.2¢/kWh
Qualified Hydroelectric December 31, 2017 1.2¢/kWh
Marine and Hydrokinetic (150 kW or larger)* December 31, 2017 1.2¢/kWh

 


Utilities/Private Incentives for Renewable Energy

TVA Green Power Switch Generation Partners®

Potential Applicants: Residential or small commercial power customers served by Powell Valley Electric Cooperative

TVA will purchase 100 percent of the green power output at a rate of 15 cents per kilowatt-hour from a photovoltaic or wind generation source installed by a residential or small commercial power customer served by a participating distributor of TVA power. Residential users may also qualify for an additional $500 incentive to help offset start-up costs. Payment is made in the form of a credit issued by the local power distributor on the monthly power bill for the home or business where the generation system is located. Payments are guaranteed for 10 years from the date of the contract. Energy consumed at the home or business, whether it is generated at the site or delivered over the local power distribution system, is billed at the standard rate. All equipment must be in compliance with national standards and all applicable codes and be certified by a licensed electrician.

For more information or to sign up, visit the Green Power Switch website.  


 Alternative Fuels, Vehicles, and Transit    Alternative Fuels, Vehicles and Transit

Federal Incentives for Alternative Fuels, Vehicles and Transit

Alternative Fuel Data

Federal incentives. laws and regulations, funding opportunities and other federal initiatives elated to alternative fuels and vehicles, advanced technologies or air quality.  Additional incentives may also be available through Clean Cities.


Virginia Incentives for Alternative Fuels, Vehicles, and Transit

VirginiaSAVES Green Community Program

Potential Applicants: Local government, Non-profit organizations, Businesses, and Industry

The VirginiaSAVES Green Community Program is a unique public/private partnership sponsored by Virginia's Department of Mines, Minerals, and Energy (DMME) to provide subsidized financing for energy efficiency, renewable energy, and alternative fuel loans.  


Reduction of personal property taxes and/or waiving license fees for 'clean special fuel' vehicles (Code of Virginia § 58.1-3506)

Localities are authorized to reduce the personal property taxes, waive the license fees, or both for 'motor vehicles which use clean special fuels as defined in § 46.2-749.3: As used in this section, 'clean special fuel' means any product or energy source used to propel a highway vehicle, the use of which, compared to conventional gasoline or reformulated gasoline, results in lower emissions of oxides of nitrogen, volatile organic compounds, carbon monoxide or particulates or any combination thereof. The term includes compressed natural gas, liquefied natural gas, liquefied petroleum gas, hydrogen, hythane (a combination of compressed natural gas and hydrogen), and electricity.'


Utilities/Private Incentives

Incentives for Research and Development

  • Department of Energy funding for industry developing energy saving technology
  • Department of Energy funding small businesses developing energy saving inventions
  • Department of Energy e-Center providing financial incentives and business opportunities
  • Department of Energy State Energy Program
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Virginia Department of
Environmental Quality
P.O. Box 1105
Richmond, VA 23218
(804) 698-4000


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