Local Option - Property Tax Exemption

May 25, 2023


Vermont allows municipalities the option of offering an exemption from the municipal real and personal property taxes for certain renewable energy systems (Note: state property taxes would still apply). Eligible systems include but are not limited to "windmills, facilities for the collection of solar energy or the conversion of organic matter to methane, net-metered systems ... and all component parts thereof, but excluding land upon with the facility is located." Adoption of this exemption varies by municipality, but the exemption generally applies to the total value of the qualifying renewable energy system and can be applied to residential, commercial, and industrial real and personal property.

Note: Solar photovoltaic systems under 50 kW that are net-metered or are not connected to the grid and only provide power to the properties on which they are located are already currently exempt from municipal property taxes under 32 V.S.A. § 3802(17) (see Uniform Capacity Tax and Exemption for Solar).

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: Vermont
Incentive Type: Property Tax Incentive
Web Site: http://tax.vermont.gov/municipal-officials/solar-valuation/everything-you-need-to-know-about-solar
Start Date:
Eligible Renewable/Other Technologies:
  • Solar Water Heat
  • Solar Space Heat
  • Solar Thermal Electric
  • Solar Photovoltaics
  • Wind (All)
  • Biomass
  • Hydroelectric
  • Combined Heat & Power
  • Landfill Gas
  • Wind (Small)
  • Hydroelectric (Small)
  • Anaerobic Digestion
  • Fuel Cells using Renewable Fuels
  • Lithium-ion


Name: 32 V.S.A. § 3845
Date Enacted: 1975 (subsequently amended)


Name: Vermont Department of Taxes
Address: 133 State Street
Montpelier VT 05633
Phone: (802) 828-2505
Email: tax.vttaxdept@vermont.gov

This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.