Solar in District of Columbia

DC's residential solar policy is built on full retail net metering, established under Public Service Commission rules for systems up to 1 MW with an annual true-up — one of the most generous system-size caps in the country. Pepco, the sole investor-owned electric utility, implements the structure District-wide. Customers retain their net-metering terms for the life of their interconnection.

The DC SREC market is the policy centerpiece. The District's Renewable Portfolio Standard carries an aggressive solar carve-out that, combined with limited local generation, keeps SREC prices among the highest in the nation — recently near $380/SREC. A residential system earns one SREC per megawatt-hour produced and sells the credits through PJM-GATS brokers or aggregators. This is genuine additional income layered on top of the net-metering offset, and it is the single biggest policy driver of DC solar economics.

DC also offers a DCSEU upfront rebate (~$0.50/W), a state-level renewable energy tax credit, a 20-year property tax exemption, and a sales tax exemption. The federal Section 25D residential credit expired December 31, 2025; leased and PPA systems may still access Section 48E for projects that began construction before July 6, 2026. The District's community renewable energy facility program broadens access for renters and shaded properties.

DC's 4.6 peak sun hours are solid for a Mid-Atlantic jurisdiction at this latitude, with productive summers and a real but manageable winter dip. The District's small geographic footprint means there is little regional variation in the raw resource — the production equation is governed almost entirely by rooftop conditions rather than location within the city. Long summer days drive peak output that aligns reasonably well with air-conditioning load.

Because DC mandates full retail net metering with an annual true-up, the classic maximize-and-bank model holds: size to cover annual consumption with a south-facing array tilted near latitude, and bank the summer surplus against winter consumption. The exceptionally valuable SREC stream reinforces a maximize-output approach, since every kilowatt-hour produced — consumed or exported — generates credit income at roughly $380/SREC. There is no avoided-cost penalty for overproduction.

The real constraint in DC is usable roof area. Rowhouse footprints, fire-code setbacks, and shading from neighboring buildings and tree canopy push many systems smaller and toward higher-efficiency panels. For properties that cannot host a viable array, the DC community renewable energy facility program offers a shared-solar alternative that still captures the SREC value.

DC's $3.50/W installed cost is above the national average, with a typical 8 kW system around $28,000 before incentives — reflecting dense urban labor markets, permitting overhead, and the complexity of rowhouse installations. But the incentive stack is exceptionally deep: the DCSEU upfront rebate (~$3,500), the DC renewable energy tax credit (~$1,225), the property tax exemption (20 years), the sales tax exemption, and the high-value SREC market together reduce effective cost substantially.

The SREC income is the standout. At roughly $2,660 a year for an 8 kW system — paid on production regardless of whether energy is consumed or exported — it functions as a durable second revenue stream that materially shortens payback. Even so, payback near 15 years on the 8 kW model reflects DC's only middling retail rate (~$0.18/kWh), which limits the value of each offset kilowatt-hour compared to high-rate neighbors like Maryland or Connecticut.

The DCSEU rebate and SREC aggregator terms are the two variables most worth confirming at installation. Both programs have capacity allocations and pricing that shift over time, and the SREC contract structure (upfront lump versus ongoing) materially affects the cashflow profile of a project.