Rhode Island solar rebates and tax credits calculator

Solar incentive

Federal ITC 26% (tax credit)

State tax credit: No

Net metering (by utility)

Calculate for your homes location

There can be solar tax credits and incentives available at the federal, state and local levels. The calculator above will show you the value of all incentives your home is eligible for.

Summary of Rhode Island solar incentives 2020

There are two huge factors working to boost home solar in Rhode Island: the state's Small-Scale Solar grant program and the Renewable Energy Growth Program. Combined, they mean you'll save thousands up front on a new solar system and can sell the electricity it produces for thousands more. 

Solar is cheaper than ever, so the Rhode Island incentives combined with the Federal 26% tax credit for solar means a solar panel system pays itself back quickly and makes you lots of money over its 25-year warrantied life!

On this page, you can:

  1. Learn what solar incentives are available to Rhode Island homeowners

  2. See what Rhode Island solar incentives you qualify for based on your utility company and city

  3. Find out how much these incentives and/or Rhode Island solar tax credits will reduce your cost to go solar and add batteries

Federal solar investment tax credit

The federal solar investment tax credit will have the biggest impact on the cost you will face to go solar in Rhode Island

This perk is commonly known as the ITC, short for “Investment Tax Credit”. If you install your photovoltaic system in 2020, the federal tax credit is 26% of the cost of your solar panel system. This is 26% off the entire cost of the system including equipment, labor and permitting.

Example: If your solar energy system costs $20,000, your federal solar tax credit would be $20,000 x 26% = $5,200.

The federal tax credit falls to 22% in 2021. Unless new legislation is introduced in Washington D.C., this program will be gone in 2022.

Net energy metering in Rhode Island

With net metering in some states, you get full retail rate credit for the amount of electricity you send back into the grid with your solar panels.

Net Metering requires your utility to monitor how much energy your solar power system produces and how much energy you actually consume, and make sure you get credit for the surplus.

Rhode Island has a strong net metering program that ensures you get credit for your surplus energy production -- up to 125% of your monthly consumption. Surplus is credited to you at the utilities avoided-cost rate, and may be either carried forward to the next bill or purchased by the utility, at their discretion.

After 2016, the legislature doubled the net metering limit to 10 Megawatts of total generation capacity, and also added net metering for 3rd-party-owned systems. 

That’s a pretty solid law overall, but there are definitely some easy tweaks the legislature could implement to make net metering even stronger. For one, municipal and cooperative electric companies are currently exempt from the statewide net metering standards. The law should be expanded to cover all utilities. 

We’d also like to see the option for bill rollovers or cash payments moved from the utility to you, so you can decide how the savings help you most.

Rhode Island solar rebates

While Rhode Island does not have a dedicated state rebate for solar panel installation, some manufacturers like LG offer their own solar rebates. These programs are usually time sensitive. For example, LG offers a $600 solar rebate on their equipment, which your installer can help you redeem over the next year.

 

Solar performance payments

National Grid’s Renewable Energy Growth program in Rhode Island provides an awesome incentive to go solar. You get a performance based incentive (PBI) payment which is reflected both as a credit to your monthly electric bill and as a cash payment every month. 

For 2020, you can expect the PBI to be at $.25- $.29 cents per kilowatt-hour (kwh). The PBI gets split between a credit to your existing electric bill and that cash payment. Since an average 6kW home solar system generates about 10,000 kwh annually, you can expect bill credits and payments of $2500 annually for a term length of 15-20 years! Even though the cash portion of the PBI is taxable income (meaning you’ll get a 1099), this program is a huge boon to you for installing solar.

 

Solar grant program

Rhode Island policymakers also created a fund for those who may not be sure if they’re going to live in their homes for the next 20 years to go solar as well. If you decide not to participate in the PBI above, you can elect to take a solar grant from the Rhode Island Renewable Energy Fund instead.

For 2020, the grant amount is up to $850 per kilowatt of installed solar, up to a maximum of $7,000. On an average 6kW system, that amounts to $5,100 upfront! This solar grant program is among the best in the nation. Way to go, Rhode Island!

 

Tax exemptions

Thankfully there are tax exemptions for solar power here as well. When you install a solar power system, your home goes up in value by a factor of 20 times your electricity bill savings. No one should ever be penalized for converting to renewable energy, a sentiment with which the Rhode Island legislature agrees. 

That’s why they passed a property tax law ensuring that your solar power system will never be assessed at any higher value than the equivalent standard, non-renewable energy production system. That means all that increase in value you get from a solar power system over a conventional system stays with you and not with the state tax collectors.

Those shiny new solar panels are also 100% exempt from all sales and use taxes when you purchase and install them.

Cost of solar panels in your part of Rhode Island after all applicable solar incentives

Showing data for:

Utility provider: Tohono OOdham Utility Auth
Utility bill: $ 136

Prices based on a 8.0kW system, after 26% federal tax credit

Solar prices near you

Cost range of local prices

$12,159-$14,861

Payback period

1.4-1.7 years

Net profit (savings less system cost)

$95,568-$116,805

Average size system installed in RI in 2020

8.0kW

Solar panel cost calculator

Best 10 solar companies in Rhode Island

8 solar companies in Rhode Island provide pricing on SolarReviews. Here are the best rated companies near you.

Solar guides for your Rhode Island city

For more information about going solar near where you live, check out the following resources:

Find local city information

 

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