Rhode Island’s Solar Incentives: A Quick Summary for Homeowners in RI
If you’re considering solar for your home, RI’s solar incentives make your investment more affordable (and profitable!)
There’s no way to ignore it: solar energy is thriving in Rhode Island. Drive through any neighborhood and you’re bound to see at least one house with solar panels. But what’s creating all of this activity?
It’s the combination of RI’s solar incentives and the federal government’s push for renewable energy sources. Below are all of the incentives available for Rhode Island homeowners:
- Federal Investment Tax Credit for solar (ITC)
- Renewable Energy Growth Program (REG)
- Renewable Energy Fund Grant (REF)
- Residential Solar Energy Property Tax Exemption
- Renewable Energy Sales and Use Tax Exemption
The solar incentive programs in Rhode Island are pretty incredible, but they will not last forever. In fact, the value of these programs decrease over time. If you want to maximize your savings by securing current rates, schedule a Meet & Greet with us. Together we’ll figure out if solar is the right investment for your home.
Renewable Energy Growth Program (REG)
In 2004, Rhode Island enacted one of the first renewable portfolio standards in the U.S. It requires utilities in RI to generate 16% of their electricity from renewable sources by 2020. Thus came the Renewable Energy Growth Program, a state-approved incentive run by National Grid. It makes you, the homeowner, a solar electricity supplier for the Grid.
National Grid pays you for the electricity you produce at a set rate. That amount is applied to your electricity bill every month. If you produce more energy than you use, National Grid sends you a check for the remaining balance.
The rates National Grid pays you for electricity are determined by two factors:
- The size of your panel system (how many kilowatts)
- The option you choose (15 or 20 years)
The rates per option as of April 2017:
- 15-year option is 34.74 cents per kilowatt hour (kWh)
- 20-year option is 30.85 cents per kWh
- The rate you secure when you enroll extends the entire period
- Those incentive enrollment rates drop as time goes by, so act sooner than later
Renewable Energy Fund Grant (REF)
The Rhode Island Commerce Corporation (Commerce RI) offers homeowners grant money (as a rebate) for purchasing solar PV systems. The REF is state-wide effort to increase local production of renewable energy, create jobs, and boost the sustainable energy economy in RI.
As a homeowner, you’re eligible to apply for the “small-scale program.” The grant money assists you to pay for the solar installation, sometimes 20-30% of the total cost. Add that to the 30% federal solar tax credit, and you gain considerable savings for installing solar.
For a 10kw system (the maximum size to be eligible for the REF), you can receive up to an $8,000 rebate.
Federal Solar Investment Tax Credit (ITC)
Homeowners in the United States (including RI) who purchase and install solar panels receive a 30% tax credit from the federal government. The tax credit essentially pays for 30% of the total cost of your system.
For example, if you purchase a $20,000 solar PV system for your home, you’ll receive $6,000 in the form of a tax credit.
Even if you don’t have enough tax liability to claim the entire credit in one year, you can “roll over” the remaining credits into future years for as long as the tax credit is in effect.
When you combine the ITC with available RI solar incentives, the affordability and return on your investment increases significantly. However, these options are only available when you purchase solar. Leasing and Power Purchase Agreements (PPA) don’t qualify you for these federal and state incentive programs.