Rhode Island Solar Panels

Rhode Island’s Renewable Energy Sales Tax Exemption eliminates the 7% state sales tax on qualifying solar equipment and components. This exemption applies to solar photovoltaic panels, inverters that connect to utility power lines, manufactured mounting racks and ballast pans, and monitoring equipment specified by system manufacturers. The exemption helps reduce your upfront costs when purchasing solar equipment for your home.

To qualify for this exemption, the equipment must be specifically designed for renewable energy generation and meet the definitions outlined in Rhode Island law. The exemption applies at the point of purchase, so you won’t pay sales tax when buying eligible solar components from retailers. This benefit is available for both homeowners and businesses installing solar systems in Rhode Island, with no application process required—the exemption is automatically applied on qualifying purchases. There are no deadlines or expiration dates for this exemption, as it remains in effect under current state law.

Rhode Island’s Residential Solar Property Tax Exemption allows homeowners to add solar energy systems to their property without increasing their property tax bill. When you install solar panels on your home, the added value from this improvement is completely exempt from local property taxes. This means your property assessment won’t go up due to your solar installation, even though solar panels typically increase your home’s market value.

The exemption applies to all solar energy equipment installed on residential properties, including solar panels, inverters, batteries, and related hardware. There’s no cap on the value of the exemption—whether your system adds $10,000 or $30,000 to your property value, none of that increase will be taxed. The exemption continues for as long as you own the solar system and remains at your property.

All Rhode Island homeowners who install solar energy systems on their primary or secondary residences are eligible for this exemption. There are no income requirements or application deadlines—the exemption applies automatically once your solar system is installed and operational. However, you should verify with your local tax assessor that the exemption has been properly applied to your property assessment to ensure you’re receiving the full benefit.

The Renewable Energy Fund (REF) Small-Scale Solar Grants program provides direct financial support to Rhode Island homeowners who install solar panels through the net metering program. Your solar installer will handle the application process on your behalf, and once your system is installed and passes a quality assurance evaluation, the grant payment goes directly to your installer. This grant is designed to reduce the upfront cost of going solar, making clean energy more accessible to Rhode Island residents.

The program offers $0.65 per watt of installed solar capacity, with a maximum grant of $5,000 per customer. If you’re adding battery storage to your solar system, you can receive an additional flat incentive of $2,000 per project. There’s also a cap of $190,000 per installer to ensure fair distribution across the state. Keep in mind that this is a popular program with limited annual funding, so it’s important to work with your installer early in the process.

This grant is only available for net-metered solar systems—you cannot combine it with Rhode Island’s Renewable Energy Growth (REG) program. When reviewing your contract with your solar installer, make sure it clearly shows the grant amount and includes a cancellation clause in case the program reaches full subscription before your application is processed. The program operates in funding rounds, so timing matters when planning your solar installation.

The Renewable Energy Growth (REG) Program is a Rhode Island state incentive administered by Rhode Island Energy that allows you to sell the electricity your solar system generates under a 20-year contract at fixed prices. Instead of traditional net metering, you’ll receive bill credits for the power you produce, plus a Production-Based Incentive (PBI) payment. Any generation that exceeds what you owe on your electricity bill is paid to you through direct deposit.

This program is available to Rhode Island Energy customers who install eligible renewable energy systems, including solar, wind, small-scale hydropower, and anaerobic digestion. You must choose between REG or the net metering program before installation—you cannot participate in both, and this decision is binding for the lifetime of your 20-year contract. If you choose REG, you are not eligible for grants from the Renewable Energy Fund (REF). However, REG participants can still enroll in the Connected Solutions battery demand response program if they install energy storage. To learn more about current rates and enrollment, visit Rhode Island Energy’s REG website or review their program materials.

The Affordable Solar Access Pathways (ASAP) Program is a Rhode Island state initiative that helps qualifying households in environmental justice areas access rooftop solar through a special solar lease. The program combines solar installation with energy efficiency services, and is designed specifically for homeowners who might not qualify for traditional solar financing. Unlike conventional solar options, ASAP requires no minimum credit score or income requirement, making clean energy accessible to more Rhode Island families.

The program offers a discounted solar lease with guaranteed first-year savings on your energy costs, with expected savings continuing throughout the 25-year lease term. Whether you’re on the standard residential rate (A-16) or the low-income rate (A-60), the lease is structured to provide immediate savings. The lease includes a 25-year performance guarantee along with all maintenance and warranty support, so you won’t have unexpected costs for repairs or upkeep.

To qualify, you must own and live in a 1-4 unit home located in a designated Environmental Justice Focus Area or a census tract eligible for the federal Low-Income Communities Bonus Credit Program. Your household income must be at or below 80% of the state median income, and your roof must be in good condition to support solar panels.

Important: The ASAP program is currently on pause and not accepting new applications. The Office of Energy Resources and the Renewable Energy Fund are reviewing next steps, including whether to identify a new program vendor. If you’re interested in this program, check back for updates on when applications may reopen.

Rhode Island Energy (formerly National Grid) offers a 1:1 Net Metering program that allows you to receive credit for the excess solar energy your system sends to the grid. Each month, the electricity your solar panels produce and export is credited against your total electricity consumption on a one-to-one basis. This means every kilowatt-hour (kWh) you send to the grid offsets one kWh you use from the grid at nearly the full retail rate—you’ll only lose about 2.2 to 2.5 cents per kWh in renewable energy and energy efficiency charges.

If your solar system produces more electricity than you use in a given month, those excess credits roll over indefinitely as dollar credits on your account. As of February 2024, you have additional flexibility: you can request to cash out these accumulated credits at the lower Last Resort Service supply rate, or you can transfer credits to another account under your name. This program provides excellent long-term value for homeowners, as your credits never expire and continue to offset your electricity costs month after month.