Pawtucket, RI 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 the solar system manufacturer. The exemption also covers solar storage tanks that are part of a solar hot water system.

The financial benefit depends on your system size and equipment costs. For a typical residential solar installation costing $25,000 in equipment, you would save approximately $1,750 in sales tax. This exemption applies automatically at the point of purchase when you buy qualifying equipment from Rhode Island retailers. There are no income requirements, application deadlines, or time limitations—the exemption remains available as long as the state law is in effect. Your solar installer will typically handle the tax-exempt purchase of equipment on your behalf, so you’ll see the savings reflected in your overall project cost.

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 for tax purposes remains the same as it was before installing solar, even though your home’s actual market value has increased.

The exemption covers 100% of the added value from your solar installation, with no dollar limit or cap on the benefit. The amount you save depends on your local property tax rate and the value of your solar system. For example, if your solar installation adds $30,000 to your home’s value and your local tax rate is 1.5%, you would save $450 annually in property taxes. This exemption continues for as long as you own the solar system, providing ongoing savings year after year.

To qualify, you must own a residential property in Rhode Island with a solar energy system installed. The exemption applies automatically once your solar installation is complete and assessed—you don’t need to file a separate application in most cases, though you should verify the exemption appears on your property tax bill. There are no income requirements or deadlines to meet, and the benefit remains in place as long as the solar system is operational on your property.

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 helps reduce your upfront costs, making solar energy more accessible and affordable.

The program offers $0.65 per watt of installed solar capacity, with a maximum grant of $5,000 per homeowner. If you’re adding a battery storage system along with your solar panels, you can receive an additional flat payment of $2,000. Keep in mind that each installer has an annual funding cap of $190,000, and the program has limited funding each year, so it’s a popular program that can fill up quickly.

This grant is only available for net-metered solar systems—you cannot combine it with Rhode Island’s Renewable Energy Growth (REG) program. Before signing your contract, make sure it clearly shows the grant amount and includes a cancellation option in case the program becomes fully subscribed before your application is processed. The most recent funding round opened on February 23, 2024, and new rounds are announced periodically throughout the year.

The Renewable Energy Growth (REG) Program is a state initiative administered by Rhode Island Energy that allows you to sell the electricity your solar system generates under a long-term contract with fixed prices. When you participate in REG, you sign a 20-year agreement that includes a fixed electricity price plus a Production-Based Incentive (PBI) payment. You’ll receive bill credits for the power you generate up to the amount you owe on your electricity bill, and any excess generation is paid to you through direct deposit.

To participate in REG, you must be a Rhode Island Energy customer. This program is available for solar, wind, small-scale hydropower, and anaerobic digestion systems. It’s important to know that you must choose between REG or the net metering program—you cannot participate in both, and your decision is binding for the life of the 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 have energy storage systems.

The Affordable Solar Access Pathways (ASAP) Program is a Rhode Island state initiative that helps qualifying homeowners in environmental justice areas access rooftop solar through a special solar lease arrangement. The program combines solar installation with energy efficiency services and includes a 25-year performance guarantee, maintenance, and warranty support. Unlike traditional solar financing, this program has no minimum credit score or income requirement, making solar accessible to more Rhode Island families.

The program offers discounted solar lease pricing designed to provide savings whether you’re on the standard residential utility rate (A-16) or the low-income rate (A-60). The program guarantees you’ll save money on energy costs during the first year, with expected savings continuing throughout the 25-year lease term. To qualify, you must live in a 1-4 unit home located in a designated Environmental Justice Focus Area or eligible census tract, have a household income at or below 80% of the state median income, and have a roof in good condition.

Important: The ASAP program is currently on pause and not accepting new applications. The Rhode Island Office of Energy Resources and the Renewable Energy Fund are reviewing next steps, including potentially identifying a new program vendor. Check back for updates on when the program 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 for every kilowatt-hour (kWh) you send to the grid, you receive a credit worth approximately the same as what you pay for electricity from the utility, minus small renewable energy and energy efficiency charges (about 2.2 to 2.5 cents per kWh).

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 with these credits—you can request a cash payout at the lower Last Resort Service supply rate, or transfer credits to another account you own. This program is available to Rhode Island Energy customers who install solar panels, making it an excellent way to reduce your electricity bills while contributing clean energy to your community.