Warwick, 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, including external heat exchangers when shipped as part of the system.

The financial benefit equals 7% of the purchase price of eligible equipment. For example, on a typical residential solar system costing $25,000 in equipment, you would save $1,750 in sales tax. This exemption applies automatically at the point of sale when you purchase qualifying renewable energy products from Rhode Island retailers. There are no income requirements, application deadlines, or caps on the exemption amount—it’s available to all Rhode Island residents who purchase eligible solar equipment.

It’s important to note that this exemption has specific limitations. Standard materials that could be fabricated into mounting racks are not exempt, nor are standard hot water tanks unless they’re specifically designed as solar storage tanks. Additionally, general plumbing and electrical fixtures don’t qualify unless they’re shipped from the manufacturer as an integral part of an exempt item. Your solar installer should be familiar with which components qualify and will typically handle the tax exemption details during your purchase.

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 exempt from local property taxes, meaning you won’t pay additional property taxes on the increased home value that results from your solar installation.

This exemption applies to all residential solar energy systems in Rhode Island and remains in effect for as long as you own the system. There are no dollar amount caps on the exemption, no application deadlines, and no time limitations—the tax exemption continues indefinitely. To qualify, the solar equipment must be installed on your primary residence or residential property. This benefit helps make solar energy more affordable by ensuring that while your home’s value increases with solar panels, your property tax assessment does not.

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. There’s also a $190,000 cap per installer to ensure fair distribution across the state. If you’re adding battery storage to your solar system, you can receive an additional flat incentive of $2,000 per project. Keep in mind that this grant is only available for net-metered systems—you cannot combine it with the Renewable Energy Growth (REG) program.

This is a popular program with limited annual funding, so it can become fully subscribed. Make sure your contract with your installer clearly shows the grant amount and includes a cancellation clause in case the program runs out of funding before your project is approved. The most recent funding round (Round 24-1) opened on February 23, 2024 at 9am, and new rounds are announced periodically throughout the year.

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

This program is available to Rhode Island Energy customers for eligible renewable technologies including solar, wind, small-scale hydropower, and anaerobic digestion. You must choose between the REG Program or net metering—you cannot participate in both, and your decision is binding for the life of the contract. If you select the REG Program, you are not eligible for grants from the Renewable Energy Fund (REF). However, REG participants can still enroll in Rhode Island Energy’s Connected Solutions battery demand response program if you have energy storage. To learn more about program details, pricing, and how to apply, 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 homeowners in environmental justice areas access rooftop solar through a special lease arrangement. The program combines solar installation with energy efficiency services, requiring no minimum credit score or income level to participate. It includes a 25-year performance guarantee along with maintenance and warranty support throughout the lease term.

The program offers discounted solar lease pricing designed to provide savings whether you’re on the standard residential rate (A-16) or low-income rate (A-60). You’re guaranteed to save money on energy costs during the first year, with expected savings continuing over the full lease period. 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 Office of Energy Resources and Renewable Energy Fund are reviewing next steps, including potentially identifying 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 produces. Here’s how it works: each month, the electricity your solar panels send to the grid is credited against your total electricity consumption on a one-to-one basis. This means every kilowatt-hour (kWh) you export is worth the same as every kWh you use from the grid, helping to significantly reduce or even eliminate your monthly electric bill.

If your solar system produces more electricity than you use in a given month, those excess credits roll over to future months as dollar credits, and they never expire. The credits retain nearly the full retail electricity rate, with only a small deduction of approximately 2.2 to 2.5 cents per kWh for renewable energy and energy efficiency charges. As of February 2024, you also have the option to request a cash payment for excess credits at the 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 maximize the financial benefits of your solar investment while maintaining flexibility in how you use your credits.