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Add State and Local Incentives to the 30% Federal Tax Credit
Learn about solar incentives and solar rebates. Find out what is available to you through federal, state and local programs, as well as local utilities.
State and Local Solar Panel Rebates
Combining the Federal tax credit with state incentives you qualify for may significantly reduce the cost of your solar PV system.

Read more good news about these programs and important tips on qualifying below.
Federal Solar Tax Credit
30% of the cost of your Solar Electric System and installation can be deducted from your federal tax bill.

Read more about this credit and what qualifies.





Solar Incentives by State… Click on your state to see what is available.    
Solar States


— You may be able to afford a larger solar PV system than you originally thought!
— You may be able to add the battery backup system you were planning to buy in a year or two



The Good News About Solar System Incentives, Qualifications and Tips
Some solar incentive programs pay you back over time, based on the energy you generate. Other solar incentives are one-time payments of rebates or credits. Incentive requirements and definitions may vary between states.

Incentive types can be specifically for residential, schools, business, or industrial; or inclusive of all of them. Solar incentives are mainly for grid tied systems and are sometimes available for off grid systems.

The incentives may be only for solar photovoltaic (electric), for electricity generated by wind, or for solar thermal (hot water generation). Other types of incentives may incorporate multiple solar technologies.

Programs with yearly or periodic application dates have credits or rebate rates that may be stepped down over time.

To qualify for incentives, your solar system may have to be installed by a licensed Photovoltaic System Installer, and/or connected to the grid by a licensed Electrician. This may be particularly true for Grid-Tie (Grid-Intertied) systems.
Plan ahead and act quickly. Many incentive programs are time sensitive. First-come-first-served programs, such as lotteries, can be spoken for in minutes after the opening of their application date.

Be careful including incentives in your PV system's budget due to requirements and possible deadlines to meet before qualifying.

Always consult a tax professional in regards to your eligibility for tax incentives.





Solar Incentive Glossary
Battery Backup Systems
Battery backup systems can store electricity from the grid or a fuel-powered generator to provide emergency power when the grid goes down. It can also store energy created PV system to power appliances and lights at night after the sun goes down.

Feed in Tariffs,
a Performance Based Incentive, or PBI

(Available for Grid Tied Systems.)
Feed-in Tariffs are typically long term contracts with your local utility for performance-based compensation.

The contracts are typically a 15-25 year purchase agreement at a guaranteed rate. The rate may decrease over time as specified in the agreement. Feed-in Tariffs may ultimately pay for your PV system or even exceed your initial investment depending on the specifics in the contract.

Originally started in Germany in 1990 and restructured in 2000 to include the right to interconnect to the utility grid. It was designed as an incentive to promote cost-effective renewable energy use and advancements in technologies. Due to its success, the current German policy is the cornerstone for the creation of many feed-in tariff programs around the globe.

Green Building Programs
(May be available for Off-grid and/or Grid-tied Systems.)
Green Building Programs are generally for new construction and remodeling, or just adding a solar electric system. The most common incentives are reductions or waivers of building permit fees. Some state or local organizations offer coupons that reduce construction and/or installation costs to homeowners. The home or business owner usually gives the coupon to their program-authorized installer/contractor. Once the system is installed the installer/contractor can be reimbursed for the amount of the coupon by the program's organization.

Grid-Tied PV Systems
Grid tied systems are inter-connected to send energy back to the grid when your solar electric system creates more than you're using; and you can receive energy from the grid when you're using more electricity than your system is generating at the moment. Learn more about grid-tied solar systems.

Loans
(May be available for Off-grid and/or Grid-tied Systems.)
State or local governments may offer low or zero interest loans for renewable energy projects. Terms are typically 10 years or less. If you are going to purchase or remodel a home that you are going to add a solar system to you may also want to see the Energy Star website for information on Energy Improvement Mortgages (EIMs).

Property-Assessed Clean Energy (PACE) financing may be offered by states that have been authorized to participate in this program. The amount of the loan is determined by a special assessment of your property and is typically repaid over a period of years.

Check with your local banks and credit unions as they may offer renewable energy loans for less than the prime rate. Also consider that mortgage loans and home equity loans can offer several advantages: longer terms, lower interest rates than conventional bank loans, and tax-deductible interest.
Net Metering
(Available for Grid Tied Systems.)
As of January 2012, only four states do not have net metering policies ‐ South Dakota, Mississippi, Alabama and Tennessee. These programs are for utility customers who generate their own electricity and feed excess energy back into the grid. Net-metered customers may use grid energy when their electrical demand exceeds their solar electric system's output. Solar electric credit rates are applied to the customer's total electric use and are shown on the utility bills.

The credit rates and rules vary from state to state. Unused solar electric system credits may expire in a specified time period or they may be carried over from year to year. The credits may only be applied to the utility bill or you may be allowed to get a refund check at the end of a designated period, usually the end of the year.

Off-Grid PV Systems
Off grid systems do not feed energy back to the grid. You may be completely independent from the grid or you may be receiving grid electricity to supplement your system (Grid-Assisted). Learn more about off-grid solar systems.

Solar PV System (Photovoltaics)
A solar PV system uses photovoltaic panels (or modules) to create electricity. This powers appliances, lights, and other electric equipment.

Solar Thermal System
A solar thermal system uses panels (or modules) to heat water. The hot water is typically used instead of a water heater for everyday water use, or in a radiant heating system to warm the air.

State and Local Tax Incentives
(May be available for Off-grid and/or Grid-tied Systems.)
  • Personal tax incentives include income tax credits (dollar-for-dollar reduction on what you owe) and income tax deductions (reduces your taxable income).
  • Property tax exemptions, exclusions and credit incentives generally exclude the added value of the system from your yearly property tax. Abatements may reduce a percentage of your yearly property tax over time.
  • State sales tax incentives can be an exemption from or a credit towards the applicable sales tax.
Utility Rate Discounts & Rebates
(Available for Grid Tied Systems.)
Some utilities and state or local programs may offer temporarily reduced rates on utility bills, or one time rebates on the installation of solar systems and purchases of energy efficient appliances and/or HVAC systems.


Updated: 12/03/2016
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Rhode Island Solar Incentives
Updated: 12/03/2016
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INCENTIVE NAME: Solar Easements
CATEGORY: Regulatory Policy
TYPE: Solar/Wind Access Policy
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI02R
LAST UPDATE: 12/10/2014

INCENTIVE NAME: Residential Solar Energy Property Tax Exemption
CATEGORY: Financial Incentive
TYPE: Property Tax Incentive
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI02F
DETAILS:
Incentive Amount - System assessed at no more than conventional energy system
WEBSITE: http://www.energy.ri.gov/renewable/tax/
LAST UPDATE: 05/06/2015

INCENTIVE NAME: Net Metering
CATEGORY: Regulatory Policy
TYPE: Net Metering
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI01R
DETAILS:
Applicable Utilities - Investor-owned utilities
System Capacity Limit - 5 MW (systems must be "reasonably designed" to generate only up to 100% of annual electricity consumption)
Aggregate Capacity Limit - 3% of peak load for Block Island Power Company and Pascoag Utility District
Other Utilities (National Grid): No aggregate cap.
Net Excess Generation - Credited at avoided cost; rolled over to next bill or purchased by utility
Ownership of Renewable Energy Credits - Not addressed
Meter Aggregation - Allowed
UTILITIES: The Narragansett Electric Co,
LAST UPDATE: 12/02/2015

INCENTIVE NAME: Rhode Island Renewable Energy Fund (RIREF)
CATEGORY: Regulatory Policy
TYPE: Public Benefits Fund
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI04R
DETAILS:
Types - Demand-side management (DSM), renewables, low-income energy assistance
Charge - Renewables: $0.0003 per kWh (0.3 mills per kWh)
Demand-side management (DSM): determined by utilities (with PUC approval)
WEBSITE: http://www.riedc.com/business-services/renewable-energy
LAST UPDATE: 05/06/2015

INCENTIVE NAME: Renewable Energy Standard
CATEGORY: Regulatory Policy
TYPE: Renewables Portfolio Standard
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
SOURCE: Renewable Energy Charge
CODE: RI08R
DETAILS:
Standard - 14.5% by 2019
Technology Minimum - No
Compliance Multipliers - Not applicable
REC Lifetime - 2 years (capped at 30% of the current year's obligation)
Credit Trading/Tracking System - Yes (NEPOOL-GIS)
Alternative Compliance Payment - $67.07 (2015); ACP set at $50 in 2003 dollars, adjusted annually to US Consumer Price Index.
WEBSITE: http://www.ripuc.ri.gov/utilityinfo/res.html
LAST UPDATE: 02/06/2015

INCENTIVE NAME: Renewable Energy Products Sales and Use Tax Exemption
CATEGORY: Financial Incentive
TYPE: Sales Tax Incentive
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI13F
DETAILS:
Incentive Amount - 100% exemption
Maximum Incentive - None
WEBSITE: http://www.energy.ri.gov/renewable/tax/
LAST UPDATE: 05/06/2015

INCENTIVE NAME: Green Building Standards for State Facilities
CATEGORY: Regulatory Policy
TYPE: Energy Standards for Public Buildings
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI12R
WEBSITE: http://www.ribcc.ri.gov/gba
LAST UPDATE: 02/04/2016

INCENTIVE NAME: Local Option - Property Tax Exemption for Renewable Energy Systems
CATEGORY: Financial Incentive
TYPE: Property Tax Incentive
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI20F
DETAILS:
Incentive Amount - Varies (local option)
LAST UPDATE: 05/06/2015

INCENTIVE NAME: Residential Renewable Energy Tax Credit (Corporate)
CATEGORY: Financial Incentive
TYPE: Corporate Tax Credit
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI21F
DETAILS:
Incentive Amount - 25% of costs
Maximum Incentive - Based on maximum system cost of $15,000 for PV, active solar space heating and wind;
Based on $7,000 maximum system cost for solar hot water and geothermal
Eligible System Size - PV: minimum module size of 24 square feet
Solar hot water: minimum collector area of 34 square feet
Active solar heating: minimum collector area of 125 square feet
Wind: minimum capacity of 250 watts at 28 mph
Geothermal: minimum coefficient of performance of 3.4 or minimum efficiency ratio of 16
Carryover Provisions - Credit may not be carried over to subsequent years
WEBSITE: http://www.energy.ri.gov/renewable/index.php
LAST UPDATE: 12/14/2015

INCENTIVE NAME: Interconnection Guidelines
CATEGORY: Regulatory Policy
TYPE: Interconnection
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI15R
DETAILS:
Applicable Utilities - Investor-owned utilities
System Capacity Limit - Not specified
Standard Agreement - No
Insurance Requirements - Not addressed
External Disconnect Switch - Not addressed
Net Metering Required - No
WEBSITE: http://www.ripuc.state.ri.us/utilityinfo/electric.html
LAST UPDATE: 12/05/2014

INCENTIVE NAME: Small-Scale Solar Grants (Commerce RI)
CATEGORY: Financial Incentive
TYPE: Grant Program
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
SOURCE: Rhode Island Renewable Energy Fund (RIREF); Alternative Compliance Payments (ACPs)
CODE: RI34F
DETAILS:
Incentive Amount - Solar PV: $1.15/W
Solar Domestic Hot Water Heating: 25% of project funding
Maximum Incentive - Solar PV: $10,000 per individual project
Solar Domestic Hot Water Heating: $5,000 per unit
Installation Requirements - Applicant must be approved by Commerce RI

WEBSITE: http://commerceri.com/finance-business/renewable-energy-fund/small-scale-projects/
LAST UPDATE: 10/14/2015

INCENTIVE NAME: Commercial-Scale Renewable-Energy Grants
CATEGORY: Financial Incentive
TYPE: Grant Program
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
SOURCE: Rhode Island Renewable Energy Fund (RIREF), Alternative Compliance Payments (ACPs)
CODE: RI35F
DETAILS:
Incentive Amount - $1.15/W For the first 0-50kW
$1.00/W For the 2nd 50kW (Up to 100kW)
$.85/W For the 3rd 50kW (up to 150kW)
$.70/W For the 4th 50kW (up to 200kW)
$.55/W For the 5th 50kW (Up to 250kW)
$.40/W For all installed capacity over the first 250kW
Maximum Incentive - $350,000
Installation Requirements - Varies with technology
Projects must be completed within 18 months of the contract signing
BUDGET: $1 million in 2013
WEBSITE: http://commerceri.com/finance-business/renewable-energy-fund/
LAST UPDATE: 05/06/2015

INCENTIVE NAME: Local Option - Property-Assessed Clean Energy Financing
CATEGORY: Financial Incentive
TYPE: PACE Financing
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI36F
LAST UPDATE: 07/13/2015

INCENTIVE NAME: Renewable Energy Growth Program
CATEGORY: Financial Incentive
TYPE: Performance-Based Incentive
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI37F
DETAILS:
Incentive Amount - Incentives will vary depending on the type of resource, the size of the system, and the geographic load zone area of the installation.

Solar is grouped into four categories based on size:
Small scale solar projects: up to 25kW
Medium scale solar projects: 25kW to 250 kW
Commercial scale solar projects: 250 kW to 1 MW
Large scale solar projects: 1 MW to 5 MW

Wind is grouped into two categories based on size:
Medium: 1.5 MW- 3 MW
Large: 3 MW- 5 MW

Anaerobic Digestion
Medium: 150 kW- 500 kW
Large: 501 kW- 1,000 kW

Small Scale Hydropower
Small: 10kW - 250 kW
Medium: 251 kW- 1,000 kW


Maximum Incentive - Varies with system size, technology and geographic load zone.
Terms - Depending on the type and size of project, The term lengths will be from 15 to 20 years. However, the board may recommend shorter terms for small scale solar projects.
Eligible System Size - Maximum nameplate capacity of 5 MW.
Equipment Requirements - Projects must be new and not under construction at the time of application, with the exception of preparatory site work that is less than 25% of the total project cost.
Ownership of Renewable Energy Credits - Except for small scale Residential projects, the environmental and other attributes of the Distributed Generation projects are transferred to the Electric Distribution Company.
WEBSITE: https://www.nationalgridus.com/narragansett/business/energyeff/4_dist_gen.asp
LAST UPDATE: 04/19/2016

INCENTIVE NAME: Renewable Energy Professional Certification
CATEGORY: Regulatory Policy
TYPE: Solar/Wind Contractor Licensing
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: RI16R
WEBSITE: http://www.energy.ri.gov/renewable/REP/
LAST UPDATE: 11/12/2015

INCENTIVE NAME: Energy Revolving Loan Fund
CATEGORY: Financial Incentive
TYPE: Loan Program
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
SOURCE: American Recovery and Reinvestment Act
CODE: RI39F
DETAILS:
Loan Term - Loan terms of 5-10 years with interest rate between 1%-3%
WEBSITE: http://www.commerceri.com/finance/ERLF.php
LAST UPDATE: 12/10/2014