2023 Solar Incentives Guide for Johnston, RI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Johnston.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Johnston?
Local Option - Property Tax Exemption for Renewable Energy Systems
Rhode Island C-PACE program
Renewable Energy Products Sales and Use Tax Exemption
Property Tax Exemption for Renewable Energy Equipment
Small Scale Solar Grants (Commerce RI)
Direct Ownership: $1.05/W
Third Party Ownership: $0.70/W
Solar Domestic Hot Water Heating
Direct Ownership: 25% of project contract price
Third Party Ownership: 10% of total contract price
Federal Residential Renewable Energy Tax Credit
Solar incentives encourage people to switch to renewable energy by providing financial incentives that lower the burden of solar panel installation and use. Incentives can include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered federally, while others are offered by the Rhode Island government or by your specific utility company, county or municipality. Some solar incentives you might qualify for are:
- Rebates: Solar rebates might be offered by your state or county, or by your local utility company. These rebates are essentially partial refunds that are applied after you pay for solar panels and before tax credits are calculated.
- Net Metering: Net metering becomes relevant after your solar system is up and running. If you have a net metering agreement with your Johnston utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this credit is dollar-for-dollar, while in other areas you may make back a percentage of the value.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
- Tax Exemptions: These can come in the form of property tax exemptions, which would allow you to exclude the value of your solar system when calculating the taxes you pay on your home. You may also qualify for an exemption on sales tax at the time of purchase.
Federal Solar Incentives
Federal solar incentives are probably the first thing that you think of when thinking about solar incentives. A federal incentive many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a certain percentage of the cost of your solar system.
The ITC was originally for 30% of the cost of solar system installation, although that number has fluctuated slightly over the last few years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total installation cost includes the panels themselves as well as the cost of labor, accessories and equipment. There is no maximum claim amount. The ITC applies to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
Have questions about how the ITC applies to your specific situation? Get in touch with your local Johnston solar panel installation expert to get more information.
In August 2022, the Inflation Reduction Act made revisions to the ITC, now titled the Clean Energy Credit. With the new provisions, solar installation projects that are completed between 2022 and 2032 can qualify for a 30% tax credit. This percentage will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. Starting in 2023, the program expansion will also make claiming credit for energy storage systems easier than ever before.
Click here to learn more about the new Inflation Reduction Act. To fully understand how the new Clean Energy Credit might apply to you, get in touch with your local Johnston solar installers.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. As with federal incentives, these might include tax credits, rebates and more. The incentives — which might be handled by the state of Rhode Island, or by your county or municipality — could be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Johnston
Solar incentives may be offered by the federal government, the Rhode Island government or your local utility company. The large number of solar incentives available has contributed to a large increase in solar energy use in the last 15 years. Your local Johnston solar panel installer can give you more information about which incentives you can apply for, and get you feeling good about making the change to renewable energy today.
Best Social Impact
- Expansive service area
- Makes charitable contributions
- Certified B Corp
- No leases or PPAs
- Quality of installation may vary by location
EcoWatch's Johnston, RI Solar Incentives FAQs
What if I am planning to add solar panels to a rental property, vacation home or commercial property? Can I still qualify for incentives?
While we recommend getting in touch with your local solar installer and/or tax professional to better understand what solar incentives apply to you, many apply to a second home, provided that it is in the United States and owned by you. There may be additional incentives available specifically for commercial properties, depending on the details.
How much will a solar system save me annually on my electric bill in Johnston?
Generally, Johnston homeowners who install solar panels save about $1,054.41 per year, or about $20,033.70 over 20 years after making the switch.
What are some environmental benefits of installing solar panels on my house?
You can reduce your carbon footprint by 200 pounds of CO2 annually when you switch to solar panels. This adds up to around 4,000 pounds over 20 years. Solar is also a renewable energy source, which means that making the switch reduces the drain on our planet's resources.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly known as the ITC and now titled the Clean Energy Credit, is set to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I use both solar and another type of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Make sure you go over your ideas with your local Johnston solar installer. They can help you as you plan for your project and also help you understand the various incentives that you will or won't qualify for.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.