2025 Solar Incentives Guide for Lincoln, RI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Lincoln.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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What Solar Tax Credits, Incentives, and Rebates are Available in Lincoln?
Local Option - Property Tax Exemption for Renewable Energy Systems
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
Source: https://www.dsireusa.org/
Solar incentives mitigate the cost of installing a solar panel system on your home. These financial incentives are in place to encourage more homeowners to make the switch to renewable energy. Incentives might include things like discounts, cash back or monthly utility bill credits. Some incentives are handled federally, while others are provided by the Rhode Island government or your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Tax Exemptions: Your solar system could qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions allow you to ignore the value added by your solar panels when calculating property taxes on your home.
- Net Metering: Net metering becomes relevant after your solar panels are up and running. If you have in place a net metering agreement with your Lincoln utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in other places you might get refunded a percentage of the value.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.
- Rebates: Solar rebates may be offered by your local utility company, or by your county or state. These rebates are essentially partial refunds that are applied after your purchase of solar panels and before tax credits are calculated.
Federal Solar Incentives
When thinking about solar incentives, federal incentives are likely the first thing that comes to mind. You might have heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a certain percentage of the money you spend installing solar panels.
The ITC can be applied to solar systems installed after January 1, 2006, and allows you to deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. This credit can apply towards solar panels installed on a primary or secondary residence in the United States that you own. The original amount you could claim was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.
Curious how the ITC might apply to your specific situation? Get in touch with your local Lincoln solar panel installer to get more information.
In August 2022, the ITC (now called the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The Clean Energy Credit lasts until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit. This amount will decrease slightly each year until the current program ends. 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 understand how the new Clean Energy Credit might apply to you, get in touch with your local Lincoln solar installation company.
State & Local Solar Incentives
Not all solar incentives are federal; tax credits, rebates and more may be offered at the state and local level. Incentives may be handled by the state of Rhode Island, or by your county or municipality. Some incentives are available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Lincoln
Solar energy use nationwide has gone up tremendously in the last 15 years, in part due to the proliferation of solar incentives. You might receive these incentives from the federal government, the Rhode Island government or your local utility company. Your local Lincoln solar panel installer can help you learn more about which incentives you should apply for, and get you feeling good about making the change to renewable energy today.
EcoWatch's Lincoln, RI Solar Incentives FAQs
My home already has solar panels installed. Does my system qualify for any incentives?
You should plan to talk to someone from the company that installed your solar panels – or speak to a local Lincoln solar installer — to clarify which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How much will solar panels save me annually on my electric bill in Lincoln?
Once you add solar panels to your house in Lincoln, you can expect to save approximately $1,054.41 per year, or about $20,033.70 over 20 years.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly called the ITC and now called the Clean Energy Credit, is set to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
If I change out my appliances for ones that can use solar energy, are there any credits that I can claim?
The new Inflation Reduction Act includes provisions for a number of incentives meant to reward homeowners for making eco-friendly upgrades. Some incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
What if I want to add a solar system to a vacation home, rental property or commercial property? Do I still qualify for incentives?
Many solar incentives apply to a property located within the United States that you own, and most secondary residences will fall under this distinction. Other solar incentives may be available for commercial properties, depending on the specifics. We recommend reaching out to your local solar installer and/or tax professional to best understand what incentives apply to your specific situation.
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