2023 Solar Incentives Guide for Middletown, RI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Middletown.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Middletown?
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 are designed to encourage homeowners to make the switch to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. These incentives may include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are offered by the federal government, some by the state of Rhode Island and some by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government. (A tax credit is different from a tax deduction.)
- Tax Exemptions: Your solar panels might qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you exclude the added value of the solar panels when calculating property taxes on your house.
- Net Metering: Net metering becomes relevant after your solar system is up and running. If you have in place a net metering agreement with your Middletown utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some places, this is a dollar-for-dollar credit, while in others you might get refunded a percentage of the value.
- Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar panels. Counties or states will also offer limited-time rebates at various times. Any rebates you receive will usually come off the total price before any tax credits are calculated.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have heard of. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC offers a tax credit for a set percentage of your solar system's cost.
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, equipment, accessories and labor. This credit can apply towards a solar panel system installed on a primary or secondary residence in the United States that you own. Originally, you could claim 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.
To best understand how the ITC may apply to your situation, call your local Middletown solar panel installer and request more information.
The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The new Clean Energy Credit extends until 2035. You can now receive a 30% credit for solar systems that began installation on or after January 1, 2022 and will be done by December 31, 2032. This credit will then be decreased by a few percentage points every year until the date of expiration. Starting in 2023, it will also be easier to qualify for credits for energy storage systems under the new laws.
Click here to learn more about the new Inflation Reduction Act. Your local Middletown solar panel installer can answer any questions you have and explain how the new Clean Energy Credit applies to you.
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 your county or municipality, or by the state of Rhode Island. Certain incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Middletown
Solar incentives may come from the federal government, the Rhode Island government or your local utility company. The growing number of incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. Speak with your local solar panel installation expert today to discover more about the various programs and to save as much money as possible on solar panels for your Middletown home.
EcoWatch's Middletown, RI Solar Incentives FAQs
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