2025 Solar Incentives Guide for Newport, RI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Newport.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Newport?
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 are designed to make renewable energy usage more affordable through financial incentives to help people install solar panels on their homes. Solar incentives could include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are given by the federal government, some by the Rhode Island government and some by your utility company, county or municipality. Types of solar incentives might include:
- Tax Exemptions: Tax exemptions can come in one of two forms. First, there is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption. This allows you to ignore the value added by your solar system when calculating property tax for your house.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
- Rebates: Solar rebates might be provided by your local utility company, or by your county or state. These rebates work as partial refunds that are applied after your purchase of a solar system and before tax credits are calculated.
- Net Metering: Net metering factors in after your solar system is up and running. If you have a net metering agreement with your Newport utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other areas you might get refunded a percentage of the value.
Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when thinking about solar incentives. You may have heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a certain percentage of the money you spend on solar panels for your home.
The ITC can be credited towards the value of a solar system installed on your primary or secondary residence in the United States. The solar system has to have been installed after January 1, 2006, on a property you own for you to claim the credit. Initially, the ITC applied to 30% of all system costs (panels, labor, equipment and accessories), although the total amount has fluctuated over the last few years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the amount you can claim.
Your local Newport solar panel installation expert can provide more information about the ITC and how it applies to your situation.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit re-raises the credit up to 30% for solar systems installed between 2022 and 2032. At this point, the percentage will be reduced slightly each year until the program expires in 2035. Beginning in 2023, it will also be easier to obtain credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. Your local Newport solar panel company 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 might also be offered at the local or state level. The incentives — which might be given by the state of Rhode Island, or by your county or municipality — might be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Newport
Solar energy use nationwide has gone up tremendously in the past 15 years, in part due to the proliferation of solar incentives. You can obtain these incentives from the federal government, the Rhode Island government or your local utility company. It is a good idea to talk to your local Newport solar installer to learn more about these incentives and to be sure that you're getting all the money you can for your solar panels.
EcoWatch's Newport, RI Solar Incentives FAQs
How can I learn if I qualify for solar incentives?
It's best to speak with your local Newport solar installer to get an understanding of which incentives your project may qualify for. In most cases, solar incentives apply to new solar systems installed on property you own (in the U.S.) between the dates specified by the incentive. Some incentives, like those given by the state of Rhode Island, might have other requirements.
Who installs solar panel systems near me?
To find the best solar panel installer in your area, check out our guide to the best solar companies in Newport.
Can I claim incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can receive both tax credits and rebates towards the cost of your solar panels. Depending on precisely which incentives you are applying for, they may apply in a different order. Be sure to talk to your solar installer or a local tax professional to verify that you are claiming incentives correctly and that you're getting the most money possible.
Can I receive any incentives when I add solar panels to a rental property, vacation home or commercial property?
While we recommend speaking with your local solar installer and/or tax professional to fully understand what solar incentives apply to you, many incentives apply to a second home, provided that it is in the United States and owned by you. There may be other incentives available specifically for commercial properties, depending on the details.
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