2025 Solar Incentives Guide for Smithfield, RI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Smithfield.
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 Smithfield?
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 intended to encourage homeowners to switch to renewable energy by offering financial incentives that lower the burden of solar panel installation and use. Incentives may include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered by the federal government, while others are offered by the Rhode Island government or by your utility company, county or municipality. Some broad categories of solar incentives include:
- Tax Exemptions: Tax exemptions may come in two forms. First, there is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when paying property tax on your home.
- Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your Smithfield 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 credit is dollar-for-dollar, while in other places you might receive a refund equivalent to a percentage of the value.
- Rebates: A rebate is a partial refund after the purchase of your solar panels. These could be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
Best for Leasing
Sunrun
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- Many financing options
- Some reported issues with customer service
- Some reported issues with door-to-door sales
Federal Solar Incentives
When thinking about solar incentives, you probably think of federal incentives first. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. The ITC 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 applies to the total cost of installing a solar system, including the panels themselves as well as equipment, accessories and labor. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence located in the United States that you own. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.
To best understand how the ITC may apply to your situation, reach out to your local Smithfield solar panel installation expert and request more information.
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. Now, solar installation projects begun after January 1, 2022, and finished by December 31, 2032, can qualify for a 30% tax credit. This percentage will then see a slight annual decrease until the current Clean Energy Credit expires in 2035. Starting in 2023, the program expansion will also make credits for energy storage systems even easier to claim.
More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit applies to you is to talk with your local Smithfield solar panel company.
State & Local Solar Incentives
Tax credits, rebates and more might be provided at multiple levels. In addition to federal solar incentives, there are often state and local ones as well. Some incentives are ongoing, while others are offered for only a limited time. Your local incentives could come from the Rhode Island government, or from your specific county or municipality.
Next Steps for Installing Solar in Smithfield
You can apply for and receive solar incentives from the federal government and the Rhode Island government, as well as from your local utility company. Growing availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. Contact your local solar panel installation expert today to find out more information and to save the most money possible on a solar system for your Smithfield home.
EcoWatch's Smithfield, RI Solar Incentives FAQs
How can I learn if I qualify for different solar incentives?
Generally, solar incentives apply to:
- a new solar system
- installed on property that you own
- within the U.S.
- between the dates specified by a particular incentive.
Specific incentives, including ones handled by the Rhode Island government or by your county/municipality, might have additional qualifications. Talk to your local Smithfield solar installer to find out what incentives your project will qualify for.
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 Smithfield.
When does the federal solar tax credit end?
The federal solar tax credit, formerly known as the ITC and now titled the Clean Energy Credit, is slated 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 a combination of multiple types of renewable energy to power my home?
You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Be sure to talk through your plan with your local Smithfield solar installer. They can help you plan your project and also help you understand the various incentives that you might or might not qualify for.
Can I claim incentives for adding solar panels to a vacation home, rental property or commercial property?
While we recommend talking to your local solar installer and/or tax professional to best understand what solar incentives apply to you, many incentives can be claimed on a second home, as long as it is in the United States and owned by you. There may be additional incentives available for commercial properties specifically, depending on the details.
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.