2025 Solar Incentives Guide for Woonsocket, RI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Woonsocket.
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 Woonsocket?
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. Financial incentives like these are designed to encourage more Americans to switch their home over to renewable energy. Different kinds of incentives, such as discounts, cash back or monthly utility bill credits, may be available to you. Certain incentives may be provided via the state of Rhode Island, by your utility company or by county or municipality, while others are federal. Some broad categories of solar incentives include:
- Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar system. Property tax exemptions let you ignore the value that your solar panels add when you're calculating how much property tax you need to pay on your house.
- Net Metering: Net metering is an incentive you can get after your solar system is up and running. If you've signed a net metering agreement with your Woonsocket 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 places you might be refunded a percentage of the value.
- Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits differ from tax deductions.
- Rebates: A solar rebate is a partial refund after the purchase of your solar system. These could be offered by your local utility company, your state or your county. The rebates are usually applied before tax credits are calculated.
Federal Solar Incentives
When thinking about solar incentives, federal incentives might be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is probably the best-known federal solar incentive. The ITC provides you with a tax credit for a specific percentage of your solar system's cost.
The ITC originally covered 30% of the total cost of installing solar panels, and 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 cost of installation includes the panels themselves as well as the cost of accessories, equipment and labor. There is no maximum claim amount. The ITC can be applied to solar systems installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.
To find out exactly how much the ITC could save you, talk to your local Woonsocket solar panel installation expert.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as renaming it to the Clean Energy Credit). The new Clean Energy Credit is valid until 2035. American homeowners can now apply for a 30% credit for solar systems installed between January 1, 2022, and December 31, 2032. This new credit will then see a slight annual decrease until its expiration. Starting in 2023, the expansion will also make it easier to get credit for energy storage systems.
Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit will apply to you, talk to your local Woonsocket solar installation company.
State & Local Solar Incentives
Some solar incentives are often also provided by state and local governments. Like with federal incentives, these could include tax credits, rebates and more. The incentives — which might be given by your county or municipality, or by the state of Rhode Island — may be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Woonsocket
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. This increase in availability of solar initiatives over the last 15 years has helped increase nationwide solar energy use enormously. Speak with your local solar panel installation company today to learn more and to save as much money as possible on solar panels for your Woonsocket home.
EcoWatch's Woonsocket, RI Solar Incentives FAQs
I already have solar panels installed. Are there any incentives that I qualify for?
An excellent idea would be to talk to someone from the company that installed your solar panels – or speak to a local Woonsocket solar installer — to better understand which incentives you might qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are some of the environmental benefits of switching to solar?
Solar energy is renewable — by changing where you get your energy, you help reduce the strain on our planet's resources. Solar panels can also reduce the CO2 emissions from your home by 200 pounds annually, or roughly 4,000 pounds over 20 years.
Can I apply for incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order that incentives will be applied in might vary depending on which incentives you are claiming but usually yes, you can claim multiple types of incentives for your solar project. Check with your solar installer or a local tax professional to verify you are claiming all possible incentives and applying them in the correct order.
Can I use multiple types 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 discuss your plan with your local Woonsocket solar installation expert. They can help you with the plan for your project and also help you understand the various incentives that you might or might not qualify for.
Can I get any financial incentives when I add solar panels to a rental property, vacation home or commercial property?
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 can be claimed on a second home, so long as that home is in the United States and owned by you. There may be additional incentives available for commercial properties specifically, depending on the specifics.
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