By Newport Renewables · Updated September 2026 · Installing solar in Rhode Island since 2010

Quick answer: For many Rhode Island properties with a sunny roof and average-or-higher electricity use, solar can still be worth it in 2026. Rhode Island's electricity prices are among the highest in the country (about 28.3¢/kWh in April 2026, according to U.S. Energy Information Administration data). The state's Renewable Energy Fund grant now covers $1.65 per watt, up to $14,500, for homeowner-owned systems. Based on the assumptions in our example below, a typical home system could pay for itself in roughly 4 to 8 years, depending on which incentive path you choose. Solar is usually not a good fit if your roof is heavily shaded, needs replacing soon, or your electricity use is low.

Rhode Island solar at a glance (2026)

What does solar cost in Rhode Island?

Installer quote data puts Rhode Island installation prices around $2.77 per watt in 2026.

Here's what that means by system size, before and after the REF grant:

Gross costs assume $2.77/W. Actual quotes vary with roof complexity, equipment, and electrical upgrades. REF grants apply to net-metered, homeowner-owned systems, and funding in each round is limited.

Solar equipment is also exempt from Rhode Island's 7% sales tax.

What size system do you need? Size the system to your usage, not your roof. The average Rhode Island household uses about 594 kWh per month, or roughly 7,100 kWh per year. A well-placed system in Rhode Island typically produces somewhere around 1,000 to 1,300 kWh per year for each kilowatt installed, depending on orientation and shading. For an average home, that works out to roughly 6 to 7 kW to cover most of its annual use. Your last 12 months of Rhode Island Energy bills are the best place to start.

Rhode Island's two solar incentive paths: REF vs. REG

Rhode Island has two main state solar programs, and you can't use both on the same system. The state's REF regulations exclude projects enrolled in the Renewable Energy Growth program. This is one of the most important decisions in a Rhode Island solar purchase, and it's worth understanding before you sign anything.

Path 1: Net metering + REF grant

• How it works: You get an upfront grant, applied for by your installer, that lowers the price of the system. Once it's running, your system offsets your electricity use, and extra power sent to the grid earns credits on your Rhode Island Energy bill.

• Best for: Homeowners who want the lowest upfront cost and the fastest payback.

• What to know: REF funding is limited and released in rounds. Your installer applies on your behalf, and approval should come before installation. Without an approval letter, the grant isn't guaranteed.

Path 2: Renewable Energy Growth (REG) program

• How it works: Rhode Island Energy pays you a fixed rate for every kWh your system produces. For 2026, home-sized systems (up to 15 kW) receive 31.55¢ per kWh over a 15-year contract, and systems from 15 to 25 kW receive 28.65¢ per kWh over 20 years. The rate is set each program year and locked in when you enroll. Credits apply to your bill up to what you owe, and the rest is paid to you directly.

• Best for: Owners who can pay more upfront and value long, predictable payments, especially if they expect to stay in the property for the full contract.

• What to know: You don't get the REF grant, so your upfront cost is higher. Ask how the system will be treated after the contract ends.

Which path comes out ahead?

Under the old $5,000 REF cap, REG often came out ahead over the long run. With the 2026 grant at $1.65 per watt, our example below shows the REF path ahead on both payback and 25-year savings for a typical home. REG still has real advantages. Its rate is fixed for 15 years regardless of how much power you use or how net metering rules change, and it pays the same rate for every kWh you produce. A good installer should model both paths using your actual usage before you sign. If you're only shown one, it's reasonable to ask why.

Worked example: a typical Rhode Island home

Here's an illustrative estimate for an average Rhode Island household, with a system sized to cover its annual electricity use.

Assumptions:

• 6.5 kW system at $2.77/W, for a gross cost of $18,005

• Production of 1,100 kWh per kW per year, or about 7,150 kWh in year one. This is on the conservative end; some modeling for Providence comes out higher.

• Net metering value of about 25¢/kWh on average. This assumes roughly 40% of your solar is used on-site, offsetting the full retail rate, and 60% is exported and credited at 80% of the standard credit under Rhode Island's post-2023 rules.

• Panel output declines 0.5% per year

• No electricity price increases. If rates keep rising, actual savings could be higher. If they fall, savings would be lower.

• $2,500 set aside for one inverter replacement over 25 years

*Assumes the system moves to net metering after the 15-year REG contract ends. Confirm post-contract terms with Rhode Island Energy.

What this example shows:

1. At the 2026 grant level, the upfront grant does much of the work. An estimated payback of around four years on equipment designed to produce for 25 years or more is a solid return.

2. Even at the old grant level, the estimated payback was under eight years, without assuming any increase in electricity prices.

3. REG pays more per kWh but costs more upfront. Its main advantage is certainty: a locked rate for 15 years that doesn't depend on your usage or on future net metering changes.

Your results will differ. Roof angle, shading, usage, equipment, and future rates all change the outcome. Whatever installer you work with, you should be able to see the math behind their estimate, line by line.

How net metering works with Rhode Island Energy

Rhode Island Energy (formerly National Grid in Rhode Island) serves most homes and businesses in the state, and its net metering rules largely decide how much your extra power is worth.

When your panels produce more than you're using, which is common at midday, the extra power goes to the grid and you receive a bill credit. At night and on cloudy days, you draw from the grid and use those credits.

For projects initiated after April 15, 2023, Rhode Island reduced the net metering credit by 20%, according to the Office of Energy Resources, so newer systems earn about 80% of the older credit on power sent to the grid. A second rule matters for sizing: net-metered systems must be sized to your property's three-year average usage, and power produced beyond 100% of your usage is credited only at Rhode Island Energy's lower avoided-cost rate. In practice, it usually makes sense to size your system to what you actually use and to use as much of your solar power directly as you can. A battery, or shifting laundry and dishwashing to daytime hours, can help.

If you're a Pascoag Utility District or Block Island Utility District customer, different net metering rules may apply. Check with your utility directly.

Other Rhode Island solar incentives

Beyond REF and REG, several smaller incentives can add up:

• Sales tax exemption: Solar equipment is exempt from Rhode Island's 7% sales tax.

• Property tax exemption: Under state law, solar on residential and manufacturing properties is exempt from local property taxes, so the added value shouldn't raise your tax bill. Commercial systems are treated differently. They generally pay a state-set tangible property tax unless the city or town has exempted them.

• Energy Storage Rebate (new in 2026): The Office of Energy Resources pays $250 per kWh of battery capacity, up to $8,000 per project, or $500 per kWh, up to $16,000, for income-eligible households. Recipients must enroll the battery in a demand-response program, and this rebate can't be combined with the REF storage adder on the same battery. Funding is limited.

• REF storage adder: An alternative battery incentive when a battery is installed alongside a REF-funded solar system. Ask your installer to compare it with the Energy Storage Rebate.

• ConnectedSolutions battery payments: Rhode Island Energy pays $225 per average kW your battery delivers during summer peak events, and you can lock that rate in for your first five summers.

• Leases and PPAs: These third-party ownership models may let the system owner claim the commercial federal credit and pass some savings on to you. Read the escalator clause and buyout terms carefully. The 2026 REF grant rate applies to homeowner-owned systems.

When solar may not be worth it in Rhode Island

Solar isn't right for every property. It may not make financial sense if:

• Your roof is heavily shaded. Trees and nearby buildings can cut production sharply. A thorough quote should include a shade analysis. If yours doesn't, ask for one.

• Your roof needs replacing in the next 5–10 years. Removing and reinstalling panels later adds cost. If your roof is near the end of its life, it's usually better to replace it first or at the same time.

• Your electricity use is low. Households using less than about 500 kWh per month may not save enough to justify the investment, especially since power produced beyond your usage earns a lower credit.

• You plan to move in the next few years. Payback takes several years. Owned solar may add resale value, but how much depends on the buyer and the market.

• Your roof faces mostly north. North-facing arrays typically produce significantly less. East- and west-facing roofs can still work, with somewhat lower output.

If any of these apply, community solar may be worth a look. It lets you subscribe to a shared solar project and receive bill credits without installing anything on your roof.

Does Rhode Island get enough sun for solar?

For most well-placed roofs, yes. Rhode Island averages roughly 4.7 peak sun hours per day, which is generally enough for solar to make financial sense.

A few things people often get wrong about New England solar:

• Cool temperatures help. Solar panels operate more efficiently in cooler weather, so a clear spring day can be a strong production day.

• Clouds reduce output but don't stop it. Panels still produce on overcast days, just less.

• Snow often slides off. Panels are smooth and tilted, so snow tends to clear on its own after a storm, though timing varies. Lower winter production mostly comes from shorter days.

• Good production estimates account for local weather. Estimates based on historical weather data already factor in cloudy months, so it's worth asking any installer what data their estimate uses.

Is solar worth it for Rhode Island businesses?

For many businesses, the case can be even stronger than it is for homeowners.

Why commercial solar often pencils out well in Rhode Island:

• Daytime load lines up with solar production. Warehouses, manufacturers, offices, and schools often use most of their power during daylight hours, when solar produces. That lets more of each kWh offset full-price grid power.

• REF also funds commercial projects. Rhode Island Commerce runs a separate Commercial Scale grant program for business installations.

• Solar carports can turn parking lots into assets. Parking lots can host solar without using roof space, and they add covered parking for customers and employees.

• Tax-exempt organizations have options too. Schools, municipalities, and nonprofits have used direct-pay provisions to capture federal credit value. Eligibility rules have changed, so confirm current options with your tax advisor.

Results from Newport Renewables projects in Rhode Island

These are Newport Renewables projects, not national averages. Figures reflect each project's own conditions and the incentives available when it was built. Every project is different.

Providence distribution warehouse:

• 69% of the building's energy use offset by solar

• 5.4-year payback and a 19.3% rate of return

• $142,000 in first-year savings

• About $3 million in projected 25-year cash flow

Warwick Public Schools:

• 460 kW across three campuses, using rooftop arrays and solar carports

• Financed through a tax-exempt lease, with federal credit value captured through direct pay alongside REG incentives

• Effective cost after incentives: $702,000

• $82,000 in annual savings and an 8.6-year simple payback

• $2.04 million in projected net savings to the education budget over 25 years

How to protect yourself when buying solar in Rhode Island

Solar is a significant purchase, and Rhode Island gives buyers some useful protections. Here's how to use them:

1. Check the installer's DBR registration. Under the Residential Solar Energy Disclosure and Homeowners Bill of Rights Act, residential solar retailers in Rhode Island must register annually with the Department of Business Regulation. An unregistered company is a red flag.

2. Get the REF grant in writing, with a cancellation option. The Office of Energy Resources recommends that your contract clearly show the grant amount and include an option to cancel if the grant round fills before you're approved.

3. Wait for grant approval before installation. The grant is only guaranteed once you have an approval letter.

4. Ask who does the installation. Does the company use its own crews or subcontractors? Who handles warranty service years from now?

5. Ask for the math. A good quote shows system size, expected annual production, the incentive path used, the net cost, and the assumptions behind the payback estimate. If you only see a monthly payment, ask for the full numbers.

6. Compare REF and REG. Ask your installer to model both paths for your property.

7. For leases and PPAs, read the escalator. Annual payment increases can erode your savings over a long contract, so run the numbers over the full term.

Frequently asked questions

Is solar worth it in Rhode Island's winters?
For most well-placed systems, yes. Panels produce less in winter mainly because the days are shorter, but cooler temperatures help efficiency, and snow often slides off on its own. Good annual production estimates already account for local weather.

Do solar panels raise property taxes in Rhode Island?
For homes, generally no. Rhode Island law exempts solar on residential properties from local property taxes, so the added value shouldn't raise your tax bill. Owned systems may also add resale value.

Should I add a battery?
A battery provides backup power during outages and qualifies for meaningful incentives. The state's Energy Storage Rebate pays up to $8,000 upfront, and Rhode Island Energy's ConnectedSolutions program pays $225 per kW each summer for supporting the grid during peak demand. Whether a battery pays for itself depends on your usage and how much you value backup power. It isn't required for solar to make sense.

About Newport Renewables

Newport Renewables has designed and installed solar in Rhode Island since 2010. Our work includes:

• 18+ megawatts of solar installed in a single year

• Rooftop solar on three Rhode Island State Capitol buildings

• The first Rhode Island state agency solar carport, at the Public Utilities Commission

• A rooftop array on the historic Oliver Belmont mansion on Newport's Bellevue Avenue

Newport Renewables has been named to Solar Power World's Top 500 U.S. Solar Contractors, and our in-house team designs, installs, and supports the systems we build.

Considering solar for your business, property, or new home? Don't hesitate to talk to our team.