Cost of Going Solar in Rhode Island

Cost of Going Solar in Rhode Island 2025

Rhode Island may be the smallest U.S. state by area, but it has one of the most ambitious clean energy goals in the country. With electricity rates among the highest in New England, many homeowners are turning to solar to cut long-term utility expenses. In 2025, an average household in Rhode Island typically needs a 6- to 7-kilowatt (kW) solar system to meet its energy demand. The average solar cost for this system size ranges between $19,000 and $22,000 before incentives, depending on the installer, roof type, and equipment brand.

After applying the 30% federal Investment Tax Credit (ITC), the net cost drops to around $13,000 to $15,400. Rhode Island residents can also benefit from the state’s Renewable Energy Fund (REF) rebates and the Renewable Energy Growth (REG) Program, both of which further reduce upfront costs.

If the ITC steps down or expires after December 31, 2025, the solar power cost could rise significantly, potentially adding 25% to 30% to total expenses. That makes 2025 an especially strategic time for Rhode Islanders to transition to clean energy while full federal support remains available.

Average Solar Installation Cost in Rhode Island (2025)

System Size	Pre-Incentive Cost	Post-ITC Cost (30%)	Annual Savings	Estimated Payback Period
5 kW	$15,000 – $17,000	$10,500 – $11,900	$1,100 – $1,300	8 – 10 years
6 kW	$17,500 – $19,500	$12,200 – $13,600	$1,300 – $1,500	7 – 9 years
7 kW	$19,000 – $22,000	$13,300 – $15,400	$1,500 – $1,700	7 – 8 years
10 kW	$26,000 – $29,000	$18,200 – $20,300	$2,000 – $2,300	6 – 8 years

(Figures represent statewide averages for 2025, including equipment, installation, and permitting.)

Solar Cost Basics

The solar panel cost in Rhode Island is shaped by both tangible hardware and intangible expenses known as solar soft costs. Hardware expenses include the panels, inverters, and other physical components of the system, while soft costs cover the human and administrative work required to design and install it. On average, hardware accounts for 55% to 60% of total solar costs, while soft costs make up 40% to 45%.

Hardware Costs

Hardware includes everything that physically produces and delivers solar electricity:

Solar Panels: The largest single cost component, roughly 30% of the total. Rhode Island homeowners often choose monocrystalline panels for their efficiency and sleek design, though polycrystalline options remain popular for cost-conscious buyers
Inverters: Making up about 10% of the total cost, inverters convert DC power into usable AC electricity. Microinverters are increasingly common in Rhode Island, particularly for homes with partial shading or complex roof angles
Mounting Hardware and Wiring: Racking systems, wiring, and electrical connections represent 8% to 10% of total hardware cost. Systems must be rated for high wind resistance due to frequent coastal weather events
Solar Battery Bank: Adding a solar battery increases upfront cost but enhances reliability during grid outages. Lithium-ion models are most common, though new hybrid designs are entering the Rhode Island market

Solar Soft Costs

Soft costs represent the services and behind-the-scenes work that ensure safety and compliance:

Labor: Installer labor typically accounts for 10% to 15% of overall system cost. Complex roof structures or older homes may require additional preparation
Permitting and Inspection: Local permits and utility interconnection fees add 2% to 4% to project cost, depending on the municipality
Design, Administration, and Marketing: These overhead costs represent another 10% to 12%, covering engineering, design, system monitoring setup, and business operations

Collectively, soft costs play a crucial role in determining final pricing, even though they’re often invisible to homeowners.

How Much Do Solar Panels Cost in Rhode Island in 2025?

In 2025, the cost of solar panels in Rhode Island averages $2.75 to $3.10 per watt, slightly above the national average due to higher regional labor and permitting fees. For a 7 kW system, this equates to about $19,000 to $22,000 before incentives.

The cost of solar panels depends on several variables:

Panel Type: Monocrystalline panels provide higher efficiency but cost more. Polycrystalline and bifacial panels may reduce upfront spending while still offering solid output
System Size: Larger systems reduce per-watt costs due to installation efficiencies and bulk equipment discounts
Roof Design: Roofs with multiple pitches or limited south-facing exposure may require specialized mounts, raising the solar panel cost slightly
Installer Experience: Rhode Island’s solar industry is competitive, but seasoned local installers often provide better workmanship and long-term warranties

Because of the state’s strong sunshine in summer months and generous incentive programs, homeowners can still achieve excellent value per dollar spent.

Average Cost of Solar Batteries in Rhode Island

Many homeowners are adding solar batteries to their systems to store daytime energy and reduce dependence on the grid during nighttime or outages. In 2025, solar batteries cost in Rhode Island typically range between $10,000 and $15,000, depending on storage capacity and brand.

Factors Affecting Solar Battery Cost

Storage Capacity: Most Rhode Island homes benefit from 10 – 13 kWh of usable battery storage, enough to power key appliances overnight. Larger properties or homes with electric heating may require 15 – 20 kWh
Battery Chemistry: Lithium-ion batteries dominate the market due to high-energy density and long life spans, though lead-acid batteries remain an option for budget installations
System Configuration: Integrating a solar battery bank during initial installation costs less than retrofitting one later
Warranty and Performance: Premium products such as the Tesla Powerwall 3 or Enphase IQ Battery come with extended warranties and superior cycling performance, slightly increasing the cost of solar batteries

Adding home battery storage not only enhances energy independence but also provides backup power during grid interruptions, valuable during Rhode Island’s winter storms.

How to Lower Solar Cost in Rhode Island

Homeowners in Rhode Island have access to multiple financial incentives that significantly reduce the total solar cost of installation.

Federal Investment Tax Credit (ITC)

The 30% federal ITC remains available through 2025, allowing homeowners to deduct 30% of total installation costs, including panels, inverters, and solar batteries, from their federal tax liability.

Rhode Island Renewable Energy Fund (REF)

Managed by the Rhode Island Office of Energy Resources, the REF provides upfront grants for qualifying residential solar projects. Rebates typically range from $1,000 to $5,000, depending on system size and program funding levels.

Renewable Energy Growth (REG) Program

Rhode Island’s REG Program offers long-term, performance-based payments for homeowners who generate solar power and export it to the grid. Participants sign 15- or 20-year agreements with National Grid, receiving fixed payments for each kilowatt-hour produced.

Property and Sales Tax Benefits

Rhode Island exempts renewable energy systems from property tax assessments, ensuring solar additions don’t increase taxable home value. Additionally, there’s no state sales tax on solar energy equipment, which further reduces the solar panel cost.

By combining federal, state, and utility-level incentives, homeowners can lower total project expenses by 35% to 45%, making solar more affordable than ever.

Paying for Solar Installation in Rhode Island

Rhode Island residents can finance their solar installations in several ways, depending on cash flow and ownership preference.

Cash Purchase: Paying upfront maximizes long-term savings, as homeowners own the system outright and qualify for all tax incentives. This option is ideal for residents who plan to stay in their homes for at least 10 years
Solar Loan: Solar loans allow homeowners to spread the solar power cost over several years with manageable monthly payments. Many Rhode Island credit unions offer low-interest “green energy” loans. In most cases, loan payments are lower than pre-solar electric bills
Solar Lease or Power Purchase Agreement (PPA): Leasing allows homeowners to go solar with little or no upfront cost. The installer owns and maintains the system, while the homeowner pays a fixed monthly rate for the electricity produced. Leases are useful for residents seeking predictable savings without dealing with system upkeep

Each option helps reduce energy expenses, but ownership, through cash or loans, offers the best long-term return and property value increase.

How Much Money Can I Save by Going Solar in Rhode Island?

With electricity rates averaging around $0.27 per kilowatt-hour (kWh) in 2025, Rhode Island homeowners stand to gain substantial savings from solar energy. A properly sized 7-kW system can offset 85% to 95% of a home’s annual consumption, resulting in yearly savings of $1,400 to $1,700 on electric bills.

Over a 25-year system lifespan, those savings total $35,000 to $40,000, not accounting for future utility rate hikes. Adding home battery storage can increase these savings further by storing excess generation for nighttime use and minimizing grid purchases.

The average payback period for solar in Rhode Island is between 7 and 9 years, depending on system size, financing method, and energy consumption patterns. Factors influencing solar savings include:

Sunlight Exposure: Homes with south-facing roofs experience higher output and faster payback
Panel Efficiency: High-performance panels generate more electricity in limited roof space
Financing Choice: Cash buyers and low-interest loan holders achieve greater lifetime savings
Incentive Utilization: Combining state rebates, the federal ITC, and REG payments drastically reduces the breakeven time

Given Rhode Island’s strong incentive framework and high grid rates, investing in solar now can lock in decades of lower energy costs and greater energy independence.