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The federal residential tax credit is gone, but Connecticut still offers some of the strongest state-level solar incentives in the Northeast. Here is every program, exemption, and financing option available to CT homeowners right now.
100%
Sales Tax Exemption
$0.27/kWh
Avg Electric Rate
6.99%
Smart-E Solar APR
8-10 yrs
Avg Payback
Connecticut homeowners no longer receive a federal solar tax credit (Section 25D expired Dec 31, 2025). However, CT still offers 100% sales tax exemption on solar equipment (6.35%, saving ~$2,082 on an 11 kW system), permanent property tax exclusion, RRES netting at full retail rate ($0.27-$0.29/kWh), ESS battery incentives ($250-600/kWh), and Smart-E Loans at 6.99-7.99% APR for solar through the CT Green Bank (the 0.99% rate is for heat pumps only). For a typical 11 kW system at $2.98/W ($32,780), these incentives combine to deliver an 8-10 year payback with strong 25-year returns.
A quick visual overview of every Connecticut solar incentive — what is active, what has a deadline, and what is gone.
6.99-7.99% APR
CT Green Bank financing for solar. 6.99-7.99% APR (the 0.99% rate is for heat pumps only). Up to $50K, terms 5-15 years.
$0 down, up to $50K
$0.27-$0.28/kWh
Full retail credit for excess solar. Credits roll over 12 months.
~$2,430-$2,660/yr
100% exempt
Solar value is permanently excluded from property tax assessment. CT avg effective rate ~2.04%.
~$669/yr permanently
6.35% saved
Solar equipment 100% exempt from CT sales and use tax. Automatic at point of sale.
~$1,773 on a 9 kW system
30%+ ITC
Third-party system owners (lease/PPA companies) claim 30% commercial ITC.
Lower PPA/lease rate
$0
Expired December 31, 2025. No federal credit for homeowner cash or loan purchases.
$0
Residential Solar Investment Program fully subscribed and closed. No new applications.
The expiration of the federal residential solar tax credit (Section 25D) on December 31, 2025 was a significant blow to homeowners nationwide. For Connecticut residents, this means there is no longer a 30% federal credit to offset the cost of a cash or loan solar purchase. On a $27,900 system, that is $8,370 gone.
But here is the reality that most solar guides miss: Connecticut was never primarily dependent on the federal ITC for its solar economics. The state has built a robust incentive ecosystem through the CT Green Bank (the nation's first green bank), generous tax exemptions, full-retail net metering, and some of the highest electricity rates in the nation.
The math is straightforward: CT electricity costs $0.27-$0.28/kWh. The national average is about $0.16/kWh. Every kilowatt-hour your solar panels produce offsets electricity that costs nearly double the national average. That rate differential is the engine that drives CT solar economics — and it has nothing to do with federal policy.
Any solar company telling you the "30% federal tax credit is still available" for homeowner-owned systems is either uninformed or deliberately misleading you. Section 25D expired on December 31, 2025. If a solar salesperson claims otherwise, walk away.
Exception: Section 48/48E commercial credits are still available for third-party system owners (solar lease and PPA companies) on projects beginning construction before July 4, 2026. The homeowner does not claim this credit directly — the financing company does, and passes savings through as a lower rate.
CT electricity rates ($0.27-$0.28/kWh) are 70% above the national average. Every kWh your panels produce offsets expensive grid power. A 9 kW system saves ~$2,430-$2,660/year.
CT law guarantees RRES netting at full retail rate, permanently protects solar from property tax increases, and exempts solar equipment from 6.35% sales tax. These are codified in statute.
Smart-E Loans for solar offer 6.99-7.99% APR with $0 down and up to $50K. Lower than typical home improvement loan rates (8.5-12% APR), with up to 25% for non-energy improvements like roof repairs.
Smart-E Loan rates for solar are 6.99-7.99% APR. The widely advertised 0.99% APR rate applies only to heat pumps, not solar installations. If a solar company quotes you 0.99% APR, that is a red flag.
The Smart-E Loan is offered through the CT Green Bank and a network of local credit unions and community banks. It provides competitive financing for solar, battery storage, heat pumps, and other energy improvements with $0 down and up to 25% of the loan available for non-energy improvements like roof repairs.
6.99%
APR (solar, 5-10yr)
$50K
Maximum loan amount
15 yr
Maximum solar term
$0
Prepayment penalties
Monthly Payment Example
11 kW system at $2.98/W = $32,780 gross cost. After sales tax exemption savings ($2,082), your financed amount is ~$30,698. At 6.99% APR for 15 years, your monthly payment is approximately $276/month. Compare that to the average CT electric bill of $210-$260/month. While the loan payment may be similar to your current bill, after the loan is paid off in year 15, your panels continue producing free electricity for another 10+ years.
The difference between Smart-E at 6.99% APR and a higher-rate solar loan adds up over a 15-year term:
| Feature | Smart-E Loan | Regular Solar Loan |
|---|---|---|
| Interest Rate | 6.99% APR (solar) | 8.5-12% APR |
| Loan Amount ($32,780) | $32,780 | $32,780 |
| Term | 15 years | 15 years |
| Monthly Payment | ~$295 | ~$353-$420 |
| Total Interest Paid | ~$20,320 | ~$30,600-$42,800 |
| Total Cost of Loan | ~$53,100 | ~$63,380-$75,580 |
| Interest Savings vs Regular | $10,280-$22,480 | — |
Connecticut offers virtual net metering at the full retail electricity rate — one of the most generous net metering policies in the Northeast. This is the single most important financial mechanism for residential solar in CT now that the federal ITC is gone.
$0.27/kWh
Net metering credit rate
For a 9 kW system producing ~10,800 kWh/yr, typical homeowner offsets 80-90%, saving ~$2,430/yr.
$0.28/kWh
Net metering credit rate
Same 9 kW system = ~$2,660/yr in bill savings. Slightly higher rate, slightly faster payback.
Before your solar system can feed power to the grid, your utility must approve interconnection:
Application
Day 1
Installer submits interconnection application
Review
2-4 weeks
Utility reviews system specs
Installation
1-3 days
System installed and inspected
PTO
2-4 weeks
Permission to operate granted
Total timeline: 4-8 weeks from application to PTO. NuWatt handles all paperwork.
Under CGS §12-81(56), Connecticut exempts solar energy systems from local property tax assessments for 15 years. Your solar panels will not increase your property taxes during that period, even though they typically increase your home's market value by $15,000-$25,000.
National research shows solar panels add approximately $15,000-$25,000 to home resale value. In CT, where electricity is expensive, the premium tends to be on the higher end. Without the exemption, that added value would be taxed — but with CGS §12-81(56), you pay $0 extra in property taxes for 15 years.
At CT's average mill rate (~32 mills), a $20,000 value increase would cost approximately $640/year in additional property taxes. Over the 15-year exemption period, you save approximately $8,750 (accounting for modest mill rate increases).
Calculation: $20,000 assessed value × 32 mills = $640/yr × 15 years = ~$8,750
Connecticut exempts solar energy systems from the state's 6.35% sales and use tax under CGS §12-412(117). This applies to all solar photovoltaic equipment, including panels, inverters, racking, wiring, and battery storage systems installed alongside solar.
9 kW system at $3.10/W = $27,900 equipment cost. Without the exemption:
$27,900 × 6.35% = $1,773 in sales tax
With the exemption, you pay $0.
The exemption is automatic at point of sale. No paperwork needed from you.
While homeowners can no longer claim a federal tax credit on purchased solar systems, there is a narrow window where leases and PPAs retain a federal advantage.
Deadline: July 4, 2026 — Projects must begin construction before this date
After July 4, 2026, the Section 48/48E commercial ITC will no longer be available for new residential solar projects. Lease/PPA prices will likely increase.
A PPA lets you buy solar electricity at a fixed rate lower than your utility rate:
PPA rates may include annual escalators (1-3%). Even with escalation, most CT homeowners save for the full term.
| Factor | Buy (Smart-E Loan) | Lease/PPA |
|---|---|---|
| Upfront cost | $0 (Smart-E) | $0 |
| Monthly payment | ~$157/mo | ~$100-$140/mo |
| You own system? | Yes | No |
| 25-year savings | $42K-$58K | $15K-$25K |
| Federal credit | None (25D expired) | 48/48E to owner |
| Property value | +$15K-$25K | Minimal/complex |
| Maintenance | Your responsibility | Company handles |
| Contract length | 15-20 yr loan | 20-25 yr agreement |
Connecticut has two major electric utilities. Both offer full retail net metering, but there are meaningful differences.
| Feature | Eversource CT | United Illuminating (UI) |
|---|---|---|
| Coverage | ~72% of CT households | ~28% of CT households |
| Territory | Hartford, New London, Middlesex, Windham, Tolland | Greater Bridgeport & New Haven |
| Avg Rate | $0.27/kWh | $0.28/kWh |
| Net Metering | Full retail rate, 1:1 | Full retail rate, 1:1 |
| Credit Rollover | Monthly, annual true-up | Monthly, annual true-up |
| Battery Program | ConnectedSolutions $225/kW | ConnectedSolutions eligible |
| Avg Monthly Bill | ~$210/month | ~$225/month |
| Annual Solar Savings (9 kW) | ~$2,430 | ~$2,660 |
| Interconnection Timeline | 4-8 weeks | 4-6 weeks |
Not every homeowner can install rooftop solar. If you rent, own a condo, or have a shaded roof, community solar lets you benefit from solar energy without installing anything on your property. Connecticut launched the Shared Clean Energy Facility (SCEF) program in 2019.
Adjust system size, utility, and battery to see exactly how much Connecticut solar incentives are worth for your home. All calculations use verified 2026 RRES program rates.
See exactly how Connecticut solar incentives stack up for your system. Adjust size, utility, and battery to see your personalized numbers.
Federal Solar ITC (Section 25D): EXPIRED
$0 for homeowner cash or loan purchases. Expired December 31, 2025.
Hartford, most of CT (north, east, central)
System Cost
$32,780
Annual Production
12,925 kWh
Electric Rate
$0.29/kWh
Cost per Watt
$2.98/W
Permanent exemption — solar adds $0 to your property tax bill
First-Year Value
$5,980
total
Payback
7.9
years
25-Year Savings
$134,343
lifetime
Estimates based on CT avg pricing ($2.98/W), RRES netting tariff at Eversource CT retail rate ($0.29/kWh), $0.0402/kWh Solar Energy Adjustment for 2026 enrollees, 6.35% sales tax exemption, permanent property tax exemption (~2.04% effective rate), and ESS incentive at $250/kWh standard tier. Section 25D residential ITC expired Dec 31, 2025 — $0 federal tax credit for cash/loan purchases.
Transparency matters. Here are the solar programs and incentives that Connecticut does not currently offer. If a solar company tells you otherwise, that is a red flag.
Section 25D expired December 31, 2025. Homeowners who buy with cash or loan get $0 in federal credits.
The Residential Solar Investment Program was fully subscribed and closed. No upfront state rebate available.
CT does not have a Solar Renewable Energy Credit (SREC) program like NJ or MD. No tradeable solar credits.
Unlike MA (SMART $0.03/kWh) or RI (REG $0.27/kWh), CT does not pay homeowners per kWh produced. Your savings come from offsetting utility purchases.
CT does not offer a state income tax credit for solar, unlike MA which has a 15% credit (max $1,000).
Section 25C (heat pumps, insulation) also expired December 31, 2025. No federal energy efficiency credit available.
Connecticut's solar incentive landscape is thinner than it was in 2024, when homeowners had the 30% federal ITC plus state programs. But CT's remaining advantages — extremely high electricity rates ($0.27-$0.29/kWh), RRES netting at full retail, generous permanent tax exemptions, and ESS battery incentives — still make solar a strong investment. The payback is 8-10 years for cash purchases, and solar panels last 25+ years, meaning you get 15+ years of free electricity after breakeven.
Connecticut holds its own against other Northeast states in 2026.
| State | Avg Rate | Sales Tax | Property Tax | Net Metering | Special Program | Payback |
|---|---|---|---|---|---|---|
| Connecticut | $0.27-$0.28 | 100% exempt | 100% exempt (permanent) | Full retail | Smart-E 6.99-7.99% (solar) | 8-10 years |
| Massachusetts | $0.28-$0.32 | 100% exempt | 100% exempt | ~60% NEM 3.0 | SMART $0.03/kWh | 12-14 years |
| Rhode Island | $0.29 | 100% exempt | 100% exempt (20yr) | 80% retail | REG $0.27/kWh | 13-15 years |
| New Jersey | $0.26 | 100% exempt | 100% exempt | Full retail | ADI $85.90/MWh | 14-16 years |
Connecticut was a solar pioneer, creating the nation's first green bank in 2011.
CT Green Bank created — first green bank in the US
Residential Solar Investment Program (RSIP) launched — up to $0.46/W rebate
RSIP drives CT solar capacity past 200 MW. Rebate steps down.
Smart-E Loan program reaches 0.99% APR. CT Green Bank finances $1B+.
Shared Clean Energy Facilities (SCEF) program starts — community solar in CT
RSIP funding exhausted — program winds down, no new applications
Federal residential ITC (Section 25D) expires December 31.
CT relies on state incentives: tax exemptions, net metering, Smart-E. Deadline: March 31.
Common questions about Connecticut solar incentives in 2026.
No. The federal residential solar tax credit (Section 25D) expired on December 31, 2025. Connecticut homeowners who purchase solar panels with cash or a loan receive $0 in federal tax credits. However, if you go solar through a lease or PPA, the third-party system owner may still claim Section 48/48E credits through July 4, 2026, which can translate to lower pricing for you.
Connecticut offers several strong state incentives: 100% sales tax exemption on solar equipment (6.35%, saving ~$2,082 on an 11 kW system), permanent property tax exclusion, RRES netting tariff at full retail rate ($0.27-$0.29/kWh), ESS battery incentives ($250-600/kWh), and Smart-E Loans through CT Green Bank at 6.99-7.99% APR for solar (the 0.99% rate is for heat pumps only). Income-eligible households may qualify for enhanced ESS incentives.
The average cost of solar in Connecticut is $2.60-$3.10 per watt before incentives. A typical 11 kW system costs approximately $32,780 at $2.98/W. After the sales tax exemption (~$2,082 saved), the effective cost is ~$30,698. With a Smart-E Loan at 6.99% APR over 15 years, monthly payments are around $295. Note: the 0.99% Smart-E rate is for heat pumps only, not solar.
Yes. Connecticut permanently excludes solar installations from property tax assessment. Adding solar does NOT increase your assessed home value for tax purposes, even though solar typically adds $15,000-$25,000 in market value. With CT average effective property tax rate of ~2.04%, this saves approximately $669 per year on an 11 kW system.
Connecticut offers virtual net metering at the full retail electricity rate. Eversource customers earn credits at ~$0.27/kWh and United Illuminating customers earn ~$0.28/kWh. Credits carry forward month-to-month for up to 12 months with an annual true-up. Systems up to 2 MW are eligible.
The Smart-E Loan is a clean energy financing program through the CT Green Bank. For solar, rates are 6.99-7.99% APR with terms from 5 to 15 years (the 0.99% rate applies only to heat pumps, not solar). Loans cover up to $50,000, with up to 25% available for non-energy improvements like roof repairs. You must use a participating contractor, pass a credit check, and the property must be in Connecticut.
No. The RSIP was a rebate program run through CT Green Bank that provided upfront incentives for solar installations. It was fully subscribed and closed. If a solar company promises you an RSIP rebate, that is a red flag.
Both options have merit. Purchasing with a Smart-E Loan (6.99-7.99% APR for solar) gives you full ownership, maximum long-term savings, and the property tax exemption benefit. A lease or PPA offers $0 down because the third-party owner can claim federal Section 48 credits (30%) through July 4, 2026. After that deadline, lease/PPA pricing may increase as the ITC disappears.
Without the federal ITC, the average solar payback period in CT is 8-10 years for a cash purchase. CT has among the highest electricity rates in the nation ($0.27-$0.29/kWh), which means your panels offset expensive grid power. With RRES netting at full retail rate, permanent property and sales tax exemptions, and rising utility costs, most CT homeowners see strong returns over the 25+ year panel lifespan.
Yes, through community solar. Connecticut offers the Shared Clean Energy Facility (SCEF) program, which allows renters, condo owners, and homeowners with shaded roofs to subscribe to a local solar farm. You receive credits on your electric bill — typically 5-20% savings — without installing anything on your property.
CT Energy Hub
All CT solar & heat pump guides
CT Solar Cost 2026
Pricing breakdown by city
Energize CT Guide
All Energize CT programs
Smart-E Loan Guide
Application process & tips
Eversource vs UI Rates
Side-by-side rate comparison
Eversource vs UI Heat Pumps
HP incentive comparison
CT Net Metering Guide
How credits work in 2026
Buy vs Lease vs PPA
Best financing for CT
CT Community Solar
SCEF program details
CT Solar + Battery
ConnectedSolutions & backup
Solar Lease & PPA CT
TPO options in 2026
Section 48 Guide
How commercial ITC helps you
Solar Without the ITC
Is it still worth it in CT?
Community vs Rooftop
Which is right for you?
Income-Eligible Solar
Low-income CT programs
Solar Financing Guide
National financing options
CT Solar Tax Exemptions
Sales & property tax details
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Section 48 lease/PPA deadline: July 4, 2026. Smart-E Loan available at 6.99-7.99% APR for solar.