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Rhode Island homeowners pay an average of $0.29/kWh in 2026 — 61% above the national average. RI Energy (formerly National Grid) rates have surged since 2020, making Rhode Island one of the most expensive states for electricity. Here is exactly what happened, why, and what you can do about it.
Rhode Island Energy serves ~98% of the state. Pascoag and Block Island serve small pockets at different rates. RI Energy rates are among the highest in the continental US.
~500,000 customers
$0.2900
per kWh (Jan 2026)
ConnectedSolutions
$225/kW summer + $50/kW winter
~4,800 customers
$0.2600
per kWh (Jan 2026)
Small municipal-like district in northwestern RI
~1,200 customers
$0.3500
per kWh (Jan 2026)
Island grid connected to mainland via undersea cable (2017), still premium-priced
The PPL acquisition effect
PPL Corporation acquired National Grid's Rhode Island operations for $3.8 billion in 2022, rebranding to "Rhode Island Energy." While PPL has invested in grid reliability and storm hardening, wholesale market forces (ISO-NE capacity costs, natural gas prices) continue to drive rates higher. The PUC required rate stability during the transition period, but that protection has ended and rates are now rising faster.
Rhode Island electricity rates have increased approximately 44% since 2020. RI Energy dominates the market and sets the pace for the state's electricity costs.
| Utility | Jan 2020 | Jan 2021 | Jan 2022 | Jan 2023 | Jan 2024 | Jan 2025 | Jan 2026 | 6-Year Change |
|---|---|---|---|---|---|---|---|---|
| RI Energy | $0.2020 | $0.2190+8.4% | $0.2380+8.7% | $0.2620+10.1% | $0.2850+8.8% | $0.2680-6.0% | $0.2900+8.2% | +43.6% |
| Pascoag | $0.1890 | $0.2010+6.3% | $0.2180+8.5% | $0.2360+8.3% | $0.2550+8.1% | $0.2450-3.9% | $0.2600+6.1% | +37.6% |
| Block Island | $0.2700 | $0.2850+5.6% | $0.3000+5.3% | $0.3200+6.7% | $0.3450+7.8% | $0.3300-4.3% | $0.3500+6.1% | +29.6% |
Pre-pandemic baseline: RI avg ~$0.20/kWh under National Grid. Already high due to small grid size and gas dependence.
Post-COVID demand recovery + natural gas price spike. RI rates rise 8% as ISO-NE wholesale prices climb.
PPL acquires National Grid RI, rebrands to "RI Energy." Russia-Ukraine war drives gas prices up. Rates jump 9%.
PPL transition rate stability period ends. ISO-NE capacity costs increase. Delivery charges rise for grid hardening.
RI Energy rate peaks at $0.285/kWh. PUC approves grid modernization plan. Storm recovery costs from 2023 nor'easter.
Brief rate dip as gas prices moderate. But delivery charges continue climbing. REG program proves its value for solar owners.
RI Energy hits $0.29/kWh. ISO-NE capacity prices locked through 2027. Grid modernization adds ~$0.015/kWh to delivery.
RI's electricity costs are driven by structural factors that are unlikely to change in the near term. Understanding these drivers helps explain why rates will remain elevated — and why solar makes sense now.
Rhode Island generates approximately 90% of its electricity from natural gas — the highest percentage in New England. With virtually no fuel diversity, RI is fully exposed to natural gas price volatility. When gas prices spike (as they did in 2022), RI rates follow immediately and dramatically.
ISO New England's Forward Capacity Auctions set prices 3 years ahead. The 2026-2027 period reflects higher clearing prices from generator retirements. RI's small grid means these costs are spread across fewer ratepayers, resulting in a higher per-kWh impact than in Massachusetts or Connecticut.
Rhode Island is the smallest state with only ~500,000 electric customers. Fixed costs (transmission, distribution, billing, customer service) are divided among fewer ratepayers than in neighboring states. This structural disadvantage means RI will always pay more per kWh than larger states with the same wholesale prices.
Since acquiring National Grid RI, PPL has invested heavily in storm hardening, smart meters, and distribution automation. These investments improve reliability but add approximately $0.015/kWh to delivery charges. The PUC has approved multi-year capital spending plans that will continue driving delivery charges higher.
During winter cold snaps, RI imports up to 60% of its electricity from the ISO-NE grid. Gas-fired generators compete with home heating for the same constrained pipeline capacity, driving wholesale prices to extreme levels. January 2024 saw real-time prices exceed $200/MWh during a cold snap.
RI's Renewable Energy Standard requires utilities to source increasing percentages from renewables. Renewable Energy Certificate (REC) costs, the REG program allocation, and the Act on Climate compliance costs all add approximately $0.01-0.02/kWh to total rates.
$0.088/kWh
Rate increase since 2020 (RI Energy). On a 850 kWh/month home, that is $75/month more than 6 years ago.
$898/yr
Annual cost increase for a typical RI home vs. 2020 rates, purely from rate inflation.
$22,440+
Cumulative extra cost over 25 years if rates stay at current levels vs. 2020 rates. Solar locks in your rate at $0.
Based on RI PUC filings, ISO-NE capacity market results, and PPL's capital spending plans, here is what Rhode Island ratepayers should expect.
Supply rate reset — likely $0.13-0.17/kWh supply. Total rate may dip slightly to ~$0.27-0.28 depending on summer gas prices.
Annual supply reset + delivery charge increase. Total rate projected at $0.30-0.32/kWh. Grid modernization Phase 2 costs begin.
South Fork Wind and Revolution Wind costs begin flowing to RI ratepayers. Net impact: +$0.01-0.015/kWh added to bills.
ISO-NE FCA 18 cleared at higher prices. RI's small customer base means higher per-kWh capacity charge impact than MA or CT.
PUC has approved PPL multi-year rate increases for grid modernization. Delivery charges expected to rise 4-6% annually.
No change to gas dependence (~90%). No new pipeline capacity. RI rates projected to reach $0.33-0.35/kWh by 2028-2029.
Bottom Line on RI Rate Forecasts
Rhode Island's 90% gas dependence, small grid, and ongoing PPL capital investments make rate decreases virtually impossible. Rates are projected to reach $0.33-0.35/kWh by 2029. Solar + REG ($0.27/kWh for 15-20 years) is the most effective way for RI homeowners to protect against rising electricity costs.
Every kWh your solar panels generate avoids the full retail rate. At $0.29/kWh, plus the REG program's $0.27/kWh incentive, RI has one of the best solar value propositions in the country.
| System Size | Annual kWh | Bill Offset | Monthly Savings | Annual Savings | 25-Year Savings | Payback (No ITC) |
|---|---|---|---|---|---|---|
| 7 kW | 8,400 | 85% | $179 | $2,148 | $53,700 | 11.8 years |
| 9 kW | 10,800 | 90% | $243 | $2,916 | $72,900 | 10.5 years |
| 11 kW | 13,200 | 92% | $304 | $3,648 | $91,200 | 9.8 years |
| 14 kW | 16,800 | 95% | $399 | $4,788 | $119,700 | 9.2 years |
Based on $3.10/W system cost (RI average), $0.29/kWh rate, 1,200 kWh/kW annual production, no federal ITC (expired 2025), REG incentive included in payback.
The REG program pays solar owners $0.27/kWh for every kWh generated, guaranteed for 15-20 years. This is separate from net metering bill credits. Combined with $0.29/kWh bill savings, RI solar owners effectively earn $0.56/kWh in total value — the highest combined rate in New England. This is why RI solar payback is under 10 years even without the federal ITC.
ConnectedSolutions pays RI Energy customers $225/kW for summer peak demand reduction plus $50/kW for winter events. A Tesla Powerwall 3 (5 kW) earns $1,375/year. Combined with solar bill savings and REG income, a solar + battery system in RI generates three separate income/savings streams — making it one of the best energy investments in the country.
$0.29/kWh
Current RI Rate
Every kWh your solar generates is worth $0.29 in avoided electricity costs. Six years ago, it was worth only $0.20.
9-10 yrs
Payback Period
Even without the federal ITC (expired 2025), RI's high rates, REG program, and REF rebate bring payback under 10 years for most homes.
$90K+
25-Year Value
An 11 kW system earns $90,000+ over its lifetime from bill savings + REG income. If rates rise 3%/year, total value exceeds $110,000.
For an 11 kW system producing 13,200 kWh/year:
Rate increase scenarios (25-year impact):
Every month you wait, you pay another $250-400 in electricity costs that solar could eliminate. With the REG program paying $0.27/kWh, RI solar payback is under 10 years.
No sales calls. Instant online estimate. See your exact savings at current RI rates.