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The federal 25D tax credit is dead. With $0 credit for cash and loan buyers, the financing math has changed. But Rhode Island’s REG program ($2,639/yr for 15 years) makes ownership uniquely powerful — if you are the owner. Here are the real 2026 numbers for all 5 financing paths.
8 kW System
~$24,480
Federal ITC
$0
REF Rebate
$5,000
REG Income/yr
$2,639
Federal Residential Solar Tax Credit (Section 25D) Expired December 31, 2025
RI homeowners who purchase solar with cash or a loan receive $0 in federal tax credits. PPA/lease providers can still claim Section 48/48E (30%) through July 4, 2026 because they own the system. Is solar still worth it in RI?
Five ways to go solar in Rhode Island — ranked by 25-year total savings. The critical variable: who owns the system and therefore who collects the $39,585 in REG payments.
Upfront: $19,480 (after REF) · Monthly: $0 · Payback: ~6.6 years
Homeowners with capital who want maximum long-term ROI
Upfront: $0 down · Monthly: $130-200/mo (10-15yr) · Payback: ~9-12 years
Homeowners who want ownership with $0 down
Upfront: $0 · Monthly: Per-kWh rate (10-20% below retail) · Payback: Immediate savings
Homeowners wanting immediate savings with no risk
Upfront: $0 · Monthly: Fixed monthly payment · Payback: Immediate savings
Homeowners wanting predictable monthly costs
Upfront: $0 · Monthly: Subscription fee (offset by bill credits) · Payback: Immediate savings
Renters, condos, shaded roofs, anyone who cannot install
Rhode Island’s REG program pays system owners $0.2723/kWh for every kWh generated — guaranteed for 15 years. On an 8 kW system, that is $2,639/year ($39,585 total) in cash payments. This income goes to whoever owns the system. If you lease or PPA, the third-party company keeps it. Read about the REG program
Based on a typical 8 kW system at $3.06/W ($24,480) in Rhode Island. All numbers reflect post-25D-expiration reality.
| Feature | Cash | Loan | PPA | Lease | Community |
|---|---|---|---|---|---|
| Upfront Cost | $19,480 (net) | $0 | $0 | $0 | $0 |
| Monthly Cost | $0 | $130-200 | Per kWh | Fixed monthly | Credit on bill |
| Federal ITC | $0 (25D dead) | $0 (25D dead) | 30% (Sec 48) | 30% (Sec 48) | Varies |
| You Own System | Yes | Yes | No | No | No |
| REG Income ($2,639/yr) | You keep 100% | You keep 100% | TPO keeps | TPO keeps | N/A |
| REF Rebate ($5K) | You receive | Reduces loan | TPO receives | TPO receives | N/A |
| Net Metering Credits | 80% retail | 80% retail | TPO receives | TPO receives | Bill credits |
| Sales Tax Exempt (7%) | Yes (~$1,714) | Yes (~$1,714) | Built into rate | Built into rate | N/A |
| Property Tax Exempt | Yes (20 years) | Yes (20 years) | Owner claims | Owner claims | N/A |
| 25-Year Savings | $100K+ | $70-80K | $40-50K | $35-45K | $20-25K |
| Payback Period | ~6.6 yr | ~9-12 yr | Immediate | Immediate | Immediate |
| Contract Length | None | 10-15 yr | 20-25 yr | 20-25 yr | Flexible |
| Maintenance | You handle | You handle | Owner handles | Owner handles | None needed |
| Best For | Long-term investors | $0-down ownership | Risk-averse | Predictability | Non-owners |
Data as of February 2026. Based on 8 kW system, $3.06/W avg, RI Energy rate $0.29/kWh, 3% annual rate increase, 0.5% panel degradation, REG at $0.2723/kWh for 15 years, net metering at 80% retail. PPA/lease assume 15% below retail.
Highest long-term savings, highest upfront cost
Net Cost (after REF)
$19,480
$24,480 gross minus $5,000 REF
Payback Period
~6.6 years
Via REG + net metering + tax savings
25-Year Savings
$100,000+
Net of system cost
You pay the full system cost upfront and own the panels, inverter, and all equipment. With Section 25D expired, there is no federal tax credit to offset your cost. But Rhode Island’s stacked incentives make the payback among the fastest in the country:
System cost (avg):
$24,480
REF rebate:
-$5,000
Sales tax saved:
-$1,714
Effective cost:
$17,766
REG income/yr:
+$2,639
Net metering value/yr:
+$2,567
Property tax savings/yr:
+$362
Total annual benefit:
~$5,568/yr
Simple payback:
~3.1 years (REG stacked)
Note: REG and net metering stack. You receive REG for production AND net metering for consumption offset. Payback shown above uses the combined stacked income. Without REG, payback is ~6.6 years on net metering + tax savings alone.
$0 down ownership through local lenders
Upfront Cost
$0 Down
$19,480 financed (after REF)
Typical APR
6–8%
10 to 20 year terms
25-Year Savings
$70,000–$80,000
Net of loan payments
| Loan Term | APR | Monthly Payment |
|---|---|---|
| 10 years | 6.0% | ~$175 |
| 12 years | 6.5% | ~$157 |
| 15 years | 7.0% | ~$143 |
| 15 years | 8.0% | ~$152 |
| 20 years | 7.5% | ~$129 |
Based on $19,480 financed (after $5,000 REF rebate). Monthly payments include principal and interest. Rates from typical RI credit unions and national solar lenders. Home equity loans may offer lower rates.
Loan payment:
-$143/mo
REG income:
+$220/mo
Net metering savings:
+$214/mo
Monthly net gain:
+$291/mo (cash-flow positive)
This is the power of RI’s REG program: even with a loan, you can be cash-flow positive from month one. REG payments ($220/mo) alone exceed the 15-year loan payment ($143/mo).
$0 upfront, third-party owns the system
Upfront Cost
$0
No money out of pocket
Your Rate
$0.23–$0.26/kWh
10-20% below RI Energy rate
25-Year Savings
$40,000–$50,000
Vs. RI Energy rates
A third-party company installs, owns, and maintains solar panels on your roof. You buy the electricity they produce at a fixed per-kWh rate, typically 10-20% below your RI Energy rate. The company keeps all ownership benefits:
RI Energy retail rate:
$0.29/kWh
Typical PPA rate:
$0.23-$0.26/kWh
Your savings per kWh:
$0.03-$0.06/kWh
Annual savings (8 kW):
~$290-$580/yr
Escalator:
1-3%/year (typical)
PPA companies must begin construction before July 4, 2026 to claim the 30% commercial ITC under Section 48/48E. After this deadline, the third-party tax advantage disappears and PPA rates will likely increase. If you are considering a PPA, acting before mid-2026 locks in the lower rate.
Fixed monthly payment, third-party owns the system
Upfront Cost
$0
No money out of pocket
Monthly Payment
Fixed
Typically lower than current bill
25-Year Savings
$35,000–$45,000
Vs. RI Energy rates
A solar lease is similar to a PPA, but instead of paying per kWh, you pay a fixed monthly amount regardless of production. The trade-offs are nearly identical to a PPA:
With a PPA or lease, you have three options: (1) transfer the contract to the buyer (most common, requires buyer qualification), (2) buy out the remaining contract at a pre-set price, or (3) have the system removed (usually at your cost). Most buyers will assume the contract since it provides immediate electricity savings.
No equipment, no installation, bill credits
Upfront Cost
$0
No equipment needed
Bill Savings
10–15%
Off your RI Energy bill
25-Year Savings
$20,000–$25,000
No risk, no commitment
Community Remote Net Metering (CRNM) lets you subscribe to a share of a local solar farm without installing anything on your property. You receive virtual net metering credits on your RI Energy bill.
The death of Section 25D created an asymmetry that benefits third-party ownership models.
Pre-2026 (25D Active)
Cash net cost:
$11,576
Federal ITC (30%):
-$7,104
Ownership advantage:
Massive
2026 (25D Expired)
Cash net cost:
$19,480
Federal ITC:
$0
Ownership advantage:
Still strong (REG)
In most states, the loss of 25D makes PPA/lease nearly equivalent to ownership. But in Rhode Island, the REG program keeps ownership significantly ahead because $39,585 in guaranteed payments over 15 years goes to whoever owns the system.
REG payments go to the system owner — not the property owner. This single fact should drive your financing decision.
Annual REG Payment
$2,639
$0.2723/kWh on 9,704 kWh
Monthly REG Payment
$220
Cash deposited to owner
15-Year Total
$39,585
Guaranteed, fixed rate
As the system owner, REG payments are deposited directly to you every month. On a 15-year loan at 7% APR, your $220/mo REG income exceeds your $143/mo loan payment. You are literally making money from day one.
15yr REG: $39,585
15yr loan payments: $25,740
REG covers 154% of loan cost
The third-party company owns the system, so they collect the REG payments. They factor this income into their business model, which allows them to offer you a lower per-kWh rate. But you never see the $39,585 directly.
Your REG income: $0
TPO’s REG income: $39,585
Savings passed as lower rate
This is why Rhode Island is one of the best states for solar ownership despite the loss of 25D. The REG program effectively replaces much of the value the tax credit provided. For a deeper analysis of the program: Complete REG program guide
Follow this decision tree to find the best match for your situation.
No
Community Solar (CRNM) is your best option. No installation needed, 10-15% bill savings, easy to join or leave.
Yes
Next question: Can you afford $19,480-$20,600 upfront (after REF rebate)?
Yes
Cash Purchase gives you the best 25-year return ($100K+). You keep 100% of REG payments ($2,639/yr) and both RI tax exemptions.
No
Next question: Do you want to own the system?
Yes
Solar Loan lets you own with $0 down. 6-8% APR through local lenders. You keep REG payments and property/sales tax benefits.
No
Next question: Do you prefer predictable monthly payments or a per-kWh rate?
Fixed Monthly
Solar Lease gives you a fixed monthly payment. Simple, predictable, third-party handles maintenance.
Per-kWh Rate
PPA charges per kWh generated (10-20% below retail at $0.29/kWh). Third-party claims Section 48 ITC and keeps REG income.
Have $18-21K to invest?
Cash purchase. ~6.6-year payback, $100K+ lifetime savings, keep all REG payments.
Want to own but cannot pay upfront?
Solar loan. REG payments ($220/mo) may exceed loan payments ($143/mo at 15yr/7%). Cash-flow positive from day one.
Want zero risk and zero commitment?
PPA or lease. Third-party claims Section 48 ITC and handles everything. Lower total savings but zero financial exposure.
Renter or cannot install?
Community solar (CRNM). 10-15% bill savings, no installation, no credit check.
RI Solar Guide 2026
Complete overview of solar in Rhode Island
RI Solar Panel Cost 2026
Real pricing data by city and system size
REG Program Guide 2026
$0.2723/kWh for 15 years — how it works
REF Rebate Guide 2026
$0.65/W rebate (up to $5,000) details
Solar Without the Tax Credit
Is solar worth it in RI after 25D expired?
Community Solar (CRNM)
Solar for renters and non-owners
Common questions about solar financing in Rhode Island.
No. The residential solar tax credit (Section 25D) expired December 31, 2025 under the OBBBA signed July 4, 2025. If you buy solar with cash or a loan, you receive $0 in federal tax credits. However, PPA and lease providers can still claim the 30% commercial ITC (Section 48/48E) through July 4, 2026 because they own the system. This Section 48 advantage is passed to you as a lower electricity rate.
REG (Renewable Energy Growth) payments go to the system OWNER. If you buy with cash or a loan, you own the system and keep 100% of REG payments — approximately $2,639 per year for 15 years ($39,585 total) on an 8 kW system. If you choose a PPA or lease, the third-party owner keeps the REG income. This is the single biggest financial difference between owning and leasing in Rhode Island.
It depends on your priorities. Cash purchase offers the highest 25-year ROI ($100K+) with a ~6.6-year payback because you keep REG, net metering, and both tax exemptions. A solar loan provides $0 down ownership at 6-8% APR while still keeping REG income. PPA and lease are increasingly competitive because the third-party owner claims Section 48 ITC (30%) and passes savings to you as a lower rate. Community solar (CRNM) is best for renters or those who cannot install.
The REF (Renewable Energy Fund) rebate is $0.65/W capped at $5,000. For cash purchases, the rebate is paid directly to you, reducing your net cost from ~$24,480 to ~$19,480 for an 8 kW system. For loans, the rebate reduces the amount you finance. For PPA and lease, the third-party owner typically receives the rebate and factors it into your rate. You must apply during an open grant round through Commerce RI before installation begins.
Standard solar loan rates in Rhode Island range from 6-8% APR in 2026, offered through local credit unions, national solar lenders, and home equity products. Terms typically range from 10-20 years. Unlike Connecticut, Rhode Island does not have a state-backed green bank loan program with subsidized rates. The REF rebate reduces your financed amount, and monthly REG payments help offset loan costs.
Yes. Rhode Island offers community solar through the Community Remote Net Metering (CRNM) program. You subscribe to a share of a local solar farm and receive 10-15% savings on your RI Energy bill. No rooftop installation needed. Ideal for renters, condo owners, and homes with shaded roofs. No credit check required for most programs. A CRNM v2 program (40 MW additional cap) is currently under development.
Get a personalized financing comparison for your Rhode Island home. We will show you real numbers for cash, loan, PPA, and lease — including your REG income potential.
Free, no-obligation analysis. Compare all financing options side by side with your actual roof and energy usage.