2021 Solar Incentives Update
2021 brings some welcome good news for the solar industry and Rhode Island residents. The cost of installing solar and batteries continues to come down. There are also positive updates on both the Rhode Island Renewable Energy Fund Grant and the Solar Federal Investment Tax Credit incentives.
Incentives: Rhode Island Renewable Energy Fund
The Commerce Corporation of Rhode Island has announced that the Renewable Energy Fund will continue to award grants for residential solar installations in 2021. The state will award grants for up to $7,000 for eligible net metering solar installations. This grant represents up-front money that helps reduce the cost of installing solar for Rhode Island homeowners by up to 25%.
Incentives: Federal Investment Tax Credit
In December 2020, the President signed the omnibus appropriations and COVID-19 relief bills into law. An important component of this law extends the investment tax credit for new solar installations. Beginning in 2006, the investment tax credit was originally designed to promote the accelerated adoption of clean solar energy to qualified residents and tapering off starting in 2021.
With the program’s success and the recognized importance of solar, the new law now extends the solar investment tax credit (ITC) at a full 26% for projects in 2021 and 2022, eventually stepping down to 22% in 2023. The ITC program will retire in 2024.
In addition, the legislation will appropriate money to the Department of Energy (DOE) to continue to improve solar PV energy efficiency and cost-effectiveness, increase manufacturing and recycling of solar panels, and fund programs to integrate solar power into the grid. Energy storage system research will also be funded to improve battery technology as well.
Low Solar Cost
With a strong 43% growth in the solar industry in 2020, this is encouraging news. Solar power production continues to be the lowest cost source of electricity. With the extension of the federal investment tax credit and REF funding, there has never been a better time to go solar in Rhode Island. We hope that 2021 will deliver continued economic recovery for our country and continued growth for the solar industry as we rebuild.
Image Credit: SEIA