New York Solar Incentives: Solar Property Tax Exemption (Credits Rebate)

The extremely high electricity rates in the state make moving to solar powered electricity a great deal, and thanks to New York solar incentives, the move might be much less expensive that you think.

It is for this and several other reasons that New York is slowly but surely etching its place as a solar power hotspot. To aid in these efforts, the state government has been at the forefront, providing attractive New York solar incentives.

While practically all the states have some sort of solar energy support program, those in New York tend to stand out more, given how ambitious they are.

This guide provides all the information about New York solar incentives, and explains how to use them to lower the cost of solar panels in New York.

Solar Power in New York: Renewable Energy Consumption

Is it shocking to find out that there is solar power in New York and that the solar market is actually booming? Well, it is understandable because the state is not very sunny, but also, don’t forget about the extremely high utility rates.

It is always in the top ten of the places with the most expensive power bills.

The residents know this all too well, and it is shocking that they pay 48% more than the national average.⁵ It is probably for this reason alone that New Yorkers are turning to solar power, at least to save themselves from paying the high bills.

You should know that New York comes in at number 11 when it comes to the best states for solar, meaning that it is a pretty great place to own panels.

In addition to that, the cost of solar panels in New York has dropped by at least 11%.

Apart from that, you will appreciate the fact that the state offers some of the most attractive New York solar incentives, which have worked over the years to entice more people to switch to renewable energy.

To guarantee this, the states also signed a strong Renewable Portfolio Standard (RPS) requiring 50% of power from utilities to come from renewable sources, that is by 2030.

New York Solar Farms

There are also so many notable solar farms New York that play a massive role in the state’s adoption of solar power.

Take, for instance, the Shoreham Solar Commons established in 2018, a massive 32 MW solar farm project that has the potential to power more than 5,800 homes.

The Branscomb Solar project that came to be in 2021 is another huge installation, 27 MW in capacity which will be able to serve almost 5,000 residential buildings.

There are several more solar companies distributed all around the country, serving both residential and commercial buildings in New York.

These multi-million projects only go to show how serious solar power in New York is and why it is one of the fastest climbers in terms of solar ranking.⁹

How Much Are Solar Panels in New York? Cost of Solar Panels in New York

Are you thinking about converting to solar power for good? Your very first question will likely be, what is the cost of solar panels in New York?

Remember that this is a massive home renovation, as such, you should know that you will have to dig a little deep into your pockets. But not to worry, the cost is not exaggerated as in other places, and the best part is that there are solar rebates from the government to make the price more manageable.

So what are the numbers? Buying solar panels in New York will set you back around $19,170.⁷

This should be the total cost assuming a few factors. For one, this takes into account that your system is about 6.5 watts and that you don’t have backing by any of New York’s solar incentives, therefore, you should expect it to cost less than that by at least five digits.

To get a better perspective, compare that to the national average. In general, the cost of solar panel installation in the US costs $2.66 for each and every watt.

On the other hand, if you live in New York, the installation will run you $2.95 for each wattage installed. It is self-explanatory that the rate is slightly more expensive for New Yorkers, thankfully not by much.

There is a pretty good chance that you will spend way less than the average cost, especially if you play your cards right and have a few tricks up your sleeve. No matter how much money you use for the project, the best part about it is that it is always an investment.

The savings you make instead of paying the high energy bills not only assure that you will get your money back, but you will have even more left over.

How Does the Solar Panel Cost Calculator New York Work?

As a cautious “investor,” you want to make sure that you are getting the right price out of your project. If you are a first-timer and are not exactly sure of where to start, a cost calculator is what you need.

Not just because it is readily available and convenient but because it works efficiently to give you a pretty close estimate of what to expect.

The calculator is software that you can bump into online. Each one you find is created using a specific algorithm that guides you to help it find the answers you need.

Depending on the particular one in question, you may run into questions like your total roof space, your monthly electricity or wattage use, your current location, and a few more prompts.

If your details are accurate, you will be very close to getting an accurate estimate. There are also solar payback calculators online,¹⁰ and you can use the outcome to help you with budgeting and making projections.

This info is your bargaining power, and you won’t even have to leave your house to know how much the system is supposed to cost.

Factors Affecting the Cost of Solar Panels in NY

Before you start asking why are solar panels so expensive, you may want to know that there are several factors that contribute to the price tag. It doesn’t have to cost you a fortune.

Take a look at the factors that can influence the cost of solar panels in New York.

#1 The Energy Needs

New Yorkers spend quite a lot on their energy bills, they have to cool down in the sweltering summers and heat up when it is freezing. Obviously, their energy needs can get quite high, which unfortunately affects the cost of panel installation.

What is the connection? Well, the more your energy requirements, the larger your system will get.

This means that you will have to go for more panels and get a generally large setup that will cost more than a simple installation. But wait, if you have high energy needs and switch to solar power, you can imagine how much you will save instead of paying utility bills, especially with the high energy rates in New York.

#2 The Type of Equipment

Everyone wants a high-performance product. Companies know this and pay more attention to the panels and the accompanying equipment, which makes them more expensive.

Therefore, if you are sure that you want only the most durable and efficient equipment, you better brace yourself when it comes to the cost.

This applies to everything, from the panels, inverters, batteries, and virtually anything else. For instance, using monocrystalline panels instead of thin-film ones will increase the cost of the project.

But still, remember that cheap can be expensive in the long run.

#3 The Type of Roof

Not many first-timers know this, but the current state of your roof and how it looks largely determines how much the installation will cost. For starters, what is its orientation?

If it has a great angle that can capture and harness the sun’s rays, you won’t have to pay more for scaffoldings and the tilting of the panels.

In the same light, if your roof is aged and maybe requires repairs in the next few years, you might want to make the replacements before installing panels. And what does this mean?

That the entire project will cost you more money.

Again, if your roof is not fit or big enough to hold the heavy panels for the over 20 years that they are supposed to be there, your installer will suggest ground mounting. It basically involves buying more equipment and paying extra to have the panels set up on the ground, not the roof.

New York Solar Incentives You Should Know

New York is one of the lucky states in the country with a very strong Renewable Portfolio Standard,¹¹ and in addition to that, it also boasts of receiving heavy backing from the federal and state government.

As a result, prospective solar owners don’t have to worry too much about the cost, and some actually end up paying very little to no money for their projects.

The following are the New York solar incentives that you should be making full use of.

Federal Solar Investment Tax Credit (ITC)

The first on the list has got to be the Federal Solar Tax Credit or the Residential Clean Energy Credit. You must have heard it by now and should know why it deserves all the praise it gets all over the country.

For one, it is not exclusive to New York, it is present in all 50 states and is an incentive at the top of the list for virtually everyone contemplating installing panels in the country.⁴

If you are a New Yorker with property in the region, you are entitled to a 30% tax credit on your solar panel installation cost. Basically, you will get 30% of the money back after installing solar panels.

Seems like a great deal? That’s because it is.

No other incentive in the country is able to offset that much money just because you have converted to solar power.

Given that the average installation cost in New York comes to roughly $19,170, it implies that the 30% tax credit is supposed to be anything around $5,700. This amount will be deducted from the taxes that you owe in that year.

If you are looking forward to this solar tax credit, you might want to get on it now, when it is still at 30% otherwise, the rate is expected to drop to 26% after 2033 and completely disappear after 2035.

New York State Solar Tax Credit: New York State Solar Energy System Equipment Tax Credit

If you are a New Yorker, you must be proud of your state for this one. Imagine being in one of the few places in the country that offers a tax credit of 25% or $5,000 (whatever is lower) on your new solar system installation.

While the ITC stands at 30% and the NY state credit at 25%, now think about having both, having more than half of your installation cost slashed, too enticing. It works practically the same as the federal solar tax credit above, crediting the amount to the amount of taxes that you owe.

However, there is a single difference, the fact that the statewide solar credit is also effective on systems acquired via solar leases or PPAs.

This is welcome news for you as a prospective solar panel owner because it isn’t very strict with ownership like the federal ITC is. Now, if you are looking for maximum savings, consider applying for both tax credits because they can work together.

NY-Sun Megawatt Block

Just when you thought that New York had about done enough for its people, you realize that it has gone a step further to provide the Megawatt Block program under the NY-Sun Initiative.¹²

What’s exciting about this incentive is that it is a dollar-per-watt cash-back plan for all solar power users, whether it is a residential or commercial setup.

Here, you are able to receive anything between $0.15- $0.30 for each and every watt you install, provided that you are a qualified client. Normally, the rate varies based on where you currently live.

For example, Con Edison clients receive $0.20 for every watt as those in Upstate New York get more, $0.30 a watt.

Unfortunately, the PSEG or Long Island customers are cut off from the program right now because all the blocks are filled up.⁶

Given that this is on a per-watt basis, it is clear to see that the bigger your system, the more cash back you can expect; however, you will realize that the total amount can be anything between $1,900- $3,000.

Solar Property Tax Exemption New York

This New York solar incentive is pretty straightforward, it prevents your property taxes from going up after installing solar panels.

What is the connection? You may ask.

As you know, your property taxes basically depend on your home’s value; the more valuable your house is, the higher your taxes go.

It has everything to do with the panels because installing them is kind of like undertaking a home renovation because your property’s value increases. Therefore, the tax evaluator is supposed to base your taxes on its now new high value, but not necessarily, thanks to the tax exemption.

It doesn’t matter how much your home’s value increases, and the panels will not influence an increase in your tax rate; you will still pay the same amount you did before you even installed the panels.

The average New York homeowner will eventually save about $300 every year, that is if your installation costs the state’s average of $19,170 and the tax rate is 1.62%.

Say you save the money for around 15 years of your panels’ service; that brings the total savings to about $4,600. And you don’t even have to do anything for that because it is automatic, unlike other New York solar incentives that you have to apply for.

Sales Tax Exemption

Another solar incentive that you can enjoy as a New Yorker is the waiver on all sales taxes that are usually levied on solar equipment. The government understands just how important it is to acquire the system and as such, doesn’t want to make it any harder for residents to buy them.

So, the state doesn’t charge any sales taxes on the panels, inverters, and other PV systems and makes them cheaper.²

You don’t have to do anything on your part to get this incentive because it is automatic, just like the property tax exemption. This incentive, in effect, saves you up to $700, money that you would have had to pay for when buying your PV equipment.

NYSERDA Residential Financing

NYSERDA seems to be working extra hard in the region to provide solar incentives.¹³

Apart from the block initiative, it is also championing solar financing directly to the people.

Through this incentive, you are able to receive anything between $1,500 – $25,000, money that is dedicated to the installation of solar systems.

The excellent aspect of this program is that it makes solar power more easily accessible for all while keeping the interest rates low. If you do decide to apply for this incentive, the goal is to maintain a low-interest rate.

That way, the overall cost of solar panels will stay relatively low.

This financing option is pretty easy to apply for and takes like only a few minutes.

You first go to NYSERDA’s official website and find a program that speaks more to you then select it. Next, complete the process then wait for the administrator to approve and help you with the rest of the entire process.

Net Energy Metering New York

As stated earlier, New York brags about being one of the states with the toughest RPS goals, and what better way to achieve this than by having net energy metering policies that match? NEM is quite a popular program that you will find in most states, especially those that are very serious about achieving their renewable energy goals.

First things first, what is net metering about? This system allows you to get paid for offering your solar power to utility companies.

You receive compensation in terms of credits as long as you send your excess power to the grid. It is like a payment because the credits help lower or offset your utility bills.

Needless to say, it is a huge win for you because you also get to access traditional grid electricity when your solar system is down or not working.

NEM New York serves all residential PV systems that are up to 25 kW in capacity, and since most homes have at least a 6.5 kW system, it means that virtually all New Yorkers are eligible for the program.

There is more good news about net metering in New York, the retail rate for your credit rate is one of the best that the market has to offer. What’s more, if by any chance you have unused credits, you can always have them roll over for the next 20 years.

How Does the Federal Solar Tax Credit Reduce the Cost of Solar Panels in New York?

You have heard that the federal energy credits is one of the most highly sort-after New York solar incentives, followed closely by the statewide solar tax credit. The two are both huge non-refundable tax credits that have come a long way to improve the solar market in the region.

The ITC now stands at 30%, which is a lot of money if you consider how high the cost of solar panels in New York can go.

There is only one problem, though; many residents don’t understand how it all works. It is pretty simple, really.

Basically, it reduces the amount of solar taxes that you owe by 30% of your panel installation cost.

You have to apply online through the IRS website next time you file your taxes. But how does IRS verify solar credit?

You have to apply for the credit through the IRS Form 5695 at the same time that you file your taxes,¹⁴ this enables the IRS to verify and award you the solar incentive.

No. It is not a cash-back program that will send you a check.

It reduces the amount of money that you owe the government in terms of taxes, and if you are wondering how does the solar tax credit work if I don’t owe taxes, it doesn’t.

Without a tax liability, where will the money be deducted from? You must be owing the government something for them to deduct the credit from.

Therefore, this means that the system only works for tax-paying US citizens. This tax credit system has been in effect since its creation in 2005 as part of the Energy Policy Act and was actually supposed to expire in the year 2007 until it was extended.³

How Do Solar Rebate New York Reduce the Cost of Solar Panels in New York?

Each solar rebate program is specially designed to help reduce the cost of solar panels in New York. For instance, the federal and state solar tax credits reduce your tax liability, while the NY-Sunblock is a cashback program.

On the other hand, NYSERDA offers financing programs while net energy metering reduces your utility bills.

NY Solar Tax Credit Explained

The New York solar tax credit is officially known as the New York State Solar Energy System Equipment Tax Credit. It is one of the best incentives in the state and probably in the country because very few local governments offer such programs.

This credit is valued at 25% of your total installation cost or gives you $5,000, whichever is less.

It works almost exactly the same as the federal solar tax credit because it is non-refundable and applies to your tax liability.

Therefore, it goes without saying that you can only access it if you owe the government some money or have a tax burden. Otherwise, it is closed to non-tax paying citizens.

The best part?

You can use it even alongside the federal solar tax credit. So, instead of saving only 25%, you can actually pocket a whole 55%, more than half of what you used for the installation.

It is incentives like this that make New York an excellent place to install solar power. It explains why the solar market is booming at the moment and is only likely to get better.

Which New York Solar Incentives Are the Best?

You have to acknowledge the fact that New York has some of the best incentives out there. While others only have a few, you, as a New Yorker, have so many options, so many that you have the choice to apply for some and leave out others.

Are you wondering which ones are more lucrative to apply for first, to help you save more money?

Well, obviously, the Federal Solar Tax Credit should be at the top of your list. With a 30% tax credit and more than $5,000 in terms of savings, it’s no wonder residents turn to this before anything else.

Besides, it is amazing how it is easy and fast to apply for. Following closely in the ITC’s footsteps is the New York State Tax Credit.¹⁵

It is rare for a state to offer this for its residents, and if you have the opportunity to slash 25% extra from your installation. Who wouldn’t take the shot?

When you combine it with the ITC and save 55%, that means that your project may cost almost $10,000 less, a once-in-a-lifetime opportunity. Just a little bit of paperwork, and it will be a breeze.

The last two incentives that you can’t afford to miss out on are the NY-Sun Block and Net Energy Metering (NEM). The former has the advantage of being a cash back, an upfront payment rebate program based on your system’s wattage.

Lastly, the NEM New York is one of the best ways to reduce your solar panels’ payback period, and the best part is that your utility provider handles the donkey work for you.

Commercial Solar Panel Grants in New York (REAP)

The United States Department of Agriculture is known for providing grants to businesses and you can also take advantage of that as a New Yorker. This is only made possible by the Rural Energy for America Program or REAP, which targets the agricultural sectors and small rural businesses.

Therefore, if you are a business owner, especially in the rural sector, you can make full use of the grants.

Not only does it lower the cost of solar panels, but it also helps significantly reduce the cost of your utility bills, which can be high considering the nature of activities and the rate of energy in New York.

The only condition to be able to apply for the REAP incentive is that you must be in agriculture, and at least half of your income should come from agriculture.¹

How To Get Free Solar Panels New York

It is clear to see that solar panels can be quite pricey, and it is allowed to ask, How to get solar panels for free? You will save a fortune on your total installation, and everybody would want that.

But does it seem too good to be true? That’s because it is, unless you are talking about using the available New York solar incentives to reduce the costs as much as possible.

The closest you will get to free solar panels in New York is maybe if you are talking about solar leasing/PPAs (Power Purchase Agreements) that allow you to receive the panels at little to no money down. But still, you should bear in mind the true cost of leasing solar panels and know that signing these contracts doesn’t mean that you will receive the panels for free, not exactly.

They are set up by solar companies hoping to make some profits out of it. So, you will be expected to pay for the power you receive at the end of the month, either at a fixed cost or in accordance with how much you have used.

It’s not as free as you may think.

New York Solar Program for Communities and Low-Income Households

Community Solar New York couldn’t have come at a better time than this, when there are so many people in dire need of solar but are held back by the cost. This includes those from low-income families and marginalized rural communities.

The government provides a way for more people to make the switch to renewable energy. And the best part is that there is no need to worry about buying panels.

Thanks to the Solar For All Program New York,¹⁶ you can access solar with no upfront cost, as long as you pay for the subscription, which is a pretty small fee in comparison.

No more hefty energy bills and you are likely to end up saving hundreds.

How To Save Money on Solar Panel Installation New York

If this is your very first time installing solar in your home, and especially if you are on a budget, you may be interested in ways to save as much money as possible. The most common way that you are already aware of is taking advantage of incentives and rebate programs, but did you know that there are several other tricks?

One that works great for every beginner is comparing quotations. When you get to the groundwork and now want to get started, comparing costs from various companies helps you get a better bargain and save extra cash.

You will realize that some brands are a little overpriced, yet they offer the same products and services as other cheaper companies.

Secondly and very importantly, you want to check your financing option because it matters a lot. Take, for instance, paying for the installation in cash and using solar loans.

Loans have interest rates, convenient yes but you will actually be paying more by the end of it all. Cash upfront is way cheaper, and it helps that you can start making savings as early as day one.

How Long Do Solar Panels New York Last?

Durability is the first thing you will always look for in a product. Solar panels in New York are no different, especially now that you realize that installation can be quite costly.

What you want is a system that stands the test of time and is able to serve you for as many years as possible, not needing costly repairs or exchanges.

That is exactly what you get by going for high-quality solar panels from the most reputable brands in New York. With the right choice, your panels can end up serving you for as much as 25 years and it doesn’t mean that they will expire after that, only that they will gradually start degrading.⁸

When that happens, you can always seek services from the numerous solar panel recycling companies in the state or drop them off at designated locations to ensure that they are safely disposed of.

Before You Take on New York Solar Incentives: Daily Peak Sunlight Hours NY

There are pros and cons of solar energy, and as an investor in solar panels, you should know what to expect, both the good and the bad. The main problem with solar in New York is the fact that it is not exactly the sunniest state.

What’s even worse is that you may have to deal with shading from buildings and trees nearby. You can only expect around 4.5 hours of sun every single day, but sometimes less, so brace yourself for that as well.

The best that you can do is go for the most effective panels in the market that will harness as much sunlight as possible. Unfortunately, sometimes this means getting more solar panels, which hikes up the total cost.

Thankfully, there are solar incentives to fall back on when the upfront cost is too high.

Why the Cost of Solar Panels in New York Is Worth It?

Admittedly, New York may not actually be the first place that comes to mind when you are thinking about the booming solar power markets.¹⁷ The sunny days are not so many, but it doesn’t seem to deter the government from providing some of the most attractive and enticing incentives for its people.

If you are doubting are solar panels worth it in NY, these may change your mind.

1. Solar is way cheaper than grid power: Forget the price tag of installing solar panels, what matters is that you will end up saving quite a lot of money in comparison to obtaining power from the grid.
2. Solar increases your home’s value: This is the best part. Does solar increase home value in New York?
   Yes, and by how much? A whole 5.4%, this is even more than the national average of 4.1%.
   Therefore, you can treat the solar installation as an investment too if you have any plans to resell your home.
3. Solar makes New York cleaner: The state has always had an issue with toxic emissions from fossil fuels and using solar is the best way for the state to get a massive clean-up. The renewable power source is way cleaner and eco-friendlier, and it is easy to tell, thanks to the low carbon footprint solar panels.

If you are a New Yorker and are wondering how to reduce your energy bills, think solar power. It may not seem workable at first, given the low sunlight hours, but the amount of money you will save makes it all worth it.

The high energy rates in the state make converting to solar power all the more lucrative, especially now that your payback period will reduce.

You need not worry about the high initial cost, because chances are high that it will be less considering your energy uses and other factors.

Besides, the several available New York solar incentives have done a great job so far in reducing the cost of solar panels in New York.

Frequently Asked Question About New York Solar Incentives