- New York has a 70% renewable energy target by 2030 and 100% carbon-free electricity by 2040, with a 10GW solar carve-out.
- Homeowners in New York can save nearly $20,000 on utility bills with a 6kW solar system, thanks to federal and state incentives.
- New York offers a 25% state tax credit, a solar rebate per kW installed, and net metering regulations that can result in a paycheck for excess energy.
In 2022, the Empire State had over 4.4MW of solar energy, making it the 4th leading state for the renewable technology. Supported by some of the most aggressive energy standards, homeowners could save thousands on solar panels in New York.
But with the high cost of equipment, how do you even afford an array? Homeowners in New York have access to incredible incentives, including state tax credits, rebates, and more. Continue reading for a breakdown of all the available solar benefits.
How to Save Money on Solar Panels in New York: Overview
Although New York has high equipment rates and poor sunlight, it seems that homeowners can still save money by making the switch to solar. That’s because the Empire State has expensive electricity costs, which help to offset the price of an array. Those that purchase a 6kW system in New York could save nearly $20,000 on utility bills alone.
However, the benefits don’t end there; solar panels in New York receive some of the most support among any other state in the country. Backed by aggressive renewable standards, homeowners have access to a wide variety of incentives, including federal and state returns. Some regulations can even result in a paycheck. Let’s dig into these further.
Solar Panels in New York: Federal Incentive
Before you go further, you should seriously consider utilizing the federal solar tax credit. This incentive offers a 30% return on all solar purchases for your home, which includes equipment, labor, and sales tax. Those that apply this benefit to a 6kW system could save more than $5,000.
Be mindful, there are a few requirements to qualify for the federal incentive. First and foremost, you must own the system outright. This program lasts until 2035 unless it’s extended.
New York’s State Credits and Rebates
If you thought $5,000 was a good saving, why not add another 25% to that? New York offers a sizeable state tax credit alongside the federal one, making it incredibly easy to invest in solar. While it’s capped at $5,000, a 6kW system doesn’t quite touch that.
Additionally, New York offers a solar rebate per kW installed for up to 25kW. In some areas, you can receive $300 per kW (or $1,800 for 6kW). The program offers even more for low-income households, for about $800/kW. Between this rebate, the federal incentive, and the state credit, some New Yorkers could save nearly $15,000.
The Empire State also has a great net metering regulation. This is a mandate that requires utility companies to pay for excess solar energy connected to the grid. This payment comes in credit toward the next month’s utilities and continues to roll over until the end of the year. At that point, a check is written for the excess energy at the avoided-cost rate.
Solar Panels in New York: Government Regulations
These incredible benefits come from an aggressive renewable portfolio standard (RPS) We use a state’s RPS to determine its intention to invest in future clean energy. In 2020, New York expanded its RPS to target 70% renewable energy by 2030 and 100% carbon-free electricity by 2040.
Additionally, the Empire State has a solar carve-out. This is a mandate that requires a portion of its renewable energy to come from solar technology. New York has a 10GW solar carve-out by 2030. It currently sits at around 4.4GW.
To facilitate this, New York’s legislature made solar purchases exempt from both sales and property taxes. This means that your solar array won’t come with a sales tax, saving 4% overall. Additionally, your house won’t incur an increased property tax for its higher value. This exemption las for 15 years, saving you hundreds if not thousands over the period.
Should New Yorkers Lease Solar?
In many states, homeowners have the option to lease solar panels, making it easy to switch without having the upfront funds to pay for the system. While solar leasing typically disqualifies people from major incentives, including the federal solar tax credit, it does mean you don’t have to handle maintenance.
Fortunately, residents have the option to lease solar panels in New York. However, with some of the best incentives in the country, this is not wise. Especially if you’re low-medium income, you could cut the cost of an installation by nearly 80% with all the benefits applied. Not only will this save you on installation, but you’ll earn much more back without paying a monthly lease.
Solar Panels in New York: Incentive Summary
|Federal Tax Incentive
|New York Tax Credits / Rebates
|25% credit up to $5,000 / $0.30/W for homeowners in upstate NY for up to 25kW; $0.80/W for low-income households
|Yes, the annual check paid at an avoided-cost rate
|Renewable Portfolio Standard
|70% by 2030, 100% by 2040
|Property Tax Exemption
|100% for 15 years
|Sales Tax Exemption
|Performance Payment Program
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