New York Solar Incentives (2024 Tax Credits & Rebates)

New York is one of the most popular states for solar conversion, and a big part of why solar is so worthwhile in the Empire State is the solar incentives that are available. While equipment costs are high, New York solar incentives help make clean energy more accessible and beneficial.

I’ve spent years researching and writing about solar incentives, and I just recently navigated all of the New York solar incentives myself when I had my solar array installed on Long Island. In this guide, I’ll explain all of the solar rebates, incentive programs, and financing opportunities available in New York that can help you save money as you reduce your carbon footprint by going solar.

Highest Quality Panels

4.4

Installs high-quality Maxeon panels

Outstanding customer support

Best-in-class warranty lasts 40 years

GET QUOTE

Best Damage Protection

3.7

Affordable prices

Excellent selection of panels and services

Locations in 22 states

GET QUOTE

Best Solar Financing

4.3

No payments needed for 18 months

Provides in-house financing

Offers top brands like LG and Trina

GET QUOTE

Best Customer Service

3.9

Highly rated customer service

Provides  24/7 panel monitoring

Solid A+ rating with the BBB

GET QUOTE

How Does New York Rank for Solar Incentives?

New York is considered a pretty green state, so it shouldn’t come as a surprise that it offers more solar incentives than most other states. It’s a good thing, too, because the cost of photovoltaic equipment in New York averages around $2.95 per watt, which is significantly higher than the national average of $2.66. The available incentives help make renewable energy systems more affordable and bring the cost down to what residents in cheaper states might see.

The table below includes a quick breakdown of all of the solar perks available in New York. I’ll include some average savings you can reasonably expect from these incentives, according to my research. I’ll go into greater detail about each line item in the sections that follow.

Federal Solar Tax Credit (ITC): How It Impacts New Yorkers

My Take: In my opinion, the federal solar tax credit is still the most beneficial perk available in NY, despite the many state incentives offered. It takes just minutes to apply and can potentially save you thousands on your system.

The federal investment tax credit is a tax incentive offered by the federal government to help make solar conversion more accessible and affordable. Basically, you get a tax credit in the amount of 30% of your total system installation cost, which includes all of the equipment — panels, inverters, solar energy storage systems, electric vehicle (EV) chargers, mounting racks, wiring, and hardware — as well as the labor to install everything.

With the average solar panel system price in New York sitting at $19,175, the average credit value is $5,753. That amount gets deducted from any federal income tax you owe for the year your system is installed. This is a critical point to understand, as I’ve heard a lot of people refer to the credit as a rebate. It’s not a rebate, so you only get the benefit if you owe the estimated credit value or more on your income tax bill.

Thankfully, you can roll over any unused credit to future tax years for up to five years, so as long as you expect to owe around $1,150 or more per year for five years after installation, you should be able to take the entire credit value, on average.

The federal tax credit was first offered in 2005 as a part of the Energy Policy Act. At its inception, it was good for 30% of the system installation cost, but the rate decreased and was bumped back up a few times. Most recently, the Inflation Reduction Act passed in August of 2022 extended the credit for an additional 10 years and pushed the credit back up to its original 30%. The current credit rate schedule is as follows:

• 30% for systems installed through 2032
• 26% for systems installed in 2033
• 22% for systems installed in 2034
• The credit will no longer be available as of January 1st, 2035

Highest Quality Panels

4.4

VISIT SITE

Limited Time:

$1,000 Rebates For Military Personnel

Which Solar Incentives Are Offered at the State Level in New York?

I recently went solar in New York myself and was happy to see just how many state-level incentives there are to make solar more affordable and accessible. While the federal credit is outstanding, the state perks come in at a close second in terms of potential savings, which is ideal for a state like New York, which has above-average photovoltaic (PV) equipment costs.

I’ll list the New York state incentives below and then explain how helpful they are in the following sections.

• New York Solar Energy System Equipment Credit
• NY-Sun PV Incentive Program
• New York State Solar Sales Tax Exemption
• NY-Sun Loan Program
• Energy Conservation Improvements Property Tax Exemption

If you’re serious about going solar and you live in the Empire State, you may want to read up on the reputable solar companies in New York that we recommend.

New York Residential Solar Energy System Equipment Tax Credit

My Take: The solar tax credit in New York is the best state incentive, in my opinion. It works just like the federal credit, although there is a cap on the credit. The cap is fairly high, though, and the credit can still effectively save you up to $5,000.

The New York solar tax credit works just like the federal credit in that it’s an income tax credit and not a rebate. You can get up to 25% of your total system installation costs credited to your income tax liability for the year you install your system or up to $5,000, whichever is lower.

Most New Yorkers will spend an average of $19,175 on their solar array, so unless you also install solar batteries like I did, you probably won’t be able to take the full $5,000. However, you’ll get close, as 25% of the typical system cost in the state is just under $4,800. Much like with the federal credit, you can carry over unused credit for up to five years.

It’s worth mentioning again that this is not a rebate, so if you don’t owe money on your income taxes, you can’t take this credit, either. Plus, you’ll need to owe a total of close to $11,000 in income taxes to take both the ITC and the state credit, or around $2,200 per year over five years from your installation date.

The state tax credit in New York was first offered in 1998, making it one of the earliest statewide solar tax credits in the country. The perk hasn’t changed since its inception other than adding solar thermal equipment to the credit eligibility and again in 2012 to include systems under lease and power purchase agreement (PPA). There’s currently no expiration date for the state credit.

NY-Sun PV Incentive Program

My Take: This solar rebate program helps reduce the upfront cost of going solar, assuming you’re eligible. Perks like this are incredibly helpful in high-cost areas like New York, although eligibility is limited.

The NY-Sun PV Incentive Program is a solar rebate program created by NYSERDA (New York State Energy Research and Development Authority). It provides cashback incentives to homeowners who convert to solar.

The rebates offered change over time based on how many people in the state install solar and enroll in the program. At the time of writing, the rebate amounts are as follows:

• Con Edison region: $0.20 per watt installed, or an average of $1,300
• Upstate region: $0.20 per watt installed, or an average of $1,300
• Long Island: The program limits have been met, so the LI region is no longer eligible

Additionally, you can only apply for this rebate if your solar electric system is 25 kW or smaller, which includes virtually all residential solar power systems.

The PV Incentive Program — originally called the Megawatt Block Incentive — was initiated in August 2010, and the caps were put in place at that time. Since then, only the Long Island region has met the cap. The program is set to expire at the end of 2030, although the caps for the other regions might be met before that time.

You can check out the video below for a quick explanation of how this tax credit works:

New York State Solar Sales Tax Exemption

My Take: Sales tax exemptions are an easy and effective way for states to reduce the upfront financial burden of going solar, so this is an outstanding incentive. Plus, it’s automatic and requires no work from you to apply.

Solar equipment sales tax exemptions are popular perks for states to offer because they don’t require program funding and can reduce the upfront cost of solar equipment for solar customers. With this incentive, the state sales tax is waived on all PV equipment, including panels, batteries, racking systems, wiring, and more.

The New York State tax is 4%, and the typical home solar panel system costs $19,175, so this perk can reduce the average solar project total by approximately $767. This perk provides fewer savings than most other benefit programs, but it’s automatic and isn’t a tax credit, so you’ll save upfront.

The sales tax exemption on renewable energy equipment was initiated in New York in 2005 for residential solar customers and has offered a 100% exemption on all equipment since then. The program currently doesn’t have an expiration date.

NY-Sun Loan Program

My Take: Financing programs are always great to see because they help make solar more accessible to more residents. I especially like the three creative financing options offered through this program, which can help customers who normally wouldn’t be able to get financing acquire the credit and convert.

The NY-Sun Loan Program offered by NYSERDA provides three financing options for solar equipment:

• On-bill recovery loans: On-bill loans add the monthly financing cost for your system to your utility bill for easy and convenient payment. Interest rates and savings vary. Keep in mind that this type of loan would need to be transferred to the new owner if you sell your home. These loans can cover between $1,500 and $25,000 worth of PV equipment with terms of 5, 10, or 15 years.
• Smart energy loans: These loans are basically state-backed loans offered directly through NYSERDA. Interest rates tend to be lower than you’d get from private financing. These loans can come with terms of 5, 10, or 15 years and can cover between $1,500 and $25,000 worth of solar equipment.
• Renewable energy tax credit bridge loans: These loans let you finance the credits you expect to get from the ITC and the state tax credit to bridge the gap between when you apply and when you see the “savings.” These are short-term loans with terms of two years, and they can cover between $1,500 and $25,000 worth of equipment.

The NY-Sun Loan Program was developed in 2009 when financing from the Green Jobs Green New York Act became available. In 2014, solar thermal systems became eligible for funding through the program, but other than that, the specifications of the incentive haven’t changed at all. Presently, there isn’t an expiration date for this perk.

Energy Conservation Improvements Property Tax Exemption

My Take: The bump in property taxes after going solar is one of the only major downsides of converting to clean energy. This perk is helpful because it prevents your property taxes from going up after you install solar panels.

The property tax exemption prevents your property taxes from going up as a result of going solar. Normally, any home improvement project that increases your home value will also make your taxes go up. Since solar conversion makes your home more valuable, it would typically cause a bump in your property taxes, but this exemption prevents that from happening.

The statewide property tax exemption prevents your property taxes from increasing for 15 years. Ultimately, it voids the biggest downside to going solar, so it’s a useful perk that can help you save money on your property taxes over time.

It’s challenging to calculate exactly what this perk will save you because the savings are based on your local tax rate and the actual cost of your system. Based on the average property tax rate in the state and the average solar system cost, though, you can expect savings of around $310 per year or a total of $4,650 over the 15 years that the exemption lasts. Actual savings will be lower because of system value depreciation.

The property tax exemption was first made available in 2013 in New York State, and it hasn’t gone through any major changes since. There is currently no expiration date for this incentive.

Highest Quality Panels

4.4

Installs high-quality Maxeon panels

Outstanding customer support

Best-in-class warranty lasts 40 years

GET QUOTE

Best Damage Protection

3.7

Affordable prices

Excellent selection of panels and services

Locations in 22 states

GET QUOTE

Best Solar Financing

4.3

No payments needed for 18 months

Provides in-house financing

Offers top brands like LG and Trina

GET QUOTE

Best Customer Service

3.9

Highly rated customer service

Provides  24/7 panel monitoring

Solid A+ rating with the BBB

GET QUOTE

Which Solar Incentives Are Offered at the Local Level in New York?

The majority of the savings you’ll see for your solar array will be from federal and state incentives in New York, but there are some local perks you might be able to get. These can help improve your energy savings over time and even bring down upfront installation costs in some cases. I’ll list the local solar incentives in New York below and explain how each one works.

• PSEG net metering on Long Island: This is a special net metering program for Long Island residents. In addition to the statewide net metering policy — discussed in greater depth in a later section — this perk provides payouts for unused energy credits at the end of the year at the avoided cost rate.
• City of Riverhead energy conservation device permitting fee reduction: This is a permit fee reduction for solar permits for residents of the city of Riverhead in eastern Long Island. The savings are minimal, but every dollar counts in a high-cost area like New York.
• New York City (NYC) property tax abatement: This is a property tax abatement for the City of New York property taxes, which is in addition to the state property taxes charged to Manhattan residents.
• New York City solar sales tax exemption: This perk waives the city sales tax on solar equipment in Manhattan. This local sales tax exemption is in addition to the state sales tax exemption, so it brings down upfront conversion costs even further.

Net Metering in New York: Can You Profit?

Like many of the other best states to go solar, New York provides a mandated net metering program to solar customers within the state. Net metering is a program that credits you for the solar energy you produce but don’t consume, which means you can offset your energy consumption at night or on cloudy days when you’re likely to pull more power from the grid than you generate.

Net metering is a massively beneficial program that, unfortunately, is being made less appealing and even phased out in many states, so I’m happy to see that it’s still available in New York. Not only is it available, but the incentive is better than the equivalent in many other states. New York’s net metering policy states that customers must be credited at the full retail rate for excess kilowatt-hours (kWh), so every kWh you overproduce means a full kWh you pull from the grid is essentially free.

With the solid net metering policy in New York, it’s possible and even probable that you’ll eliminate your energy bills or at least offset most of them, provided your system is sized properly for your home.

Net metering in New York was first offered in 1997 and was only available for systems up to 10 kW (which includes most residential systems). In 2017, the Value of Distributed Energy Resource (VDER) was established, which changed how credits were accrued and what they were worth based on supply and demand. Under the new policy, some customers can get paid for their unused energy credits at the avoided-cost rate. This is below the retail rate, but it still means you could profit from your solar array using net metering.

There is currently no expiration date lined up for New York’s net metering policy, although the program is subject to change again (as it has in the past).

Highest Quality Panels

4.4

VISIT SITE

Limited Time:

$1,000 Rebates For Military Personnel

Watch Out For Solar Incentive Scams in New York

Solar is more popular in New York than it is in most other states. While this is positive, unfortunately, it also means the Empire State is a hot spot for solar scams.

Prior to installing my panels, I experienced this firsthand. Numerous solar companies came to my door and pitched solar using high-pressure sales tactics. Some of them even asked for a copy of my electric bill to “verify my consumption and estimate my savings.” Some companies use that information for nefarious purposes, so you should always avoid that.

There have been reports of similar companies getting personal information by pretending they’re employed by NexAmp, a legitimate company that built solar farms in New York and opened up the possibility of community solar for customers. Other reports mention solar scammers charging sign-up fees for grants and other fake solar incentives, only to disappear and never be heard from again.

I’ve witnessed other companies representing the federal tax credit as a guaranteed rebate when, in actuality, it’s not. The tax credit only benefits you if you own a significant amount in income taxes, so be aware of companies misrepresenting this perk.

The best way to avoid scams is to do your research and not fall prey to aggressive sales tactics. You can use this page to reference state solar incentives you hear about to see if they’re legitimate and being presented accurately.

Bottom Line: Do the Incentives in New York Make Going Solar Affordable?

New York is the ninth most popular state for solar conversion, according to the Solar Energy Industries Association (SEIA). Solar equipment in New York is more expensive on a per-watt basis than it is in most other states, but the incentives available from the federal government and on a state and local level help make converting to clean energy and reducing emissions more accessible in the Empire State. By taking advantage of all of the perks mentioned above, you could effectively reduce your solar conversion costs by an average of $11,000, and the net metering policy means your panels will deliver greater net savings over time as well.

We recommend exploring our article to better understand the savings achieved with solar panels.

When you’re ready to convert to solar and take advantage of these incentives, you can use the tool below to be connected to a certified provider in your area that can help you file for these perks and maximize your savings.