Going Solar in New York State

SolarCalendarOctober 9, 2018

We try to keep consumers up to speed on trends and changes in the solar energy industry, but because solar energy markets vary so much by state (and sometimes even city), the information can be very broad. In this series of case studies, we’ll explore what going solar looks like in specific areas. Don’t see your state mentioned? Check back soon for new additions.

The Case for New York Solar Energy

If you live in New York, you’re paying utility rates among the top-10 highest in the nation.1 It’s easy to see why so many New Yorkers are looking for alternatives and switching to solar energy. The great news is New York’s policies and regulations are very supportive of residential solar energy. This makes the decision more economical for homeowners.

Read on for the details on clean energy savings in the Empire State. We’ll start with the information you need to know for a solar purchase, meaning you buy your system either outright or with a loan. Then we’ll cover how solar energy loans and PPAs change things.

Solar Energy Incentives for New Yorkers

New York residents who install rooftop solar equipment are eligible for the federal Renewable Energy Tax Credit, which is equal to 30 percent of the cost of a PV solar system (through 2019 with the credit decreasing through 2021). That’s a good-sized savings! Some solar companies will claim the credit (saving you paperwork both on the application and your IRS forms come tax time) and pass the savings on to you. Others will leave it for you to claim.

In addition to the federal tax credit, New Yorkers who install rooftop solar equipment are eligible for NYS solar tax credits. The personal tax credit in New York state is about 25 percent of the cost of your system up to $5,000.2 If you’re doing the math, you’ve calculated that more than half the cost of a rooftop solar energy system can be offset by tax credits in New York state.

And we’re not finished yet. New York also offers a property tax exemption for the value of your solar installation. Some municipalities have opted out and New York City instead offers a property tax abatement, so check the details to see if you qualify. Finally, NY-Sun offers additional incentives through approved contractors. This includes an Affordable Solar program for income-qualifying households. To sum up: New York has a very healthy incentive package!

Net Metering in New York

While not technically an incentive, New York’s net metering program is another financial piece of the puzzle that makes solar energy a strong option in the state. Essentially this agreement allows you to send any electricity you don’t use to the grid for a credit from your utility. The credit offsets the cost of buying power from the utility when you need it (after dark, for example). With a well-designed solar energy system, this can cut your electricity payment significantly - or even completely.

New York solar energy customers can send their surplus power to the grid for retail-rate credits. Once a year, excess generation is reconciled at the avoided cost rate. That means any credits you haven’t used are cashed out at the utility's wholesale market rate. A cool feature of New York’s system is that you get to choose when that reconciliation happens.3

Return on Your New York Solar Energy Investment

Here’s where we get to the bottom line. You now know that New York has some of the best incentives for solar installations in the nation. You know you can get a great price on a rooftop solar system. But does that great price translate to savings on your utility bills? The short answer is yes! Check it out.

The estimated savings for the average home in New York with a solar energy system is $19,000 over 20 years,4 which is pretty great when you consider most rooftop solar systems are rated to last 20 years or more. Of course, savings will vary based on the size of your home and how much power you use. We’re guessing you already have some ideas of how to use that extra chunk of change. Plus, you can’t put a price on knowing your power comes from a clean, renewable source!

Loans, Leases and PPAs

The calculations and projections above are based on owning your own solar system, but solar plans in New York come in other shapes and sizes too. We’ll take a look at each (for more details, visit our Solar Plans page):

  1. Solar Purchase​ - we covered this. It’s the most straightforward. Buy your solar system up front, plain and simple.
  2. Solar Loan​ - similar to a solar purchase but you finance your system with a loan. If you use a loan to purchase your system, the savings you see will vary a bit based on your particular loan terms. Some large solar installers offer solar loans, while other companies will refer you to third-party financial institutions. Some homeowners choose to take out a home equity loan to finance their panels. Exploring more than one loan option can help you get the best rate for your system.
  3. Solar Lease​ - you lease the panels while your solar provider maintains ownership.
  4. Solar Power Purchase Agreement (PPA)​ - you buy the power your panels produce and your solar provider maintains ownership of the panels.

Solar leases and PPAs are slightly different than solar purchases and loans - you won’t own your panels or be eligible to claim the federal tax credit. The savings should still be passed to you though. Your solar provider can claim those incentives and factor them into your monthly payment. In New York, you’ll be eligible for the state tax incentives no matter which type of plan you’re under and you’ll also still qualify for net metering. Lease and PPA customers typically aren’t required to make a down payment.

Savings can be easier to compare with leases or PPAs. Take the monthly payment specified on your solar bid and compare it with your average monthly electric bill. Keep in mind you’ll likely still have to pay a small monthly fee to your utility for grid connection and you may occasionally need to buy power from them.

Stack Your Savings - EVs, Home Batteries and Utility Rate Options

There are even more ways to save with solar in New York. You can choose these products or programs when you have your solar system installed or add them later to maximize your clean energy benefits.

  • Take advantage of New York’s Drive Clean Rebate and make the switch to an Electric Vehicle. Learn more about saving money (and improving air quality) with your own solar EV charging station in this Q&A with a Clean Energy Trailblazer.
  • Add a home battery to maximize flexibility of when to use the power generated by your solar panels.
  • Look into your utility’s Time of Use rates to find out if you can save money by switching to an optional rate structure. The flexibility you get with solar panels - especially combined with a home battery - can make it easier to choose when to use power from the grid.

Get the Figures for Your Home

No matter which options you choose, there’s no denying that New York is a fantastic place to go solar. This post should give you an idea of how much you can save with solar, but the only way to know what you’ll save is to get a solar bid tailored to your home and electricity use. Let us give you a free quote today!



1 https://www.chooseenergy.com/electricity-rates-by-state/
2 https://www.nyserda.ny.gov/All-Programs/Programs/NY-Sun/Solar-for-Your-Home/Paying-for-Solar/Tax-Credit
3 http://programs.dsireusa.org/system/program/detail/453
4 Project Sunroof

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