New York solar incentives, tax credits and rebates

Resources for going solar in 2023

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After using the federal solar investment tax credit, the average solar energy system costs $13,423 in New York, which is cheaper than in many other states. The national average is $16,715.

We think New York is a great state for people interested in going solar. New York has fantastic solar incentives, tax credits and rebates for those wanting to add a solar power system to their property.

Key insights

  • You can take advantage of solar tax breaks, rebates and loan programs when installing solar power equipment in New York.
  • The average federal solar tax credit value is $5,760 in New York.
  • New York residents receive an average estimated net savings of $24,387 over 25 years with solar panels.

Solar incentives in New York

If you're thinking about going solar in New York, you should know about the federal solar investment tax credit (ITC). The tax credit lets you deduct 30% off your solar system’s entire cost from your federal taxes. The total amount you can deduct includes labor, equipment and permits.

Let's say you shell out $13,000 for your new solar system. When tax time rolls around, you'll get a $3,900 credit. The 30% credit is only good for systems installed through the end of 2032, however. After that, it drops to 26% in 2033 and then 22% in 2034.

Don't expect this to be a straight-up rebate or refund, though. When you file your federal taxes for the year your system is up and running, you must claim it and fill out Form 5695.

More solar incentives in New York

Incentive typeIncentive amountApplicable sectorsAdministratorAvailable statewide
Residential Solar Tax Credit Personal tax credit Up to $5,000 Residential, multifamily residential, low-income residential New York State Department of Taxation and Finance
State of NY Commercial PACE Financing Program Loan program Varies Residential New York State
Local Option - Solar, Wind & Biomass Energy Systems Exemption Property tax incentive 100% property tax exemption on added value for 15 years Residential, commercial, industrial, agricultural Administered locally
Solar Sales Tax Exemption Sales tax incentive 100% exemption from state sales tax for solar systems Residential, multifamily residential, commercial, industrial, integrators New York State Department of Taxation and Finance
Energy Conservation Improvements Property Tax Exemption Property tax incentive 100% of the value added to the residence Residential New York State Office of Real Property Tax Services
City of Riverhead - Energy Conservation Device Permitting Fees Green building incentive Lower permit fees Residential, commercial Riverhead Building Department
New York City - Property Tax Abatement for Photovoltaic (PV) and Energy Storage equipment Property tax incentive Varies Residential, commercial, industrial, nonprofit, schools, multifamily residential, institutional New York City Department of Buildings
NYSERDA - Residential Financing Options Loan program Varies Residential, multifamily residential, low-income residential New York State Energy Research and Development Authority (NYSERDA)
New York City - Residential Solar Sales Tax Exemption Sales tax incentive 100% local sales tax exemption for solar energy systems Residential Administered locally
Local Option - Solar Sales Tax Exemption Sales tax incentive 100% exemption from local sales tax for solar energy systems Residential, commercial, multifamily residential Administered locally
Local Option - Real Property Tax Exemption for Green Buildings Property tax incentive Varies Residential, multifamily residential, commercial Administered locally
NY-Sun Loan Program Loan program Varies Commercial, industrial, nonprofit, residential, federal government, low-income residential Green Jobs-Green New York
NY-Sun Commercial and Industrial Incentive Program Grant program Varies Commercial, industrial, federal government, installers/contractors, agricultural, integrators New York State Energy Research and Development Authority
NY-Sun PV Incentive Program (Residential, Low-Income, and Small Business) Rebate program Varies Commercial, construction, industrial, local government, nonprofit, residential, schools, state government, federal government, installers/contractors, multifamily residential, low-income residential, institutional New York State Energy Research and Development Authority

Statewide residential solar incentives in New York

Folks living in New York have more residential solar incentives than many other states. Incentives include multiple tax breaks, loan options and rebates.

Tax breaks

New York has a wide range of tax breaks for residents going solar. The state income tax credit is worth 25% of what you spend on the gear and putting it in place. There's a cap on how much you can get back, though. If you got your system rolling before Sept. 1, 2006, the max you can claim is $3,750. If you got it up and running on or after that date, you can claim up to $5,000.

Another tax break gives residents a 100% exemption from state sales tax for solar power systems. You can also write off 100% of the value of solar home improvements that increase the value of the home, like panels, solar water heaters, etc.

Some areas of New York also offer a property tax exemption for the value solar panels add to homes and a 100% sales tax exemption. If you live in the city of New York, you may qualify for additional property and sales tax incentives.

» MUST-KNOW: The tax benefits of owning a home: must-know deductions and secrets


The NY-Sun PV Incentive Program pays a portion of the cost of your solar system. The amount is paid directly to the contractor. How much money you get off your system varies depending on which local electric company you use. The town of Riverhead in Long Island also offers discounts on permits for solar improvements to homes.

Loan programs

Chances are you can find a solar loan in the state of New York even if you have less-than-stellar credit. New York State participates in the Property-Assessed Clean Energy (PACE) financing program. Through the PACE program, homeowners can get a fixed loan for their solar system and pay it back through a fee added to their property taxes.

The New York State Energy Research and Development Authority (NYSERDA) also has a loan program. New York residents who can't get traditional loans can qualify for this loan with lower interest rates.

There are two different loan types available through NYSERDA: Companion Loans and Bridge Loans. The Companion Loan lets you borrow extra if your project costs more than the cap on other loans. The Bridge Loan is a short-term financing loan that helps you borrow some of the money you'll get back later through tax breaks.

The NY-Sun Loan Program offers loans that range from $1,500 to $25,000. These loans can be paid back over five, 10 or 15 years.

What to know about net metering in New York

If the excess energy your system makes isn’t stored in a solar battery, it's sent to the power grid.

Net metering ensures that you get a credit on your electricity bill to pay for the energy you send to the grid. In New York, residential solar systems up to 25 kilowatts (kW) qualify for net metering. The credit is applied to the next month’s bill.

For example, Joseph in Amagansett, who went solar last year, said, “My electric utility bill is now just fees and taxes, no grid consumption.”

“I'm exporting to the grid. I'm happy about that,” another solar customer, Frank in Bloomingburg, told us. “What a lot of people might be concerned about, besides environmental, would be there's a significant cost savings. There are significant tax rebates.”

» GREENEST STATES: New York ranks No. 12

Solar resources in New York

Below are some additional resources that can guide you through transitioning to solar in New York.

» GUIDE: Solar panel installation guide

Find solar companies in New York

Compare popular solar companies available in New York below. Read our guide to finding the best solar companies for more.


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    Can I get solar panels for free in New York?

    No, you can’t get free solar panels in New York. Currently, there isn’t an incentive program that covers the full price of solar. You can, however, get a lease or enter a PPA with little to no upfront costs.

    » MORE: Free solar panels: Are they really free?

    How much can I save with solar panels in New York?

    In New York, the average savings is $24,387 over 25 years. Even if you don’t generate 100% of your energy needs, you can still save a lot of money compared with paying traditional utility bills.

    Are there any commercial solar incentives in New York?

    Yes, you can get property and sales tax exemptions, lower solar permit fees, solar loans and grants for solar projects.

    » MORE: Commercial solar panels

    Are there any disadvantages to going solar in New York?

    Weather is the biggest disadvantage to going solar in New York. The state only gets 3 to 3.5 peak sun hours daily, so systems won’t produce as much electricity as in other states. Heavy snowfall that’s common in the state can also damage solar systems.

    » MORE: Solar energy pros and cons

    Can I put solar panels on my condo?

    Before you think about buying panels, you've got to see what your condo association has to say. Check out the bylaws and have a chat with the board to see what's allowed.

    Is my HOA allowed to restrict solar panels?

    New York does not permit HOAs to restrict putting solar panels on your home.

    How can I pay for solar panels?

    Paying upfront helps you avoid interest rates and monthly payments, but there are some other options. You can finance solar panels through a solar loan. You can also lease solar panels or get a PPA (power purchase agreement).

    » SOLAR PANELS: Lease vs. buy

    Bottom line: How much are solar panels in New York?

    In New York, the average cost for a solar system, after tax credits, comes to $13,423, which is lower than the national average of $16,715. The state offers excellent incentives like tax credits, rebates and loan programs for going solar. With a federal tax credit average of $5,760 and an estimated 25-year savings of $24,387, New York makes a compelling case for switching to solar.

    “The average consumer who's going to be a homeowner should look upon this the same way that they look on buying a house, that is you're looking for the long haul,” according to Paul in Queens.

    “You're talking about spending a minimum of $15,000 for each floor on the costs after the rebates,” Paul said. “In my two investment properties on the block here two years ago, I've gone through two complete cycles and they work marvelously.”

    The ConsumerAffairs Research Team conducted an in-depth analysis to determine how much it costs to go solar in New York and the average solar costs in other states.

    Solar costs: New York vs. nearby states 

    Average cost per wattTypical system sizeUpfront cost*ITC value (30%)Payback period**Estimated net savings
    New York $2.94 6.5 kW $19,176 $5,760 10 years $24,387
    New Hampshire $2.91 6.5 kW $18,916 $5,675 9 years $28,409
    Massachusetts $2.94 6.5 kW $19,110 $5,733 8 years $33,013
    Pennsylvania $2.55 8.5 kW $21,676 $6,503 10 years $23,634
    *Before ITC federal tax credit; **When you pay in full upfront

    Article sources
    ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
    1. EcoWatch, “ Solar Panel Cost in New York .” Accessed Sept. 4, 2023.
    2. Environmental Protection Agency, “ Summary of Inflation Reduction Act provisions related to renewable energy .” Accessed Sept. 4, 2023.
    3. Solar Energy Industries Association, “ New York Solar .” Accessed Sept. 4, 2023.
    4. DSIRE, “ New York Solar Programs .” Accessed Sept. 4, 2023.
    5. DSIRE “ New York Net Metering .” Accessed Sept. 4, 2023.
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