New York Solar Power Rebates, Tax Credits, and Incentives

new york lights solar New York Solar Power Rebates, Tax Credits, and Incentives

Last Update 10/21/09

Solar Legislator Score: New York Solar Power Rebates, Tax Credits, and Incentives New York Solar Power Rebates, Tax Credits, and Incentives New York Solar Power Rebates, Tax Credits, and Incentives New York Solar Power Rebates, Tax Credits, and Incentives New York Solar Power Rebates, Tax Credits, and Incentives

Update 2/24/10: One Block Off the Grid has plans to run a Long Island group purchasing campaign, as well as one in Brooklyn (it’s listed as ‘on the horizon‘). 1BOG’s campaigns typically reduce the cost of going solar by 15-20%. Sign up for the Brooklyn Solar or Long Island Solar campaigns.

SOLAR INCENTIVES AND NET METERING

New York! New York! Sing it: I want to wake up in the city that never sleeps. Where I’ll be king of the hill and top of the solar heap, or words to that effect.

New York has been fairly good to solar, it may not last. There’s lots of incentive dollars funded, but so far, the State rebate is scheduled to phase out at the end of 2009 unless it’s extended and re-funded. Good luck with that in a recession, but you never know.

The other issue about New York is its net metering policy, which mandates that the major investor owned utilities let you store any excess energy your solar panels produce with the grid. Then they credit your bill when you need it, say, at night, when you know, the sun isn’t shining. At the end of the year, if your panels have produced more energy than you’ve consumed, they’ll pay you the “avoided cost” (wholesale rate) for your extra energy.

So what’s not to love besides the rebate ending soon ? Net metering is currently limited to 1% of their 2005 total capacity. That means, as soon as Con Ed or one of the other major utilities get enough solar people and businesses into the program, anyone over 1% won’t get net metering. So if you’re thinking about solar, get it soon and while you can or bug the state’s public utilities commission to raise that 1% cap for net metering.

State Rebates

As of September 2009, the current State rebate program will expire at the end of 2009. It’s been going since 2008.

Residential Eligibility: You’ve got to be a customer of:  Central Hudson Gas & Electric Corporation, Consolidated Edison Company of New York, New York State Electric & Gas Corporation, Niagara Mohawk Power Corporation, Orange and Rockland Utilities, and Rochester Gas and Electric Corporation.  Keep in mind that the remaining utilities may have their own programs (see below).

The NY Solar Incentives:

  1. Residents get $3/watt ($2.50 as of 10/13/09 ) up to 4 kW size systems. For larger size systems, you get the initial payment plus a reduced  $2/watt ($1.50 as of 10/13/09 ) up to 8 kW. The total rebate can’t exceed $28,000, ($24,000 as of 10/13/o9) however.
  2. Residents get 25% of net (post rebate) cost up to $5000 New York  state tax credit towards their NY state income taxes.
  3. Residents do not have to pay any sales tax on your solar systems, including solar hot water.
  4. Residents get an additional 8.75% of solar cost property tax abatement each year for 4 years through 2010. If you install after January 1, 2011 to the end of 2012, it gets cut to 5% of system cost for the next 4 years.

Confused? No worries.  Let’s give an example of a medium to average 5kW system and break down your costs. (You’re going to be floored how much this rebate adds up. )
EXAMPLE OF AN AVERAGE 5 kW (5000 watt) RESIDENTIAL SOLAR INSTALLATION

Note: This example of a 5kWh system reflects the recent reduction in the State rebate program, effective 10/13/09. There is a net reduction of $1,750, before your tax person puts in or taxes away his or her 2 cents. Probably more than 2 cents.

  • Utility and Average Bill: You live in Con Ed Territory with a $150/month average bill.
  • 5Kw System will cover: About 93% of your total yearly electric bill. (By NY State law, you could get a rebate for a system that covers as much as 110% of your bill, but let’s not be greedy here.)
  • Cost Before Rebates: Installed cost is going to be around $7.50/watt as of September 2009.  Could be more or less depending on your home, competition, and other environmental factors. For a 5kW system, that adds up to $37,500 ($7.50/watt x 5000 watts (or 5kW))  But don’t Panic! Again, that’s before all of the rebates and incentives.
  • Rebates: Subtract $14,000 $12,775 according to  NY’s clean power estimator numbers. (We’re assuming it’s now up to date, although our math didn’t exactly match it. We’ll defer to the State, however.)
  • Subtract $7,050 $7,418 (this more because of the decreased NY rebate) for the 30% Federal tax credit (calculated after subtracting the State rebate.)
  • Subtract another $5,000 NY State Tax Credit
  • Unfortunately, you might have to add about $14o0 because the Feds may consider the NY $5000 tax credit income. PLEASE Check with your personal tax person. This will affect you differently with your income(s), etc.)
  • NET COST for 5kW Solar System: $11,450 $13,708 (Remember that you will have to finance more than this, since the installer can’t accept your various tax credits as payments.)
  • Years to Payback: Thanks to energy savings and incentives, under 10 years!!! (8.7 years, according the estimator, but we again want to be conservative.)

That doesn’t include the estimated increase in your property value – $11,420 to $22,240. Oh, yeah:

  • New Utility Bill: With net metering, $232 for the first year (an average of 20 bucks a month.) This should cover 87% of your current electricity needs for the next 25 years.
  • Est. cumulative 25-year utility savings: $30,073 assuming according to the  Con Ed raises its rates a conservative 1.5% a year, but probably will raise more, don’t you think?
  • Don’t forget NYC residents get even more through the property tax abatement,
  • Environmental benefit: You’re preventing 6272 lbs a year of dirty coal power polluting the state of NY. For 25 years of  your solar system’s life, that adds up to 156,800 tons of CO2.
  • Please remember that you may need a larger –or smaller–system. It all depends on your energy usage. Other cost factors may be your type of roof, shading, your utility, rate plans, and other factors.

For those that are not in the above listed utilities, there are other Solar and Energy Efficiency Programs that you may qualify for (as listed by this national government database of solar incentives):

Update 11-18-09: New PACE Loan Program

Cities in New York can now offer PACE financing. What’s PACE? Check out this post here. Basically, New York cities can now offer financing of solar systems through a special tax assessment on your property. Many, many advantages. You can help them know about PACE by using this handy-dandy “Hello, Mr. or Mrs. Lawmaker!” PR tool kit.

CONSENSUS

New York Solar rebates and incentives rock! … But only for as long as 2009, unfortunately. This also assumes that they do not further decrease the rebate or run out of funding all together. Hopefully, New York’s leaders will continue their fine work and take even greater advantage of the enormous opportunities for solar installer related jobs–not to mention environmental benefits–by continuing the rebate program past 2009.
Click here to have multiple solar installers bid to upgrade your New York home or business.

No comments yet, be the first!

Comment on December 19th, 2007.

For anyone interested in putting solar panels on their house in the Albany/upstate NY region, please look us up at Renewable Power Systems. We’ve helped over 80 customers go solar in Albany in the past several years & so we know how to navigate the rebate/incentive waters quite well.

h. robins Identicon Icon h. robins
Comment on March 25th, 2008.

is there any info that you can send me or can you tell me about rebates from the government to make the install cheaper

chris Identicon Icon chris
Comment on October 16th, 2008.

where do i get a list of percise rebates and incentives offered by ny state as well as LIPA?

Comment on February 21st, 2009.

Dear Sir/Madam, I would like to start a similar service to yours (this web site) in South Africa where we have a desperate need for energy other than our “cheap” coal. Would you be prepared to assist me with this project?
Regards, George

Pingback on March 23rd, 2009.

[...] Kips Bay project was completed under the auspices of the New York State Solar Electric Incentives Program, and qualified for a rebate that covered almost half the cost. Additional incentives, in the form [...]

Comment on April 8th, 2009.

Is there any reason the cost for mains electricity is so high in NY state?

shirley hirsch Identicon Icon shirley hirsch
Comment on April 23rd, 2009.

shirley
I live in Rockland County, N.Y.I would like to install a solar hot water heater for my pool. Can I qualify for a grant and what are the incentives? (I am handicapped)

john Identicon Icon john
Comment on May 2nd, 2009.

hi i live in staten island n.y i am interested in installing solar panels i want a 8kw system enough to get me off the grid can you tell me what all the rebates are

Joan Bobbette Identicon Icon Joan Bobbette
Comment on June 12th, 2009.

What about off-grid systems? Doesn;t it seem that everything is geared to helping the utilities and not the consumers? What rebates and incentives are available from New York State for off-grid systems?

Pingback on September 7th, 2009.

[...] our  New York Solar rebate page for a full breakdown and explanation of the rebates and payback, but here’s the bottom [...]

K Identicon Icon K
Comment on September 17th, 2009.

Subtract $7,050 for the 30% Federal tax credit (calculated after subtracting the State rebate)

! BUT The federal credit is limited to $2,000 see form 5695 !

Comment on September 17th, 2009.

That form is out of date. There is no longer a $2000 cap on the Federal Investment Tax Credit. It is 30%.

Michael Crowell Identicon Icon Michael Crowell
Comment on October 15th, 2009.

According to the LI Power Authority, the NYS tax credit is not $5,000, but “25% Residential Tax Credit on net costs for a solar electric system” UP TO $5,000. (http://www.lipower.org/efficiency/solar-home-rebates.html) Also, according to a solar contractor we’ve talked to, this is based on the net cost AFTER any power company rebates (in the case of LIPA, $3.50/watt)

Comment on October 15th, 2009.

Sorry for the misunderstanding, Ron. You’re right, and we’ve fixed it. However, for the example that we gave, it would not have made a difference, as the 25% of net /post rebate cost would still have been over the $5,000 cap. If you have a smaller system than 5kW, however, yes, it would have meant a lower state tax credit.

Thanks for pointing that out. We short hand things here to keep it simple, but that’s one we should have been more specific about. Hope our error didn’t keep you from going solar.

Paul Identicon Icon Paul
Comment on October 19th, 2009.

Why do most of the solar calculators out there (NYSERDA’s for one) estimate an annual electricity savings so much lower than yours? Most say the same system (5kW with regular bill of $150 per month) will save only about $300 per year. I’m hoping you are right, but you’re the exception, not the rule. Thanks.

Comment on October 19th, 2009.

Here’s the difference, Paul. First of all, your utility and their rate plans matter. I wrote the above example for Brooklyn, originally, but I realized that doesn’t apply to most of the state. Just NYC, because of a special tax abatement. This latest estimate is for Westchester (updated 10/21/09).

Also, most calculator parameters are set to a “Default” per watt charge and other defaults. These are usually way behind the times or are too conservative. Based on our sources, we try to give you a competitively priced example that’s in the middle, but it’s always lower than the default (higher) price.

Of course this default changes all the time. I actually wrote the NY post BASED on the NY calculator. The difference is that I changed the cost parameter to $7.50/watt (7500/kilowatt.) What you save per year is going to also be based on what you input as the your electric rate, as well as what you anticipate the rate rising over the next few years. Taxable income and marital status also affect these figures.

This is one reason why I don’t like these public calculators. You really have to know how to use them and have the right info to use them. We do our best to keep up to date as professionals, so we’re better than others. The other problem, as I said earlier, is that the rates change…but the software isn’t updated to reflect that.

In any case, I just redid my calculations using the parameters that I believe I used and I was off. I also had to update because the new rebate rates just went into effect. This may also be the difference, but I swear I didn’t pick that earlier number out of my solar butt. I just input another parameter, and I don’t remember what that is…or the NY state rate software was updated and is now giving a more conservative figure.

I’m thinking the latter because we really, REALLY try to be transparent and honest on SolarPowerRocks. In all of our posts, we simplify things, yes, so that you can understand it, but we are always honest with our figures.

As always, if you want to check our figures, get a few quotes from one of our partner installers. Bottom line, we’re human and we make mistakes or are outdated sometimes, but we’re always transparent and if we make a mistake, we’ll always cop to it and tell our readers. If we were trying to hide something, we wouldn’t have published your comment and I wouldn’t have spent the last hour updating the post. The delete button is so much easier, but that’s not how do things here at SPR.

Thanks for the question!

Pingback on October 24th, 2009.

[...] by 10/13/09, you’ve just lost a couple of thousand dollars in NY solar rebate money. The full explanation is on our updated New York page, but the bottom line is that Solar just got a little more expensive.  Want to hear another scary [...]

Pingback on November 2nd, 2009.

[...] its incentive by 50 cents per watt in October. According to Tor Valenza, a Green Inc. reader who blogs about solar, that amounts to a net reduction of roughly $1,750 for a five-kilowatt system, depending on the [...]

Pingback on November 17th, 2009.

[...] UPDATE: PACE PASSES BY A UNANIMOUS VOTE! Thanks so much for your help in bringing the potential for no-brainer financing to the State of New York! You rock for solar, New York! [...]

tim Identicon Icon tim
Comment on November 18th, 2009.

I just got a Quote for a Solar PV system with a flat roof installation of amphorous tubes and crystal PV as an awning on a balcony for approximately 10 per kwt
is this a fair price in todays market.
3 story building, flat roof, third floor balcony for the solar awning.
Net metered system.

Comment on November 18th, 2009.

Tim,

$10 sounds high for a typical system, but it sounds like you’re doing this in a more customized way than typical. You also need racking, which is extra, and if you’re using as an awning, you’re probably paying extra for that hardware. Also don’t know about any other electrical upgrades needs you might have, which can add to the cost. So…. I would get 2 or 3 quotes to be sure.

If it were a normal, typical roof top system, without any unusual extras, it should be around $7.50/watt or $7,500/kilowatt, installed. New York is also not as competitive as other states, where it might be even less. But again, it sounds like you’ve got extras, so… might be fair. Best to get another quote and compare.

Steve Identicon Icon Steve
Comment on January 18th, 2010.

NYSERDA reduced their incentives again on 1/11/2010. Here is a link to the new incentives: http://www.powernaturally.org/publications/SummaryofRevisions101309.pdf

Comment on January 18th, 2010.

Thanks for the info, Steve. Essentially, for all those afraid of clicking downloads, the incentives have been chopped to $1.75/watt ($1750/kW) for residential to a maximum of 5kW. For commercial, it’s also $1750/kW but up to a 50kW system. Also, in both cases, you can’t get more than 50% of the installed cost covered by the rebate, but don’t forget you’ll also be getting the 30% Federal Tax Credit, so this is still a great deal. Thanks, NY!

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