Welcome to the New York City solar power information page – Details Section
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NYC baby! From Manhattan to Brooklyn to the Bronx, the five boroughs are filled with … well … anything and everything you can imagine really. But in particular these boroughs are full of people! Some nine million of us, give or take. People, and roofs. There is lots and lots and lots (and lots) of roof space here, and it’s just begging for us to put some solar panels on all of them!
Yes begging! Installing a solar power system in NYC means some serious cash coming your way to reduce the up-front costs, and some serious savings year, after year, after year. Let’s take a look.
New York’s Renewable Portfolio Standard
New York has an adequate, but by no means trend-setting Renewable Portfolio Standard. The state is required to derive at least 22.5% of it’s electricity from renewable sources by the year 2020. That’s pretty good, but we’ve seen higher. California, for instance, is aiming for 33% by 2020. So while 22.5% is good enough, it’s going to have to come up a bit if we really want to be forefront of environmentally friendly energy policy.
2% of the renewable energy used to meet the RPS’s goals must come from solar. That’s also solid, especially in a landscape that too often lacks solar carve-outs altogether. But given how clean and efficient residential solar systems are, the solar minimum should be raised even more.
If the RPS’s numbers aren’t hit, the utility companies get penalized with fees, so enforcement shouldn’t be too big of a problem. If there’s one thing that gets a utility company’s attention it’s cutting into their profit margin.
New York Solar Power Rebates
New York has an excellent state solar power rebate program to help reduce your initial costs. For every kilowatt of solar power you install, the state will cut you a rebate check of $1,750. The maximum solar rebate is either $12,500 or 40% of your total costs, whichever is less. For a typical 5kw system like the one we look at below, you’ll get $8,750 back from the state. A lot of top-notch solar installers will even take the solar panel rebate off your out of pocket price so you don’t have to wait around for that check to come in the mail. Ask your installer if they can do this for you when you get one of your free quotes.
New York Solar Power Tax Credit
Get this. In addition to that rebate, you also get a sizable solar power tax credit! Usually it’s one or the other –either a rebate or a tax credit– but not both. But in New York you get to double up. This time you get back 25% of your total installation costs or $5,000, whichever is less. Combining the solar power rebate and tax credit, your maximum possible discount from the state is now an absurd $17,500, or 65% of your costs.
Just remember to file tax form IT-255 to receive the credit!
Your shiny new solar power system adds value to your home: about 20 times your annual electricity bill savings. With the high prices of electricity here, that’s going to be a whole lot. We already know what you’re thinking, but fear not! That increase in value is 100% exempt from property taxes.
What’s more, the purchase and installation of your solar power system is also 100% exempt from state and local sales tax. You know, that extra 8.875% you usually pay on everything here?
Con Ed’s New York City service area currently pays 18.6 cents per kilowatt hour of electricity. That’s comfortably above the state average of 16.83 cents/kwh, and way above the national average of 11.43 cents/kwh. To put this in perspective, if NYC were its own state, the electricity prices here would be second highest in the nation, behind only Hawaii.
Right now you probably cringe when you think of those rates because it means a high electric bill. What you should be seeing is opportunity! Those high energy rates make this one of the most economically efficient places in the country to switch to solar power and help us get off fossil fuels!
Net Metering and Interconnection
Net metering makes your utility track your energy production and consumption. When you use less energy than your solar power system produces, you get the surplus back! Your net excess generation (NEG) in a given month is credited to the your next bill at Con Ed’s current retail rate. At the end of each annual billing cycle, Con Ed will cut you a check for all the built-up NEG at the avoided-costs rate, i.e., the retail rate at the time you ran the surplus (not the retail rate at the time the check is cut).
The only thing that’s missing from New York’s net metering law is a higher capacity limit. Under the current 1% (of production) capacity limit, you may have trouble getting onto the grid if too many people in your area have already taken advantage of the net metering program. We’d like to see that capacity limit come up to 5%.
Aside from the capacity limit, you shouldn’t have too much trouble connecting to the grid in NYC, because the rest of the interconnection standards are very customer friendly. Your small residential system qualifies for a simplified process that makes it easy to get on the grid; no external disconnect switch is required; and you don’t need to carry any of your own liability insurance.
Example 5kW (5000 Watt DC STC) Solar System Return on Investment in New York City
So just how fast does solar pay for itself in NYC? Let’s see:
Installing a typical 5kW solar system should run you $25,000, give or take a bit depending on the local market. That sounds like a lot, but just wait till you see how fast it drops …
- First we calculate the state solar power rebate. You’re getting $1,750 a kilowatt and you installed 5 kilowatts, so we subtract $8,750 for a new price of $16,250.
- Next we save money with the state tax credit. That’s another $5,000 off the price, for a new total of $11,250.
- The federal solar tax credit gets calculated after state rebates, so we take 30% of our $16,250 and subtract another $4,875. Your total cost is now just $6,375. We told you it was going down fast!
- Finally we subtract your annual electricity savings of $1,088 for a final cost after year 1 of $5,287. You’ve already paid for nearly 80% of your solar power system!
- You can expect your solar power system to pay for itself in a remarkably fast 5 years. And that’s witha conservative estimate of future electricity prices!
- Oh btw. While you were celebrating all that money saved, your home value just went up by a cool twenty large. And remember – all of that $21,762 is tax exempt.
- On top of all that green in your wallet, your new solar power system is also like a bunch of green for the earth! All that clean solar energy you’re producing is equivalent to planting 103 trees this year!
These numbers are estimates. Your home is different from everyone else’s and your return on investment in a solar power system could be more or less than what we calculated. Don’t fret. We’ve got some partners in the area that we trust. Just fill out the form below and grab a free quote or three, and our expert installers can help you determine exactly how much money solar can save you.
The consensus on New York City solar power rebates and incentives
New York City is at the forefront of a lot of things and we’re proud to say that solar power incentives are one of them. Almost no one offers both state solar power rebates and state tax credits. By doing so, New York helps residents pay what well may be the lowest year-1 costs in the nation. Between those minuscule start-up costs and high energy prices, the payback timeframe in NYC rivals Hawaii for tops in the nation. That’s highest marks by any standard.
Our older archived New York City Solar Power costs and savings breakdown images for reference: