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Westchester County, New York Solar Power for Your Home – Leases, Loans, Rebates, and Incentives

Westchester County is a place of abundant natural beauty, and home to people who love that natural beauty. Why not show the earth you care by investing in clean energy-generating solar panels for your home? Oh, and did we mention you can make thousands of dollars selling the energy your panels generate back to the electric company?

Yes, Con Ed will buy an excess energy your panels make through a process called “net metering.” When your system is producing electricity, your house gets first dibs, and the power goes directly toward reducing your usage charges. But when the sun is really shining and your panels are pumping out more than you can use, Con Ed will buy that energy from you, directly reducing the charges for an equivalent amount of electricity purchased from them.

That’s huge! So now all you have to figure out is how to pay for it, right? Well, we’re here to make the complicated process of financing a solar investment seem easy. We review the legislative policy for New York state, discover all the local and national incentives that can save you money right now, and then do some calculations based on the cost of electricity in Westchester County.

Lifetime Return For 4 Different Methods of Going Solar in Westchester County, NY

The chart above shows the money you can make over the 25-year life of a solar panel system in Westchester County, based on how you choose to pay for it. You can see that buying a system outright will make you the most money in the long term, and it might seem like the best option. But looks are a bit deceiving here. Purchasing outright requires you to put a lot of money up front, so it actually doesn’t represent the best return on your investment.

One of the other options, Leasing, means putting no money down, and seeing a very small monthly savings add up over time. With a lease, your profit will be lower because you won’t have any skin in the game. If you have a little more appetite (and money) for investment, New York offers a couple of different loan types that can cover part or all of your cost, which can lead to big returns for you over the life of the system.

Here’s some info about how each option could work for you:

 Option 1: Solar Lease

Solar leases can be really great for people who don’t qualify for a tax break or who want to incur less risk (with less reward). Here are some of the advantages of a solar lease in New York:

  • No money down
  • A monthly payment that rises by a smaller increment than electricity prices do
  • The lease is transferable if you decide to sell your house.
  • You just have to find an installer, sign on the dotted line, and then save money
  • The installer takes care of everything, including maintenance and repair

With a lease, you sign an agreement to pay a low monthly price for 20 years. The panels go up on your roof and you get all the electricity they provide, which reduces your electric bill by just about the same as your lease payment. Over time, your payment rises by a small amount (usually 2.5%), while the cost of electricity goes up by about 3.5% per year. In the last year of the lease, you’ll be saving about $552 on electricity, just for having a roof!

Here’s the other major benefit of a lease: the installation company actually owns the system, and they do all the maintenance and repairs as needed. That takes away a ton of responsibility for you, the homeowner. All you have to do is get quotes from installers in your area, sign up for the leasing program through them, and get solar for no money down! You can sign a 20-year agreement with a fixed monthly payment that will guarantee your savings long into the future. Talk about a sweet deal!

 Option 2: Smart Energy Loan with Lump-Sum Payment

This is one of the best options if you’d like to see major savings from solar and own the panels yourself. You don’t need to have tons of cash right now, because New York has a special solar loan called a “Smart Energy Loan.” You can get up to $25,000 at 3.49% interest, and you’ll sign up to pay it back over 15 years. In our example, your loan amount will be $21,500, the cost of a system minus a $1,000 New York rebate.

Here’s the important part: Because you “purchased” the solar panels (with the loan money), you’ll get the federal government’s 30% Energy Investment Tax Credit (ITC), AND the New York 25% ($5,000) tax credit. That means $11,450 in direct tax relief. This is important: PAY THE LOAN DOWN BY THAT AMOUNT. It will save you thousands in interest and reduce your payment timeframe from 15 years to less than 7. It makes your investment’s rate of return a tremendous 15.4%, which is almost double the return of an investment in the stock market, and less risky.

The first step is to get quotes from local expert installers in New York. Then, talk to them about the Smart Energy Loan option. 3.49% is an insanely low interest rate, and New York is offering it because they recognize the value of solar energy generated by citizens!

Getting a loan means you can get solar panels now and pay them off over the long-term. It will mean that your initial loan payments are a bit higher than your energy bill savings—about $70 per month. But as electric rates rise and you get closer to paying off the loan, you’ll start to see savings.

Here’s how the numbers work for a Smart Energy Loan with lump-sum repayment in Westchester County:

  • Installing a typical 5-kW solar system should start at about $22,500. Don’t worry, you’ll be able to take a loan and pay it off quickly.
  • New York has a state rebate of $200 per kilowatt of panels. That reduces your out-of-pocket cost to $21,500. That will be your loan amount.
  • The payments on a $21,600 loan with 3.49% interest over 15 years will be just about $154 per month, but you’ll be saving $84 per month on electricity. Essentially, you’ll pay $70 per month for the privilege of one day owning those panels.
  • Here’s that important part again: There’s a Federal 30% tax credit and a New York 25% tax credit based on the cost of your system. That’s $11,450. Pay the loan down by that amount! You can take the credits over two years if you don’t owe that much in taxes this year.
  • With your loan paid off in year 7, you’ll start making a big yearly profit, and every year after for the 25-year life of your system.
  • Your total profit in 25 years will be over $25,000! The rate of return on your investment will be 15.4% That’s much better than investing in an S&P 500 index fund.
  • And don’t forget… your home’s value just increased by more than $20,000, too (your expected annual electricity savings over 20 years), and thanks to New York’s property tax exemption for solar, you won’t pay taxes on any of it!

Remember: these figures are estimates. Your home is unique, and how much money solar will save you depends on that uniqueness. Thankfully, we know some experts in Westchester County. Just sign up for personalized savings estimates and one of them will be more than happy to go over all those details and help you craft a plan to get the maximum savings from a solar power system in your home. Your quote is 100% free, so go ahead and shop around… grab two or three, or five, and compare all your possible options.

 Option 3: On-Bill Recovery Loan

If you’ve got some of the cash to put down on solar in anticipation of those big tax credits, you can make a ton of money, and your loan payments won’t even exceed your energy savings. Here’s how it works:

New York has a second special kind of solar loan called an “On-Bill Recovery Loan.” Unlike the Smart Energy Loan, this program will only lend you as much money as you can pay back with bill savings. And instead of paying your loan to a bank, the fixed costs will just appear on your energy bill, and your usage will be offset by the energy your panels produce.

That means you can finance about 55% of the system cost with the loan, and the other 45% has to come from your pocket, or your brother in-law in Buffalo, or whatever you’ve got. But here’s the important thing: The tax credits at the end of the year will more than cover the money you spend.

In our example of a 5-kW solar system, the cost is $21,500. Your loan will be for $11,869, meaning you’ll have a bill of $9,631 due at installation time. When you file your taxes, you’ll be getting that same $6,450 from the Feds, and $5,000 from the state of New York. You’ll come out ahead on the year, and your loan payments will equal your electric bill savings.

And each year, when Con Ed raises rates, you’ll still be paying the same amount for you loan, meaning you’ll slowly start to come out ahead. Over the 25-year life of the system, the savings on your bill will add up to an astounding $23,779. And considering your out-of-pocket investment is 0 after the first year, the rate of return is essentially infinite. That’s HUGE!

 Option 4: Solar Purchase

Okay, so you’ve got some cash and you’re ready to buy. An outright purchase can be a good idea if you’re averse to financing. But for this option, the rate of return is actually lower, since you’re sinking a large amount of money into it now, as opposed to small amounts over time.

In this example, you’re paying the $21,500 (after rebate) cost of the system up front. You’ll get the solar tax credits, and you’ll start realizing energy bill savings from day 1. If you’re the kind of person who wants solar now and likes to pay cash for big purchases, read on:

Here’s how the numbers work for a solar purchase in Westchester County:

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  • Installing a typical 5-kW solar system should start at about $22,500. Don’t worry – the incentives available will reduce that number quickly.
  • New York has a state rebate of $200 per kilowatt of panels, which reduces your up-front costs. That system will cost you only $21,500 after this rebate.
  • At the end of the year, the federal government will give you a 30% tax credit based on the cost of your system. That’s $6,450. You can take the credit over two years if you don’t owe $6,450 in taxes this year.
  • New York will ALSO give you a humongous tax credit. 25% of costs up to $5,000. You qualify for the maximum here, so take another 5 grand off the year-1 price.
  • The electricity you’ll save in the first year of operation would have cost $1,002. That’s enough to pay for date night once a month!
  • All those savings and incentives mean the first-year cost of your 5-kW system is just $9,003.
  • With a conservative estimate of 3.5% per year for the future rise of electricity prices, your investment will be fully paid off after 9 years, and you’ll be making a profit until 2039 or later.
  • Your total profit in 25 years will be an astonishing $28,991! The rate of return on your investment will be 14%, which is much better than an investment in an S&P 500 index fund.
  • And don’t forget… your home’s value just increased by more than $20,000, too (your expected annual electricity savings over 20 years), and thanks to New York’s property tax exemption for solar, you won’t pay taxes on any of it!

Remember: these figures are estimates. Your home is unique, and how much money solar will save you depends on that uniqueness. Thankfully, we know some experts in New York. Just sign up for personalized savings estimates and one of them will be more than happy to go over all those details and help you craft a plan to get the maximum savings from a solar power system in your home. Your quote is 100% free, so go ahead and shop around… grab two or three, or five, and compare all your possible options.

Additional Information about Solar in New York

New York Solar Power Rebates

The state’s NY-Sun rebate program is moving slowly toward its final payouts, but there are still some good rebates available. Currently, you’ll qualify for $200 for every kilowatt your system is rated. That’s a cool $1,000 off a typical residential solar installation. All right, New York!

New York Tax Exemptions for Solar

New York sets the example for all other states when it comes to reducing the burdens on homeowners who want to go solar. When you pay for installation of solar panels in New York, you won’t spend a penny in sales tax.

Furthermore, New York exempts the value of your solar installation from property taxes. Numerous studies around the country have shown that homes with solar panels sell for more than homes without. The premium is about equal to the 20-year energy savings. That means a home in New York with solar panels on it will sell for about $20,000 more than one without them, and the state exempts that extra value from property taxes!

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