New York Solar Incentives, Cost & Payback (2026)
Written by Aditya Patil · Last updated 2026-09-24
New York remains one of the strongest solar markets in the US, buoyed by high electricity rates, solid NY-Sun rebates, and the fact that full retail net metering is still available for residential rooftops.
$169
Avg. monthly bill
29.49¢/kWh
Avg. rate
$4.26/W
Real installed cost
LBNL Tracking the Sun
9 yrs
Est. payback
typical household
How much does solar cost in New York?
Based on public data from Lawrence Berkeley National Laboratory (LBNL), the median installed cost for a residential solar system in New York is $4.26/watt. The typical system size in the state sits at 8.4 kW, mapping to a gross cost of roughly $37,960 prior to any tax credits or rebates. (Note: $4.52/watt for the typical system varies slightly from the overall median).
If we model a system for an average New York household consuming 6,887 kWh annually, it would require about a 5.45 kW array. At state-average pricing, the gross cost is approximately $23,216. With the federal tax credit ending after 2025, you can still deduct up to $5,000 through the NY State Solar Equipment Tax Credit, bringing the net estimate down to $18,216.
Traditional Rooftop Solar
Retail net metering means grid exports are credited 1:1, so self-consumption rates don't heavily impact your savings.
$2,031 / yr
9-year payback · $69,237 over 25 years
State Incentives & Tax Credits
New York offers robust support for going solar, most notably through the NY-Sun initiative and state-level tax benefits.
| Program | Amount | Status |
|---|---|---|
| New York State Solar Energy System Equipment Tax Credit | 25% of qualified solar energy system equipment expenditures, capped at $5,000. Non-refundable; unused credit carries forward up to 5 years. | open |
| Real Property Tax Law Section 487 -- Solar, Wind, and Energy Storage Systems Exemption | 100% exemption of the increase in a property's assessed value attributable to installing a solar (or wind, micro-hydro, fuel cell, or electric energy storage) system, for a period of 15 years. | open |
| NYC Solar Electric Generating System (SEGS) Property Tax Abatement | For systems that commence service between January 1, 2024 and January 1, 2035: an abatement equal to 7.5% of eligible installation cost per year for 4 years (up to ~30% of cost total), capped each year at the lesser of that percentage, the property's actual annual property tax bill, or $62,500. | open |
| NY-Sun Residential Solar Incentive | NYSERDA states the incentive amount 'depends on project size and location' and that incentives 'are structured to phase out over time as more New Yorkers install solar and the market becomes more robust.' NYSERDA also offers an enhanced 'Affordable Solar' incentive for households under roughly 80% of area median income. UNVERIFIED IN THIS PASS: the current $/W block rate by utility territory (Con Edison vs. PSEG Long Island vs. upstate utilities) is published by NYSERDA on a live, interactive incentive/rate dashboard rather than a static page, and could not be read by this research pass -- do not publish a specific $/W figure until that dashboard is checked directly. | open |
| NYSERDA Residential Solar Financing (On-Bill Recovery Loan / Smart Energy Loan) | Low-interest financing for residential solar (and related efficiency/storage) projects, arranged through NYSERDA's selected statewide lender network (Energy Finance Solutions). In eligible utility territories, repayment can be made via an On-Bill Recovery charge on the customer's utility bill; otherwise a standard unsecured loan applies. Exact current interest rate is set by the lender network and quoted per applicant via NYSERDA's online interest rate estimator -- not a single fixed published rate. | open |
| NYSERDA Home Energy Storage Incentive | Incentive amount per kWh 'varies by region and changes over time' per NYSERDA; NYSERDA states a residential project can receive 'several thousand dollars of funding.' UNVERIFIED IN THIS PASS: the exact current $/kWh rate by utility territory is shown on NYSERDA's live Residential Storage Incentive Dashboard, which is an interactive tool this research pass could not read -- do not publish a specific $/kWh figure until that dashboard is checked directly. | open |
Sales tax: Full exemption from New York State sales and use tax on the purchase of residential solar energy systems equipment and the service of installing it, under Tax Law Section 1115(ee). Local (county/city) sales tax is a SEPARATE decision: under Tax Law Section 1210, a county, city, or school district must affirmatively elect by local law to extend the exemption to its local sales tax -- the default if a jurisdiction has not elected is that local sales tax still applies to solar equipment/installation even though state sales tax does not.
Net Metering in New York
New York has one of the more complex solar compensation structures in the country, but the bottom line for individual homeowners is good: traditional Net Energy Metering (NEM) is still available.
The state uses a framework called the Value of Distributed Energy Resources (VDER), which calculates the real-time value of solar exports to the grid. VDER is mandatory for community solar subscribers. However, residential rooftop solar owners can currently still opt for traditional full-retail NEM, allowing them to trade kWh with their utility roughly 1:1.
| Policy | Net Energy Metering (NEM) |
| Alternative Option | VDER Value Stack (mandatory for Community Solar) |
| Export credited at | Full retail rate for traditional NEM |
| Governing Body | New York Public Service Commission (PSC) |
UNCERTAIN / FLAGGED: We could not find a primary-source page from DPS or NYSERDA this session that states an explicit residential system-size cap (kW) for NEM eligibility, or that definitively confirms whether any NY utility has since required new mass-market residential rooftop customers onto VDER by default (rather than NEM-with-a-VDER-option) in a more recent order than the original 2017 Value Stack order under Case 15-E-0751. DPS's live case document list for 15-E-0751 shows 2,116+ filed documents, and we were not able to browse that document list (it requires interactive filtering) to confirm the most recent residential-class ruling. Treat the 'NEM remains available for individual rooftop solar' finding as accurate as of the DPS Clean Energy Initiatives summary page accessed 2026-09-24, but verify against the newest order in Case 15-E-0751 before publishing a hard claim about system-size thresholds or an expiration date for NEM eligibility.
Electricity Rates by Utility
Solar savings are closely tied to your utility's electricity prices. Here is a look at residential rates for major providers in New York:
| Utility | Residential rate | Customers |
|---|---|---|
| Consolidated Edison Co-NY Inc | 35.66¢/kWh | 2,715,069 |
| Niagara Mohawk Power Corp. | 17.22¢/kWh | 1,430,208 |
| Long Island Power Authority | 24.57¢/kWh | 1,029,943 |
Battery Storage Programs
NYSERDA Home Energy Storage Incentive
NYSERDA's statewide residential battery storage incentive, funded as part of NY's broader energy storage program. Incentive is paid per kWh of installed capacity, varies by region/utility territory, and phases down over time similar to NY-Sun's solar block structure. Higher incentive tiers exist for income-eligible households and state-designated Disadvantaged Communities. Long Island customers (PSEG Long Island territory) must pair storage with solar; other regions can access standalone storage incentives. Current $/kWh rates are published on a live NYSERDA dashboard, not a static page.
Check Your Specific Numbers
System size and expected payback fluctuate depending on your home's energy footprint. Plug your own data into our solar calculator for a tailored estimate.
FAQ
Does New York still have net metering?
Yes, for individual residential rooftop systems. While New York has a complex "Value of Distributed Energy Resources" (VDER) framework that applies to community solar and commercial projects, everyday homeowners installing panels on their own roof can still choose traditional Net Energy Metering (NEM), earning full retail credit for the excess electricity they send to the grid.
What is the NY State Solar Equipment Tax Credit?
It is a non-refundable state tax credit equal to 25% of your qualified solar equipment expenditures, up to a strict cap of $5,000. If your tax liability isn't large enough to use the full credit in year one, you can carry the unused portion forward for up to 5 years.
Are solar panels exempt from sales tax in New York?
State sales tax, yes. New York fully exempts residential solar equipment and installation labor from the 4% state sales tax. However, local (county and city) sales taxes are a separate matter. Municipalities must explicitly opt in to extend the exemption locally. If they haven't, you will still pay local sales tax.
Data sources
Last updated 2026-09-24
- U.S. Energy Information Administration — Electricity Data Browser — accessed 2026-09-24
- NREL PVWatts — accessed 2026-09-24
- NREL Solar Resource Data — accessed 2026-09-24
- LBNL Tracking the Sun (public data file, host-owned residential systems) — accessed 2026-09-24
Written by Aditya Patil