Financial Incentives for Residential Solar Investments
(New York & Federal)
Investment in Renewable energy is supported at the Federal, State and Local levels. The Federal Business Energy Investment Tax Credit (ITC) currently offers a Federal tax credit equal to 30% of the cost of the solar system, including installation. The rate of 30% will drop to 26% beginning in 2020.
Each State has their unique set of incentives, especially when combined with the additional incentives offered by a particular municipality. Below we list the solar investment incentives for the State of New York and New York City
NY-Sun Incentive: The NY-Sun Initiative provides “cash-rebate” incentives for installing solar electric systems. Incentives are distributed through 3 regions: Con Edison, PSEG Long Island, and the Balance of the State.
Long Island Region: closed
Con Edison Region: $0.30/W
Up State Region: $0.35/W
Under the Megawatt Block incentive structure, each region and sector (commercial vs residential) is assigned a series of MW targets at certain incentive levels, referred to as “blocks.” As applications are submitted, incentives are assigned and the kW associated with the applications are added together and the units are converted to MW. When the MW target for that block is reached, the block is closed and a new block, with a new target and a lower incentive level, is started. Once all of the blocks for a particular region and sector are filled, an incentive for that region and sector will no longer be offered
New York State Tax Credit:
Residential building owners who install solar may be eligible for a tax credit for the lesser of 25% of the installed cost of the solar energy system (up to 25 kW on net-metered systems) after the NYSERDA incentive, or $5,000. Be advised that the federal government considers this state tax credit taxable income
NY State Sales Tax Exemption:
The law exempts the sale and installation of commercial solar energy systems equipment from state sales taxes, and allows municipalities and cities to exclude these costs from local sales tax.
New York City Property Tax Abatement (PTA):
Building owners who place a grid-connected solar energy system into service from January 1, 2014 through January 1, 2019 are eligible for a four-year Tax Abatement of 5% per year of the installed cost of the system for 4 years (total of 20%). Abatements are capped at $62,500 per year or $250,000 total, applied after the NY-Sun rebate.