New York Solar Incentives & Rebates (2026)
New York offers a 25% state tax credit (up to $5,000), NY-Sun rebates of $0.20-$0.40 per watt, property tax exemptions, and sales tax exemptions—yielding combined incentives of $8,000-$12,000 for typical residential systems.
New York stands out as the nation’s most incentive-rich solar state, combining federal tax credits with aggressive state programs. The NY-Sun Initiative distributes $2.3 billion to reduce soft costs and improve access to solar across residential, commercial, and non-profit sectors. State tax credits, utility rebates, and property/sales tax exemptions create a multi-layered incentive structure that accelerates payback to 6-8 years.
Federal Solar Investment Tax Credit (30% ITC)
The federal solar investment tax credit covers 30% of total installation costs for systems installed through December 31, 2032. For a typical $30,000 residential system, this represents a $9,000 tax credit. Unlike rebates or deductions, the ITC applies directly to your federal income tax liability. The credit is non-refundable but can be carried forward to subsequent tax years.
To claim the ITC, file Form 5695 with your federal tax return in the year your system achieves operational status. Systems installed in 2026 can claim the full 30% credit.
New York State-Specific Solar Programs
New York State Solar Tax Credit (25%, up to $5,000)
Residential customers claim 25% of system costs as a state tax credit capped at $5,000. A $25,000 system generates a $5,000 credit. Commercial systems receive 25% credits with higher caps ($25,000). The credit applies to equipment and installation labor but excludes financing costs. Credits must be claimed in the year system is placed in service.
NY-Sun Rebate Program ($0.20-$0.40 per watt)
Residential rebates range from $0.20 to $0.40/watt depending on geographic incentive levels and contractor network participation. A typical 6 kW system receives $1,200-$2,400 in NY-Sun rebates. The program explicitly targets underserved communities, with enhanced rebates in disadvantaged areas.
Property Tax Exemption (STAR Program Integration)
New York exempts solar equipment from property tax assessments under the STAR (School Tax Relief) program framework. A $28,000 system avoids approximately $420-$560 annually in property taxes over 25 years ($10,500-$14,000 in lifetime savings).
Sales Tax Exemption on Solar Equipment
New York exempts solar panels, inverters, batteries, and installation labor from the state sales tax (4%) and local surtaxes (up to 4.875%). The exemption saves $1,400-$1,800 on typical installations.
Net Metering for Residential Systems
New York mandates net metering for systems under 25 kW at retail rates. Excess generation is credited at your utility’s average retail rate, with annual true-up settlements. Credits rolling over to the next billing year are compensated at avoided cost rates (typically $0.03-$0.05/kWh).
Utility-Specific Rebate Programs in New York
Consolidated Edison (Con Edison) Distributed Solar Program
Residential customers in Brooklyn, Queens, Westchester, and Orange counties receive incremental rebates of $300-$600 beyond NY-Sun when capacity allows. Current waitlist estimated at 6-8 weeks.
NYSEG (New York State Electric & Gas) Solar Rebate
Residential customers across central and southern New York receive $1,000-$1,500 rebates paired with NY-Sun incentives. NYSEG’s solar installers network has processed over 18,000 residential systems since 2014.
Rochester Gas and Electric (RG&E) Community Solar Credit
Residential customers unable to host on-site solar can receive 10-12% credits on electric bills through community solar participation.
Solar Incentive Summary Table for New York
| Incentive Type | Details | Typical Value (6 kW System) |
|---|---|---|
| Federal ITC (30%) | Non-refundable tax credit through 2032 | $5,400-$7,200 |
| State Tax Credit (25%) | Capped at $5,000 residential | $4,500-$5,000 |
| NY-Sun Rebate | $0.20-$0.40/watt | $1,200-$2,400 |
| Property Tax Exemption | STAR program integration | $10,500-$14,000 (25-year) |
| Sales Tax Exemption | 4% state + local surtax | $1,400-$1,800 |
| Net Metering | Retail rate for under 25 kW | $600-$2,000/year |
Frequently Asked Questions About New York Solar Incentives
Can I use both the NY-Sun rebate and the state tax credit on the same system?
Yes. NY-Sun rebates (federally funded) and the state tax credit are separate incentives stacked on the same installation. You can receive $1,200-$2,400 in NY-Sun rebates plus claim a $5,000 state tax credit in the same year. Combined with the 30% federal ITC, total incentives can reach $13,000-$18,000.
Does the $5,000 state tax credit mean I need $20,000 in NY state income tax?
No. The credit is refundable in most cases, meaning you can receive the benefit even if your state tax liability is lower than $5,000. You may need to file Form IT-276 and adjust your tax return, but the credit does not require matching income tax liability.
How does New York’s net metering compare to other states?
New York’s retail-rate net metering for under 25 kW systems is among the nation’s best. Excess credits roll over monthly with annual settlements at retail rates. The only limitation is that credits exceeding 12 months are compensated at avoided cost rates ($0.03-$0.05/kWh) rather than retail.
Is the NY-Sun program running out of funding?
NY-Sun has distributed over $1.8 billion since inception with $2.3 billion budgeted through 2030. Funding availability remains strong, though incentive levels adjust quarterly based on utilization. Residential incentives have been stable at $0.20-$0.40/watt for the past 12 months.
Start Your New York Solar Journey
Solar incentives are substantial in 2026, but they evolve regularly. Federal tax credits decrease by 2 percentage points annually after 2032, making 2026-2032 the optimal window.
Connect with qualified solar installers in New York through EnergyRanked’s solar installer directory. Our network includes pre-vetted, licensed professionals familiar with state incentives and application procedures.
For detailed information about the federal tax credit, consult our comprehensive solar tax credit guide. Return to our parent solar incentives hub to compare New York programs with other states.