As a solar data analyst and long-time NY resident, people often ask me: can I really save money with solar panels in New York?
With some of the highest electricity rates in the continental US, it‘s a fair question…
After crunching the numbers for over 5 years though, I can definitively say: yes, solar pays off for most New Yorkers!
In this guide, I‘ll walk you through everything you need to know:
- Upfront purchase costs and available incentives
- Expected savings over the 25-year lifespan of a system
- How your specific home can find the optimal solar panel setup
I‘ll also equip you with handy savings calculators and cost tables tailored specifically to NY residents.
Let‘s dive in!
New York ranks 4th nationally for solar energy
With over 5,200 MW of solar power connected to the grid as of 2022, New York trails only California, Texas and Florida for total solar capacity.
To put the growth in perspective:
| Year | NY Solar Capacity |
|---|---|
| 2016 | 890 MW |
| 2021 | 4,400 MW |
| 2022 | 5,200 MW |
(Source: SEIA Solar Spotlight New York)
That‘s nearly 6X growth in only 6 years! And it‘s set to expand even faster…
NY‘s aggressive sustainable energy targets
Part of the reason New York has seen such solar expansion is due to state clean electricity standards requiring:
- 70% renewable energy by 2030
- 100% zero-emissions energy by 2040
To meet these goals, analysts expect over 50,000 additional MW of solar power over the next 15 years.
With plenty of open space on rooftops and in fields ideal for solar farms, the state is ripe for residential growth.
(Source: NY State Energy Plan 2022)
In other words, New York is serious about rapidly transitioning to solar energy!
What does it cost to install solar panels in New York?
Now, let‘s tackle the big question: how much are homeowners paying to go solar these days?
On average across New York:
Solar Panel Equipment & Installation:
- $2.86 per Watt
- $17,160 for typical 6,000W (6kW) residential system
However, with the federal tax credit and additional state incentives, out-of-pocket costs drop significantly lower, as we‘ll cover shortly.
First, let‘s break down what goes into that initial price tag…
Full 6kW solar installation cost components
| System Components | Typical Cost |
|---|---|
| Solar panels | $8,500 |
| Inverters | $2,500 |
| Racking & wiring | $1,850 |
| Permits & inspection fees | $900 |
| Installation labor | $2,200 |
| Total Before Incentives | $16,950 |
You‘ll also pay sales tax on solar purchases in New York:
Sales Tax on $16,950 system:
$16,950 x 8% NY tax rate = $1,356
Total Initial 6kW System Cost:
$16,950 equipment + $1,356 tax = $18,306
But again – that cost gets reduced through incentives next.
First though, let‘s make sure a 6 kW system is properly sized for your needs…
Right-sizing a solar system in New York
One tip for maximizing solar savings is matching your system size to your home‘s electricity appetite.
Let‘s use Buffalo, NY to walk through an example:
Average Buffalo, NY home electricity usage:
- 30 kWh/day
Average peek sun hours per day in Buffalo:
- 4.4 hours
Recommended solar system size:
30 kWh/day ÷ 4.4 sun hours = 6.8 kW
For a Buffalo homeowner, a 6.8 kW system would offset the most electricity from the grid, providing maximum bill savings.
You can lookup sun hours and use an online calculator to right-size your own system at this link.
Oversizing solar panels risks higher upfront costs without additional energy savings upside. But you also lose savings potential by undersizing!
Factors impacting NY solar costs
Within New York, average solar pricing can swing over $1.00 per Watt across different regions, equipment needs and installer choices.
Key variables include:
Geographic Location
- Southern NY regions receive more sun exposure, cutting size/costs
- NYC for example averages 4.6 daily peak sun hours
Solar Panel Types
- Monocrystalline: Most efficient, best for cloudy weather
- Polycrystalline: Affordable, lower efficiency
- Thin-film: Cheapest option, efficiency varies widely
Installer Selection
- Reliable, experienced installers may cost more
- Quotes far below $2.86/W could indicate equipment or labor issues
Let‘s compare an installer quote scenario across panel types:
| Monocrystalline | Polycrystalline | Thin-Film | |
|---|---|---|---|
| Equipment Cost | $16,000 | $14,000 | $12,000 |
| Installation | $5,500 | $5,500 | $5,500 |
| Total Cost (Pre-Incentive) | $21,500 | $19,500 | $17,500 |
Monocrystalline panels carry about a 15% higher price tag in this case, but also provide 18-25% more energy annually in New York‘s dim weather.
Thin-film panels are cheapest upfront, but efficiency and performance vary widely in cloudy conditions like those across New York.
Now let‘s explore how incentives can help cut costs…
New York state incentives make solar more affordable
Beyond the federal solar tax credit refund of 30% off system costs, New York offers a suite of additional incentives:
New York State Tax Credit
- 25% of system costs, up to $5,000
Sales Tax Exemption
- Waives state sales tax on solar purchase
Net Metering
- Bill credits for sending excess solar electricity to grid
Solar Panel Property Tax Exemption
- Added home value from solar not taxed
NY-Sun Incentives
- Up to $1,000 per kW installed capacity
Let‘s see how these save a homeowner money with a 6 kW solar installation:
| Cost Category | Amount | Incentives |
|---|---|---|
| Equipment + Install Labor | $16,950 | Federal: $5,085 tax credit State: $4,238 tax credit |
| Sales Tax | $1,356 | 100% exemption |
| Total Initial Outlay | $18,306 | – |
| Total After Incentives | – | $8,983 |
Bottom line: Over $9,300 in instant savings, nearly half the original cost!
The NY Solar Calculator lets you estimate incentives for your property.
Next let‘s look at electricity bill savings…
Lifetime electricity savings from going solar
The incentives help ease the burden of purchasing a solar array. But where homeowners really start saving is slashing their monthly electricity bills over the 25+ year lifespan of their panels.
Let‘s use our 6 kW example to estimate lifetime savings potential:
Over 25 years, a 6 kW solar system produces about 150,000 kWh of electricity from the sun.
For a household paying $0.20 per kWh for grid electricity (NY average), that solar electricity would‘ve cost $30,000!
Instead, you pay $0 for homegrown sunlight from your panels after paying off the post-incentives system cost early on.
Factoring in annual panel degradation around 0.5%, electricity savings tally to:
Total 25-Year Savings from 6 kW Solar:
|$29,686 |
Subtract out the post-incentive equipment purchase price to get net lifetime savings:
|$20,703|
Most solar panels in New York last at least 25-30 years. So that nearly $21,000 goes straight to your family‘s pocket rather than the utility!
When do solar panels "pay themselves off"?
Another way homeowners consider the investment is simple payback period…
That‘s the time it takes your solar panel system to pay itself off in electricity savings.
For our example 6 kW system costing a post-incentive $8,983, the payoff math looks like:
|$8,983 system cost ÷ $1,187 annual savings = 7.6 years|
|-|-|
With incentives, solar panels pay for themselves in 7-8 years on average. Then 16+ years of nearly free electricity from the sun!
Certain zip codes and municipalities even offer additional rebates beyond this baseline scenario.
For instance, [[ supporting link ]]:
- New York City: up to an extra 20% credit off system cost
- Ossining, NY: $250 per kW installed
So payback timelines around 5-6 years are possible in the most generous areas.
Nice work if you can get it!
Going solar: costs vs. long-term savings in NY
Let‘s summarize everything into a quick rundown of average costs for solar panels in New York state:
|| Initial 6kW Purchase | Post-Incentives Outlay | Lifetime Savings | Payoff Time |
|-|-|-|-|-|
|Base | $18,306 | $8,983 | $29,686 | 7-8 years |
|With Local Rebates | $17,000 | $5,500 | $29,686 | 5-6 years |
As you can see, while solar power requires an upfront investment on your end, the incentives coupled with 25+ years of free sunlight add up to five-figure financial savings in the long run.
And that‘s money staying right in your pocket rather than getting mailed off to the utility company each month!
Frequently Asked Questions
How much sunlight is required for solar panels in New York?
Most regions of New York average between 3.5-4.5 peak sun hours per day annually, with cities in the south seeing up to 30% more sunlight exposure. Modern solar panels can still produce ample energy even with low or inconsistent sunlight. Choosing equipment rated for efficiency in cloudier conditions is recommended in New York to maximize savings based on your location.
What incentives are best to reduce solar costs in New York?
stacking both the 30% federal tax credit along with New York‘s 25% state tax credit (up to $5k) provides the biggest upfront price cut. Waiving sales tax and securing additional local utility or municipal rebates drop net out-of-pocket costs even lower.
Should I buy vs lease solar panels in New York?
Purchasing solar panels has become the far better option economically with current incentives. Buying unlocks tax credits and rebates that make systems affordable. And direct ownership provides full bill savings over the 25-year lifespan versus leases charging ongoing monthly fees.
How long will solar panels really last in New York‘s weather?
Engineers conservatively rate solar panels as retaining at least 80% productivity at the 25-year mark, with many units exceeding 30+ years. Cold weather or snow does not damage properly installed panels. Quality racking equipment can handle heavy snow loads in winter. Ensure your solar installer provides warranties and equipment rated for long-term durability.
What tax breaks are offered for installing solar in New York?
The federal solar tax credit allows you to deduct 30% of your solar equipment and installation costs directly from your income tax bill. New York also offers a 25% state income tax credit up to $5,000. Together, these provide thousands in upfront relief when purchasing panels in addition to waived sales taxes and long-term property tax exemptions on solar systems.
I hope this guide has shown that with the right incentives and proper solar sizing, systems can pay for themselves in under 10 years for many New Yorkers. And you‘ll continue reaping free sunlight benefits for decades after that!
If you have any other questions, don‘t hesitate to ask in the comments or connect with me on Linkedin.
To your solar savings!
