Solar Panels in New York: 2026 Costs, NY-Sun Incentives, and the Post-Federal-Credit Math

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Last updated: 2026-07-30

The bottom line first: New York remains one of the stronger states to go solar in 2026, but the reason has changed. The federal 30% tax credit that used to anchor solar payback math nationwide ended for systems installed after December 31, 2025. What's left in New York is unusually good by comparison to most other states — a 25% state tax credit up to $5,000, a NY-Sun rebate that lowers your quoted price before you even apply for anything, a sales tax exemption, a 15-year property tax exemption, and net metering that still credits exported power close to the retail rate. Stack those together and New York homeowners are still looking at solid paybacks even without the federal piece. Here's how the numbers actually work.

What Changed: The Federal Credit Is Gone

For over a decade, the Section 25D federal residential clean energy credit gave every homeowner in the country a 30% credit against the cost of a solar system, regardless of what state they lived in. That credit expired for systems placed in service on or after January 1, 2026. If your New York installation goes live this year or later, that 30% isn't part of your math. If you already had a system installed and placed in service before the cutoff, your existing credit and any remaining carryforward are unaffected.

This matters more in some states than others. In a state with no state credit and no rebate program, losing the federal 30% removes almost the entire incentive stack. New York isn't that state — it has its own layered incentives that were always separate from the federal credit, and those are still standing.

The New York State Solar Tax Credit

New York's residential solar tax credit is a state-level credit equal to 25% of your installed system cost, capped at $5,000, claimed against your New York State income tax liability. Unlike the expired federal credit, this one is unaffected by anything happening at the federal level — it's state law, funded and administered separately.

A few practical points on how it works:

• It applies to the cost of the system after any NY-Sun rebate is subtracted, not the pre-rebate sticker price.
• If your tax liability in the year you install is smaller than your credit, New York allows you to carry the unused portion forward to future tax years, similar to how the old federal credit worked.
• You claim it using New York State's solar energy system equipment credit form when you file, and your installer or tax preparer should be able to walk you through the paperwork — this isn't something you need a specialized tax attorney for.

On a system that costs $24,000 installed, a $5,000 state credit is a meaningfully bigger dent than it sounds like at first glance, especially now that it's the largest single financial incentive most New York homeowners will see.

NY-Sun: The Rebate That Lowers Your Quote Upfront

NY-Sun is NYSERDA's statewide incentive program, and it works differently than a tax credit — instead of getting money back at tax time, the incentive is baked into your installer's quote as a reduction on price. NY-Sun pays participating installers a per-watt incentive that they pass through to you.

The catch, and the reason it's hard to give an exact number in an article like this one: NY-Sun operates on a declining block structure. Each utility territory in the state has a funding block, and as installations in that territory use up the allocated incentive dollars, the per-watt rate steps down for the next block. Long Island, upstate regions, and the Con Edison service territory in and around New York City can all be sitting at different points in their funding schedule at the same time. Your installer will know the live rate for your specific address — it's not something worth guessing at, because it changes.

What doesn't change is the mechanism: NY-Sun reduces your price before incentives and taxes are calculated, so it's stacking on top of, not instead of, the state tax credit.

Sales Tax and Property Tax Exemptions

Two more New York incentives that are easy to overlook because neither shows up as a check or a credit — they show up as taxes you simply don't pay:

Sales tax exemption. New York exempts residential solar energy equipment from the state's sales tax. On a $24,000 system, that's real money that never gets added to your invoice in the first place.

Property tax exemption. Adding solar panels increases your home's value, and normally that would mean a higher property tax assessment. New York's 15-year exemption excludes that added value from your assessment, so your property taxes don't go up because you installed solar. Most municipalities in the state participate in this exemption automatically, but a number of localities have opted out over the years, so it's worth a two-minute call to your town or city assessor to confirm before you assume it applies to you.

Net Metering: How Your Export Credit Actually Works

New York has been shifting larger and newer commercial-scale solar projects toward a Value of Distributed Energy Resources (VDER) compensation framework, which is more complex and reflects time-of-day and locational value rather than a flat credit. For the vast majority of homeowners installing a standard residential rooftop system, though, net energy metering is still what applies: when your panels produce more than your home uses, the excess flows back to the grid and you earn a credit against future usage, generally valued close to the retail rate you'd otherwise pay.

The practical upshot is that a well-sized New York system, matched reasonably closely to your annual usage rather than dramatically oversized, still earns close to full value for the power it exports. Ask your installer to show you the specific net metering tariff for your utility — National Grid, Con Edison, NYSEG, RG&E, Central Hudson, and PSEG Long Island each administer their own program details even though the underlying state framework is the same.

What Solar Actually Costs in New York Right Now

Before incentives, New York system pricing tends to run slightly above the national average, generally in the $2.80–$3.60 per watt range, reflecting higher labor costs in the state compared to national norms. A typical 7-9 kW system sized for an average single-family home lands most homeowners in the $22,000–$30,000 range before incentives.

After the state tax credit, sales tax exemption, and whatever NY-Sun rebate applies in your utility territory, that net cost typically comes down substantially — often into a range comparable to, or better than, what homeowners in states with no state-level incentives were paying even when the federal credit was still available.

A few things move New York pricing specifically:

Roof age and snow load. New York roofs need to handle real snow load, and installers factor that into racking and mounting choices. If your roof is more than 10-15 years from needing replacement, get a roofer's opinion before you sign a solar contract — pulling panels off early to redo a roof is an avoidable expense.

Downstate versus upstate labor costs. Installation pricing in the New York City metro, Long Island, and the lower Hudson Valley tends to run higher than upstate regions like Buffalo, Rochester, or Syracuse, driven mostly by labor and permitting costs rather than equipment.

Tree cover. New York's older suburban neighborhoods often have substantial mature tree canopy, and shading from trees you don't control can meaningfully cut production even on a well-installed system. A proper site assessment, not a satellite-only estimate, should identify this before you sign.

Getting an accurate number for your specific roof, usage, and utility territory requires an actual quote rather than a statewide average. Compare quotes from vetted installers through EnergySage — it puts competing New York installers in a bid against each other on one form, so you can see how the state credit, NY-Sun rebate, and exemptions actually net out for your address before you commit to anyone.

Affiliate Disclosure: This article may contain affiliate links. If you make a purchase through these links, we may earn a small commission at no extra cost to you. We only recommend products we genuinely believe in. This helps support our work and allows us to continue providing free content.

Backup Power for New York's Winter Storm Risk

New York's grid is more reliable overall than states dealing with wildfire-driven shutoffs or hurricane-force wind exposure, but it isn't immune to outages — nor'easters, ice storms, and heavy lake-effect snow events regularly knock out power across upstate New York and the Hudson Valley, sometimes for days at a time in harder-hit counties.

A standard grid-tied solar system, the kind most New York homeowners install, does nothing during a grid outage by design — inverters shut down to protect utility workers on the lines, regardless of how sunny it is. If backup power during a winter storm outage matters to you, that has to be planned for separately from the solar system itself.

For a household that wants to keep a refrigerator, sump pump, WiFi, and some lighting running through a multi-day outage without the cost of a full home battery, the EcoFlow DELTA Pro is sized for that load and can recharge from solar panels directly, which matters if the outage drags on and grid power isn't the only option. For a smaller household or a single critical circuit like a sump pump or medical equipment, the Jackery Explorer 2000 Plus covers the essentials at a lower price point and is easy to store in a closet until you need it.

Affiliate Disclosure: This article may contain affiliate links. If you make a purchase through these links, we may earn a small commission at no extra cost to you. We only recommend products we genuinely believe in. This helps support our work and allows us to continue providing free content.

Neither is a replacement for a full whole-home battery if that's within your budget, but both do something a battery addition to your solar contract often can't do quickly: they work the same week you buy them, independent of your installation timeline.

The Bottom Line for New York Homeowners

The federal tax credit going away changes the math everywhere, but New York was never relying on it alone. Between the 25% state tax credit capped at $5,000, the NY-Sun rebate reducing your price upfront, the sales tax exemption, the 15-year property tax exemption, and net metering that still pays close to retail for exported power, New York homeowners going solar in 2026 are working with one of the stronger state incentive stacks left in the country. The number that actually matters is what all of that nets out to for your specific roof and utility territory — and that only comes from a real quote, not a statewide average.

Compare New York solar quotes through EnergySage to see what the state credit, NY-Sun rebate, and exemptions actually save you before you sign anything.

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Want to go deeper on the pieces that matter most for New York homeowners?

• Is Solar Still Worth It in 2026 Now That the Federal Tax Credit Is Gone?
• Net Metering by State: Which Markets Still Pay Retail Rate
• The 72-Hour Home Outage Sizing Guide

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