Cost of Solar, Financing, Lease Options

How much does solar energy cost?Cost of Solar, Financing, Lease Options

An average residential solar system can cost between $15,000-$29,000 for average sized systems sized between 4kW and 8kW. Considering that you could possible spend up to $33,396.00 in electrical bills over the next 25 years, this can be a small price to pay for solar in New York1. However, for too many people, that still represents too large of an upfront payment. The good news is that many of the solar providers we work with offer a variety of great solar financing and leasing options to help offset some of initial solar installation costs. In addition, low interest rates may be available for a solar home financing and installing solar panels can increase the value of your home as well.

The exact cost of your solar system will depend on the applicable home solar rebates and incentives available in your area that you qualify for and the type of solar installation you chose. Using a qualified solar energy installer who is familiar with the local incentives and permitting process will ensure that you get the most from your investment.

Are there any government tax incentives or rebates?

One of the great elements of solar power in the U.S. is that there are large number of tax incentives and rebate programs that exist to make it easier to afford solar power for your home. The solar installer that you select will be up to date on all the applicable incentives based on where you live but below are some of the basics:

  • Solar Investment Tax Credit: Investment Tax Credit (ITC) allows individuals to deduct 30% of the cost of a solar system from individual federal income taxes and has helped grow residential and commercial annual solar installations by 1,600 percent since its implementation in 20062.
  • Individual State Rebates: Many states offer cash rebates that are either flat amount or are based on the size of your solar power system – check out the U.S. government’s Database of State Incentives for Renewables & Efficiency for more information on the rebates in your area;
  • Property Tax Exemptions for Residential Solar: Many state and local governments also specifically exclude the added value of a home solar energy system from your annual property taxes. There are currently 38 states offering property tax exemptions for renewable energy, reducing the financial burden on the taxpayer for installing a solar power system.3
  • Municipal and Utility Rebates: In addition to the federal and state incentives, many local municipalities and utilities may also offer incentive programs for home solar. Please check out the Database of State Incentives for Renewables & Efficiency for any qualifying solar incentives in your specific area.

What are some of the current New York solar rebates?

One of the great facts about solar in New York is that there are a number of solar rebate and incentive programs, such as the New York State Energy Research and Development Authority and the Green Residential Building Program, that exist to make it easier to afford solar power for your home.  The solar provider that you select will be up to date on all of the solar incentives and lease/finance options that may be available to you to help you save as much money as possible.
There also may be rebate and incentive programs available from major New York Utilities such as Consolidated Edison Company (ConEd), PSEG Long Island, New York State Electric & Gas (NYSEG), Central Hudson Gas Electric (CenHud), Rockland Electric Company (RECO), Niagara Mohawk Power (National Grid), Rochester Gas & Electric (RG&E), and at times from other NY municipal and county electricity providers such as Jamestown Board of Public Utilities (JBPU) and Bath Electric Gas & Water Systems (BEGWS)4.  The professional NY solar installers we connect you with can explain the various NY solar incentives that you may qualify for to save you as much money as possible on your solar system installation.

Does New York have any tax incentives to adopt solar power?

Yes. New York residents receive a tax credit for their personal state income tax equal to 25% of the net (post rebate) system cost up to $5,000. Taxpayers can qualify for this credit if they (1) purchased solar energy system equipment, (2) entered into a written agreement for the lease of solar energy system equipment, or (3) entered into a written agreement that spans at least ten years for the purchase of power generated by solar energy system equipment not owned by you. The solar energy system equipment credit is not refundable. However, any credit amount in excess of the tax due can be carried over for up to five years.5

Is New York a “net metering” state?

Yes, New York allows owners of home solar systems to net-meter, which means that you can connect your solar panel system to the utility grid and if your system produces excess electricity during daylight hours. If a home is net-metered, the electricity meter will run backwards to provide a credit against what electricity is consumed at night or other periods where the home’s electricity use exceeds the system’s output. Customers are only billed for their “net” energy use.6

If I cannot afford an upfront payment for a solar power system, are there financing options to help me?

Yes, many solar installers offer a variety of excellent solar financing options to help offset some of the initial installation costs. If you decide to go solar, a solar professional will have details on the available solar financing options, but make sure you ask about the following:

  • Home Equity Loans: borrowing against the equity of your home. This type of financing requires that you already have significant equity in your home and a good credit score7;
  • Solar Lease: leasing the solar panels for a fee over a set length of time; and
  • Power Purchase Agreement: an arrangement similar to a lease arrangement where the solar provider/installer secures funding on their own for the solar project, installs the solar system in your home/office building and then sells the electricity from the solar system to the home/building owner at a fixed contractual price for a set length of time. In a PPA, the solar company remains responsible for the operation and maintenance of the system for the duration of the agreement.8

 

Solar-New-York.org is a no-cost, no-obligation, risk-free service dedicated to providing solar estimates to anyone interested in lowering their electricity bill and going green. Start now with free solar quotes from our qualified solar providers near you by filling out our short solar quotes request form here. Get connected to the best solar companies in your area and go solar today!

 


1The average monthly electric bill in New York is $111.32 multiplied by 12 months and 25 years equals $33,396.00. Your average monthly electric bill may be different and, as a result, the amount of any potential savings may be different. https://www.eia.gov/electricity/sales_revenue_price/pdf/table5_a.pdf

2http://www.seia.org/policy/finance-tax/solar-investment-tax-credit

3http://www.seia.org/policy/finance-tax/solar-tax-exemptions

4Solar New York  is not affiliated with any of the utilities listed.

5https://www.tax.ny.gov/pit/credits/solar_energy_system_equipment_credit.htm

6http://www.seia.org/policy/distributed-solar/net-metering

7https://www.energysage.com/solar/financing/secured-or-unsecured-solar-loan/

8http://www.seia.org/research-resources/solar-power-purchase-agreements