Average Cost of Solar Panels in New York: What to Expect (2022)
New York is among the states with the highest electricity prices, but this also means you can achieve major savings on your power bill by going solar. In this article, we’ll analyze the cost of solar panels in New York and provide an overview of the incentive programs locally available.
We discuss average New York solar costs below, but pricing can change significantly based on your individual home and your energy needs. If you want to know how much switching to solar could cost — and how much it could save you on high New York energy bills — you can use this tool or fill out the form below for a free quote for your home.
All EcoWatch solar companies are pre-vetted for your convenience.
How Much Do Solar Panels Cost in New York?
Based on market research and data from top solar brands, we have found that the average cost of solar panels in New York is $2.95 per watt, which is far above the national average of $2.66 per watt. Although solar panel costs in New York are above the U.S. average, the corresponding savings are also increased due to the high electricity prices.
The Energy Information Administration reports an average electricity cost of 20.46 cents/kWh for residential consumers in New York, 44% above the national average of 14.19 cents/kWh. This is bad news if you get all your electricity from the grid, but great news for those looking to switch to solar power. Since electricity is expensive, the cost savings when generating your own power is also higher.
When installing a 5-kW home solar system in New York, you can expect a cost of $10,927 after the 26% federal solar tax credit is applied. New York also offers a 25% state tax credit that reduces the net cost to $8,048. In the following table we have summarized the typical prices of some popular system sizes before and after the federal incentive:
|Size of Solar Panel System||Cost of Solar Panels in New York||Cost After Federal Tax Credit|
These average solar costs are useful as reference, but keep in mind prices vary depending on roof conditions and the specific solar brands used in your project. You can also cut installation costs if you qualify for other incentives beyond the 26% federal tax credit.
What Determines the Cost of Solar Panels in New York?
We have provided the average cost of going solar in New York, considering several system sizes that are most common. However, an accurate quote is only possible with a professional assessment of your specific roof conditions and electricity bills. In general, homes with higher energy consumption need larger systems, which come with an increased price tag.
Aside from energy consumption habits, some key factors that determine solar costs include the equipment chosen, the solar installer hired and how the system is financed. Also, keep in mind that a basic installation with only solar panels is more affordable than a larger system with panels and a solar battery.
Solar panels tend to look similar from brand to brand, but their costs vary depending on the features offered. In general, monocrystalline panels are the most efficient solar panels, but this comes at a higher price. On the other hand, polycrystalline panels are more affordable, but they generate less electricity per square foot covered. You can identify the type of solar panel by its color: mono solar cells are black, while poly solar cells are blue.
Photovoltaic panels are the most visible part of a home solar system, but other components are necessary to connect them with your home appliances. For example, the inverter converts the direct current (DC) power generated by solar panels into the alternating current (AC) power needed by your home’s appliances, and the inverter brand chosen also affects the final price. The same can be said of other components such as the racking system and electrical protections.
There are also optional features for solar power systems, which increase the final price if you include them. For example, if you want a battery system to store solar electricity for use at night, it can add more than $10,000 to your total investment.
The cost of a solar panel system also depends on how you decide to pay for it. The three most common options are paying in cash, getting a solar loan, and signing a solar lease or power purchase agreement (PPA).
- Paying in cash for a home solar system results in the lowest possible cost, since you avoid interest and other monthly payments. However, this option is only possible if you have the funds available. A 5-kW solar system will cost you around $14,767 in New York, although you can claim $3,840 back on your next tax declaration.
- With a solar loan, you can split the investment into smaller and more manageable payments. This means you can use power bill savings to cover loan payments, and you’re essentially going solar with no out-of-pocket costs. However, the total amount paid for your solar system will be higher once you factor in interest payments.
- A solar lease or PPA consists of using panels that are owned by a solar provider but are installed in your property. The provider is responsible for installation and maintenance costs, and you pay a monthly fee to use the system for an agreed length of time. A lease typically charges you a fixed fee, while a PPA charges you a variable fee based on electricity output. Homeowners who choose this option typically pay a power bill as well, so if you’re signing a lease or PPA, double check that your monthly total will actually be less than your current utility bills.
When deciding how to pay for your solar power system, keep in mind that all incentives go to the legal owner. The system belongs directly to you when paying in cash or using a loan, but it belongs to the provider when signing a lease or PPA, so you won’t be able to claim any tax credits or rebates if you go this route.
Other than equipment and financing costs, the installed price of a solar power system also includes skilled labor. As a result, the price depends on the solar company hired for the job. To ensure professional workmanship, you should look for an installer that has technicians certified by the North American Board of Certified Energy Practitioners (NABCEP). Most of the best solar companies will fit this bill.
We also recommend comparing several solar quotes instead of signing a contract with the first company you contact. You may find lower prices, higher-quality solar equipment, a longer warranty or other benefits. Also, keep in mind that choosing a local installer rather than a national brand can provide technical support more easily if you need it in the future.
If you’re wondering how much it will cost to hire a local installer and get your solar system up and running, you can use this tool or fill out the form below to connect with a trustworthy solar provider in your area.
All EcoWatch solar companies are pre-vetted for your convenience.
New York Solar Incentives
New York offers several incentive programs for solar power systems. Many owners can achieve a solar payback period under five years as a result. We have another article with a detailed explanation of solar incentives in New York, but you can check the following table for a quick summary:
|New York Solar Incentive||How it Affects the Cost of Solar Panels in New York|
|Solar Energy System Equipment Credit||New York offers a state tax credit when going solar that’s equivalent to 25% of your system costs, up to a maximum of $5,000. This benefit is calculated before the federal tax credit is applied. After both are applied, you’ll see a combined savings of 45.5%.|
|NY-Sun Megawatt (MW) Block Incentive||Depending on their location in the state of New York and the type of building, solar power systems can qualify for upfront cash rebates from the NY-Sun incentive program.|
|New York Solar Sales Tax Exemption||When purchasing a solar panel system in New York, you aren’t charged the sales and use tax.|
|Net Metering in New York||New York requires net metering by law, which means power companies give you full credit for the surplus solar generation that is sent to the grid.|
|Local solar incentives||Other than the statewide incentives, additional benefits may be available from your city, county or utility company. Make sure you do some quick research about local incentives before installing solar panels.|
|Federal solar tax credit||Solar power systems in the U.S. are eligible for a 26% tax credit, which can be combined with local incentives. In the case of New York, there is also a 25% state tax credit.|
FAQ: Cost of Solar Panels in New York
Is it worth going solar in NY?
Yes, it’s generally worth going solar in New York. Solar panels can achieve a payback period of fewer than five years in the state but last for more than 25 years. New York’s electricity prices are among the highest in the U.S., and solar costs are greatly reduced thanks to a combination of incentives. You get a 25% state tax credit in addition to the 26% federal tax credit, and you may qualify for a rebate from the NY-Sun program.
What is the average cost of solar panels in NY?
You can expect to pay around $2.95 per watt for solar panels in New York. This translates to $14,767 for a 5-kW system. However, federal and state tax credits give you a large chunk of this amount back in less than a year. This reduces the net cost to only $8,048.
How much do solar panels cost for a 2,000-square-foot house?
Based only on square footage, the ideal capacity of a home solar system cannot be estimated accurately. To provide an accurate quote, solar installers need to check your monthly power bills and roof conditions.
Are solar panels free in New York?
Currently, there are no incentive programs that offer free solar panels in New York.
Leonardo David is an electromechanical engineer, MBA, energy consultant and technical writer. His energy-efficiency and solar consulting experience covers sectors including banking, textile manufacturing, plastics processing, pharmaceutics, education, food processing, fast food, real estate and retail. He has also been writing articles about energy and engineering topics since 2015.