2023 Solar Incentives Guide for Ontario, NY - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Ontario.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Ontario?
State of NY Commercial PACE Financing Program
Residential Solar Tax Credit
Refundable Clean Heating Fuel Tax Credit (Corporate)
NY-Sun Loan Program
Small Business and Not-for-Profit Organizations:
Participation Loans: up to $100,000 (at low interest rate)
On-Bill Recovery loans: $50,000 at 2%
Residential Wood Heating Fuel Exemption
Local Option - Solar Sales Tax Exemption
Solar Sales Tax Exemption
Local Option - Real Property Tax Exemption for Green Buildings
Energy Conservation Improvements Property Tax Exemption
Local Option - Solar, Wind & Biomass Energy Systems Exemption
NY-Sun PV Incentive Program (Residential, Low-Income, and Small Business)
Long Island Region: $0.00/W (MW blocks have been fully subscribed)
Con Edison Region: $0.30/W
Upstate Region: $0.35/W
Low-to-Moderate income customers: $0.80/W (up to 10 kW)
Small Commercial (Non-Residential): Long Island Region: $0.00/W (MW blocks have been fully subscribed)
Con Edison Region: $0.60/W
Up State Region: $0.45/W
Multifamily Affordable Housing Adder: additional $0.40/W (up to 50 kW)
Ground Source Heat Pump Rebate Program
Large Systems (> 10 cooling tons): $1,200/cooling ton
Home Performance with ENERGY STAR
NY Green Bank
Refundable Clean Heating Fuel Tax Credit (Personal)
On-Site Wind Incentive Program
Tier II: 10,000 kWh - 125,000 kWh of expected annual energy production: $1.00/annual kWh
Tier III: 125,000 kWh - 1,000,000 kWh of expected annual energy production: $0.30/ annual kWh
Tier IV: Greater than 1,000,000 kWh of expected annual energy production: $0.15/ annual kWh
These incentives are additive.
Anaerobic Digester Gas-to-Electricity Rebate and Performance Incentive
- Capacity Incentive: Varies on the construction and design of the system
- Performance Incentive: $0.025/kWh production payment for new systems for up to 10 years (estimated using a capacity factor of 75%)
- Interconnection Incentive: up to 75% of the costs exceeding $5,000
- Project Enhancement Incentives: Available for Black Start Capability, Hydrogen Sulfide reduction, design for accepting food waste and others
Federal Residential Renewable Energy Tax Credit
Solar incentives are intended to encourage people to switch their home over to renewable energy by offering financial incentives meant to lower the burden of solar panel installation and use. You may qualify for different kinds of incentives, such as discounts, cash back or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of New York and others from the federal government. Types of solar incentives might include:
- Tax Credits: Tax credits decrease, dollar-for-dollar, the total amount of tax you owe the government. These differ from tax deductions.
- Tax Exemptions: These might come in the form of property tax exemptions, which allow you to ignore the value of your solar system when calculating the taxes you pay on your house. They may also include exemptions on sales tax at the time of purchase.
- Net Metering: Net metering becomes relevant once your solar system is up and running. If you have a net metering agreement in place with your Ontario utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in others you might receive a refund equivalent to a percentage of the value.
- Rebates: Solar rebates might be provided by your local utility company, or by your county or state. These rebates are essentially partial refunds that are applied after you purchase a solar system and before tax credits are calculated.
Federal Solar Incentives
Federal solar incentives are likely the first thing that you think of when thinking about solar incentives. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit equal to a predetermined percentage of the money you spend on solar panels for your home.
The ITC originally covered 30% of the cost of installing a solar system, and has fluctuated slightly over the last few years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The cost of installation includes the panels themselves as well as the cost of accessories, equipment and labor. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.
Talking to your local Ontario solar panel installer is the best way to understand how the ITC could apply to you.
In August 2022, the Inflation Reduction Act made revisions to the ITC, now called the Clean Energy Credit. Homeowners are now eligible for a credit of 30% of the total solar system installation costs for projects that began after January 1, 2022 and will be finished by the end of 2032. This percentage will then begin to decrease on a yearly basis until the Clean Energy Credit expires in 2035. Starting in 2023, the program expansion will also make it easier to get credit for energy storage systems.
More information about the new Inflation Reduction Act can be found here. The best way to understand how the new Clean Energy Credit will apply to you is to get in touch with your local Ontario solar panel installation expert.
State & Local Solar Incentives
Tax credits, rebates and more can be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. These incentives might be handled by your county or municipality, or by the New York government. Certain incentives are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Ontario
Nationwide solar energy use has gone up tremendously in the past 15 years, in part thanks to the increase in availability of solar incentives. You may get these incentives from your local utility company, the New York government or the federal government. When you're ready to make the switch to solar energy, getting in touch with your local Ontario solar panel installation expert is an excellent place to start.
EcoWatch's Ontario, NY Solar Incentives FAQs
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.