2023 Solar Incentives Guide for Washington, NY - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Washington.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Washington?
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
The term "solar incentives" generally refers to financial incentives put in place by solar companies and the government to encourage increased use of renewable energy by making installing and using solar panels more affordable. Incentives could include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered federally, while others are offered by the state of New York or your utility company, county or municipality. Categories of solar incentives include:
- Net Metering: You may be able to sign a net metering agreement with your Washington utility company, that may apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then subtract this value from your monthly utility bill.
- Rebates: A solar rebate is a partial refund given after you've purchased your solar system. Rebates could be offered by your local utility company, your state or your county. The rebates are usually applied before calculating tax credits.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government. (This is different from a tax deduction.)
- Tax Exemptions: Tax exemptions can come in one of two forms. The first is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when paying property tax on your home.
Federal Solar Incentives
When thinking about solar incentives, federal incentives may be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC provides you with a tax credit for a set percentage of the cost of your solar system.
The ITC can be applied to the total cost of solar panel installation, including the panels themselves as well as accessories, labor and equipment. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence that you own and that is located in the United States. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.
To better understand exactly how much money the ITC could save you, talk to your local Washington solar panel installer.
In August 2022, the ITC (now called the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. The new Clean Energy Credit now runs until 2035. American homeowners can now apply for a 30% credit for solar systems that began installation on or after January 1, 2022 and will be done by December 31, 2032. This credit will then be decreased by a few percentage points every year until the date of expiration. Starting in 2023, it will also be easier to get credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. Your local Washington solar panel installation experts can answer your questions and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
In addition to federal solar incentives, there are often also state ones. Tax credits, rebates and more might be available at a more local level. Certain incentives are ongoing, while others are offered for only a limited time. Your local solar incentives might come from your county or municipality, or from the New York government.
Next Steps for Installing Solar in Washington
Solar energy use nationwide has increased enormously in the past 15 years, in part due to the increase in availability of solar incentives. You might receive these incentives from the New York government, the federal government or your local utility company. Talking to your local Washington solar panel installer is a great first step towards getting all the incentives you qualify for when you switch to solar energy.
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EcoWatch's Washington, NY Solar Incentives FAQs
What if I add solar panels to a vacation home, rental property or commercial property? Can I still qualify for incentives?
Many solar incentives apply to a property you own that is located within the United States; most secondary residences will fall into this category. There may be other solar incentives available for commercial properties, depending on the specifics. We recommend speaking with your local solar installer and/or tax professional to fully understand what incentives will apply to your specific situation.
How much can I save on my electric bill annually if I add solar panels to my Washington home?
Typically, Washington homeowners who install solar panels save approximately $887.12 per year, or approximately $16,855.25 over 20 years after making the switch.
What are the highest-rated solar panel installation companies near me?
To learn about the top solar panel installers near you, read our article on Washington's top solar panel companies.
I want to switch my appliances out for ones that are more energy-efficient. Are there any incentives I can apply for?
The recently passed Inflation Reduction Act provides a number of incentives meant to reward homeowners for making eco-friendly upgrades. Some of these incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
Can I apply for incentives both towards the initial cost of solar panels, and later as reimbursement?
The order that incentives will be applied in might vary depending on which incentives you are claiming but generally yes, you can receive multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to ensure you are claiming all the incentives you are eligible for and applying them in the correct order.
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.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.