New York has the most comprehensive state solar support structure in the contiguous U.S. right now — and it matters more than ever since Section 25D expired. The combination of the NY-Sun rebate (paid directly to your installer) and a 25% state income tax credit (up to $5,000) can take a $28,800 system down to roughly $19,300 net cost. The catch: Con Edison's Value of DER (VoD) export rate is not full retail, and upstate vs. NYC solar economics are meaningfully different.
Disclaimer: Cost estimates are based on Lawrence Berkeley National Laboratory's Tracking the Sun 2024 report and NREL PVWatts data. NY-Sun rebate rates change as program blocks fill — confirm current rates with NYSERDA. Electricity rates from EIA Electric Power Monthly. Get at least three installer quotes before deciding.
Key Takeaways
- A 9 kW New York system costs ~$28,800 gross; NY-Sun rebate ($0.20–$0.40/W) plus 25% state tax credit (max $5,000) can cut net cost to ~$19,300
- New York electricity averaged $0.236/kWh in 2025 (EIA) — high rates significantly improve solar bill-offset value
- Con Edison's Value of DER export rate is ~$0.02–$0.10/kWh, not full retail — self-consumption matters more than oversizing
- NYC vs. upstate sun hours differ substantially: 3.9 hrs/day (upstate average) vs. 4.5 hrs/day (NYC metro)
- NY-Sun funding is block-based and limited — earlier applications get better per-watt rebate rates
What Does Solar Cost in New York in 2026?
New York is among the more expensive installation markets nationally. High labor costs, dense permitting requirements (especially in NYC), and higher-wage electrician labor all push costs above the national median. According to Lawrence Berkeley National Laboratory's Tracking the Sun 2024 report, the New York median sits at approximately $3.20/watt installed.
| System Size | Gross Cost at $3.20/W | Annual Production (est.) | Notes |
|---|---|---|---|
| 6 kW | $19,200 | ~9,100 kWh/year | Smaller home, low usage (upstate sun hours) |
| 8 kW | $25,600 | ~12,100 kWh/year | Average NY single-family home |
| 9 kW | $28,800 | ~13,600 kWh/year | Higher usage or modest EV charging |
| 11 kW | $35,200 | ~16,700 kWh/year | Large home or significant EV charging |
Production estimates use 4.2 peak sun hours per day (upstate/average). NYC metro and Long Island average closer to 4.5 peak sun hours. See NREL's PVWatts Calculator for ZIP-code-level estimates.
New York Solar Incentives in 2026
New York stacks multiple incentive programs. Here's how each one works and what it's worth in real dollars.
NY-Sun Megawatt Block Rebate (NYSERDA)
The NY-Sun Megawatt Block program pays a per-watt incentive to your installer, who is required to pass it to you as a direct price reduction. This is not a tax credit — you don't need to file anything. The rebate reduces your invoice price upfront.
Current residential NY-Sun rates (2026, varies by block and utility territory):
| Utility Territory | Approximate Rebate Rate | Value on 9 kW System |
|---|---|---|
| ConEdison (NYC, Westchester) | ~$0.20–$0.30/W | $1,800–$2,700 |
| NYSEG | ~$0.20–$0.35/W | $1,800–$3,150 |
| RG&E | ~$0.20–$0.40/W | $1,800–$3,600 |
| National Grid | ~$0.20–$0.35/W | $1,800–$3,150 |
| Central Hudson | ~$0.20–$0.30/W | $1,800–$2,700 |
NY-Sun rates decline as block capacity fills. Earlier applicants get better rates. Confirm the current rate in your territory with NYSERDA's program tracker or with your installer before committing.
25% New York State Income Tax Credit (Max $5,000)
Under New York Tax Law Section 606(g-1), homeowners can claim a 25% state income tax credit on solar installation costs, up to a maximum credit of $5,000. This is a credit (not a deduction), meaning it reduces your NY state tax bill dollar-for-dollar.
On a $28,800 system: 25% = $7,200, capped at $5,000. If your state tax liability is less than $5,000, the unused portion carries forward for up to 5 additional tax years.
Stacked Net Cost Example (9 kW System)
| Step | Amount |
|---|---|
| Gross system cost at $3.20/W | $28,800 |
| NY-Sun rebate (~$0.30/W average) | -$2,700 |
| After NY-Sun rebate | $26,100 |
| 25% NY state tax credit (max $5,000) | -$5,000 |
| Net cost to homeowner | ~$21,100 |
Note: sales tax exemption on solar equipment also applies in New York — this can save an additional $2,000–$2,500 on a system this size, though it depends on whether your installer charges sales tax (residential solar systems are typically exempt).
Understanding Con Edison's Value of DER Export Rate
If you're a Con Edison customer — which covers most of NYC and Westchester County — it's critical to understand that Con Edison does not use traditional net metering. Instead, it uses the Value of DER (Distributed Energy Resources) tariff, which compensates exported solar at a rate that reflects the avoided cost of grid energy, capacity, and distribution costs.
The VoD rate is substantially below full retail price. In practice, Con Edison export credits run approximately $0.02–$0.10/kWh depending on the time of day — versus the retail rate of $0.25–$0.30/kWh you'd pay to buy that electricity back.
This has the same practical implication as NEM 3.0 in California: oversizing your system in Con Edison territory is not financially rational. Every kWh you export earns a fraction of what it would cost you to buy it back. Size your system to cover ~80–90% of your annual consumption.
Outside Con Edison territory (upstate New York), many utilities still offer traditional net metering at closer to retail rates. Check with your utility before sizing your system.
NYC vs. Upstate: How Different Are the Economics?
The differences are real but not as dramatic as you might expect, because higher Con Edison electricity rates partially offset lower upstate sun exposure.
| Region | Peak Sun Hours/Day | Avg Electricity Rate | 8 kW System Annual Savings (est.) | Payback (after incentives) |
|---|---|---|---|---|
| NYC / Long Island (ConEd) | 4.5 | $0.28–$0.32/kWh | $2,200–$2,800 | 8–10 years |
| Westchester / Hudson Valley | 4.2–4.5 | $0.22–$0.28/kWh | $1,900–$2,400 | 9–11 years |
| Albany / Capital Region | 4.0–4.5 | $0.20–$0.25/kWh | $1,700–$2,200 | 9–12 years |
| Buffalo / Western NY | 3.8–4.2 | $0.18–$0.22/kWh | $1,500–$2,000 | 10–13 years |
Payback estimates assume NY-Sun rebate and 25% state credit applied. NYC benefits from higher electricity rates and Con Edison's high demand charges; upstate benefits from lower install costs and better retail net metering terms in some territories.
NYSERDA Additional Programs
Beyond NY-Sun, NYSERDA administers several other programs relevant to electrification:
- NY Green Bank — financing for clean energy projects, including solar loans
- Clean Energy Communities — for local governments, not homeowners directly, but can affect local permitting policies
- EmPower+ (income-qualified) — free energy efficiency upgrades for income-qualified homeowners that can reduce your baseline load before you size a solar system
Also worth noting: New York's NY Accelerated Renewable Energy Growth and Community Benefit Act (CLCPA implementation) continues to support grid-level renewable development, which affects the long-term structure of utility rates and export compensation.
Is Solar Worth It in New York in 2026?
For most New York homeowners with a south-facing roof and moderate-to-high electricity bills: yes, particularly in Con Edison territory where electricity rates are high and the state incentives are accessible.
Solar works well in NY if:
- You're in Con Edison territory with $0.28+/kWh rates
- You have a straightforward south-facing roof with minimal shading
- You have NY state tax liability to absorb the $5,000 credit
- You plan to stay in the home for 8+ years
Solar is harder to justify in NY if:
- You're in deep upstate New York with lower sun hours, lower rates, and shading issues
- Your roof faces north or has significant shading from trees or adjacent buildings
- Your NY state tax liability is under $2,500 (limits the tax credit benefit)
Use the Solar ROI Calculator to model your specific numbers. If you're weighing whether to buy or use a PPA, the Solar Lease vs. Buy vs. PPA Calculator is worth running.
Bottom Line
New York is one of the best solar states in the country right now — not because of sunshine (it's in the bottom third), but because of its stacked incentive programs and high electricity rates. The NY-Sun rebate reduces upfront cost immediately, the 25% state tax credit provides a meaningful annual tax reduction, and rates of $0.25+/kWh mean each kWh your system produces is genuinely valuable.
Con Edison's VoD export rate is the one caveat — right-size your system rather than oversizing. But within those parameters, New York solar payback of 8–11 years is achievable without any federal credit.
Related Guides
- Is Solar Worth It in 2026? — National payback analysis including how New York compares to other high-incentive states.
- Solar Panel Cost by State in 2026 — See how New York's incentive stack compares to every other state.
- Net Metering Guide 2026 — Full explanation of Con Edison's Value of DER tariff and how it differs from retail net metering.
- Solar Panel Financing Guide 2026 — How to finance solar in New York using loans, leases, and PPAs after the expiration of Section 25D.
