New York's solar economics in 2026 are genuinely good — not despite the expired federal credit, but because the state's own programs remain strong enough to compensate. The 25% state income tax credit (max $5,000), the NY-Sun Megawatt Block rebate, and Con Edison's high retail rates combine to support 8–11 year payback periods for NYC homeowners. That's competitive with most states that had the federal credit.
Disclaimer: All cost and savings estimates use Lawrence Berkeley National Laboratory Tracking the Sun 2024 cost data and EIA Electric Power Monthly 2025 rate data. Section 25D residential solar credits expired December 31, 2025. Get at least three installer quotes before deciding.
Key Takeaways
- A typical 9 kW New York system costs ~$28,800 at $3.20/watt — after NY-Sun rebate ($2,700) and 25% state credit ($5,000), net cost drops to ~$21,100
- NYC averages 4.5 peak sun hours/day and Con Edison charges $0.290/kWh — among the highest retail rates in the U.S.
- Con Edison’s Value of DER export rate pays only $0.05–$0.10/kWh — right-size your system to consumption, not for export
- NY state 25% solar tax credit (New York Tax Law §606(g-1)) carries forward up to 5 years if your tax bill is less than $5,000
New York Solar Costs in 2026
New York is an expensive solar market — $3.20/watt puts it above the national median. A 9 kW system in New York costs approximately $28,800 before incentives. That sounds steep until you apply what's actually available: the NY-Sun Megawatt Block rebate (roughly $0.30/watt, or $2,700 applied as a direct price reduction) and the 25% state income tax credit (capped at $5,000).
After those two programs: Net cost ≈ $21,100. That's a real number you can work with.
| System Size | Gross Cost at $3.20/W | After NY-Sun Rebate ($0.30/W) | After 25% State Credit (max $5,000) |
|---|---|---|---|
| 7 kW | $22,400 | $20,300 | ~$15,300 |
| 9 kW | $28,800 | $26,100 | ~$21,100 |
| 11 kW | $35,200 | $31,900 | ~$26,900 |
The 25% state credit calculation: 25% × $26,100 = $6,525 — but the $5,000 cap applies. Unused credit (up to $1,525 in this example) carries forward for up to 5 additional tax years.
How NY-Sun Megawatt Block Works
NY-Sun is a NYSERDA program that pays a per-watt incentive to your solar installer, who is required to pass it to you as a direct price reduction — not a tax credit you wait months to receive. The current residential rate varies by utility territory and available block capacity, ranging from approximately $0.20–$0.40/watt.
According to NYSERDA's program data, NY-Sun has incentivized over 180,000 solar installations across New York state. Rates decline as each block fills, so earlier applicants receive better per-watt incentives. Get your application in before available capacity sells through.
Con Edison and the Value of DER
Con Edison doesn't use traditional net metering. Instead, it uses the Value of Distributed Energy Resources (Value of DER) tariff, which compensates solar exports at a calculated "value" that includes avoided generation, capacity, and environmental costs. In practice, Value of DER rates run approximately $0.05–$0.10/kWh — far below Con Edison's retail rate of about $0.290/kWh.
This gap is critical to understand before sizing your system. Every kWh you export earns roughly $0.07, while every kWh you consume directly saves $0.29. The ratio is approximately 4:1 in favor of self-consumption.
Practical rule for Con Ed customers: Size your system to cover approximately 80–90% of your annual consumption. Don't oversize for export — it actively hurts your ROI.
| Scenario | 8 kW System — NYC (4.5 sun hrs) | Annual Benefit |
|---|---|---|
| 100% self-consumption at $0.290/kWh | 10,500 kWh × $0.290 | ~$3,045/yr |
| 70% self-use / 30% export at Value of DER | 7,350 kWh × $0.290 + 3,150 × $0.07 | ~$2,352/yr |
| Oversized: 50% self / 50% export | 5,250 × $0.290 + 5,250 × $0.07 | ~$1,890/yr |
Upstate New York vs. NYC
The solar economics change significantly once you leave the five boroughs. Upstate utilities — National Grid, RG&E, NYSEG — offer traditional retail-rate net metering rather than Con Edison's Value of DER structure. That's better for export value. But upstate New York averages only 3.8–4.2 peak sun hours per day (Buffalo is lower than NYC), and electricity rates run $0.18–$0.22/kWh versus ConEd's $0.290/kWh.
Estimated payback for upstate homeowners runs 10–13 years — longer than NYC but still within the 25-year panel lifespan. The NY-Sun rebate and 25% state credit apply regardless of utility territory.
What to Do Next
Check NY-Sun block availability in your utility territory.
NYSERDA publishes current incentive levels by utility territory on the NY-Sun program page. Rates decline as blocks fill. Knowing the current per-watt incentive before installer conversations ensures you negotiate from accurate numbers.
Pull your last 12 months of Con Edison bills.
Total your annual kWh usage. Your installer should size your system to cover 80–90% of that number — not more. Oversizing in Con Ed territory lowers your ROI because Value of DER export rates are roughly 4× less valuable than direct self-consumption.
Run your ROI estimate before any installer meetings.
New York’s combination of high rates, significant state incentives, and the Value of DER export structure makes the math more nuanced than a simple payback calculation. Use real inputs — your actual rate, annual usage, and roof orientation — to get a defensible number.
Get at least three quotes from NY-licensed installers.
New York has a competitive installer market, and NY-Sun requires installers to be certified. EnergySage and SolarReviews both operate in New York. Multi-quote data shows 15–20% average savings versus going with the first installer you meet.
See your New York payback in one minute
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Thinking about adding a battery? Under Con Edison’s Value of DER structure, storing midday solar for evening use captures significantly more value than exporting. Our Battery Storage Calculator models the payback on a Powerwall or equivalent system at your specific rate.
Bottom Line
New York solar in 2026 is one of the better markets in the U.S. despite the expired federal credit. Con Edison's $0.290/kWh rates mean every kWh of self-consumed solar is extraordinarily valuable. The 25% state credit (up to $5,000) plus the NY-Sun rebate cut a typical 9 kW system from $28,800 to roughly $21,100. For NYC homeowners with south-facing roofs and 8+ year time horizons, the case is strong. Con Ed's Value of DER export structure requires careful system sizing — don't oversize.
Related Guides
- Solar Panel Cost by State in 2026 — See how New York compares to every other state for costs and incentives.
- Is Solar Worth It in 2026? — National payback analysis to put New York’s numbers in context.
- Net Metering Guide 2026 — How Con Edison’s Value of DER compares to traditional net metering.
- Home Solar Panels: The Complete 2026 Guide — Everything you need to know before getting your first solar quote.
