New York solar rebates and incentives: 2026 guide

Solar panels might seem expensive, but if you live in New York, you're in luck. Your state offers some of the most generous solar incentives in the country, helping thousands of homeowners shrink their upfront costs while locking in decades of lower electricity bills. There are multiple ways to bring down the price of going solar—and start saving sooner than you might think.

Even better? The long-term savings from reduced electricity costs typically outweigh your upfront investment. Here's how to take advantage of New York's solar incentives.

Incentives help bring solar's price tag down considerably in New York. Here are the major ones to know about:

Megawatt Block Incentive

New York’s Megawatt Block Incentive is part of the NY-Sun Initiative aimed at making solar energy more accessible. It provides an upfront dollars-per-watt ($/W) rebate for both commercial and residential solar panel systems. 

Your rebate amount depends on the size of your system, your region, and your income. Low-to-moderate income (LMI) households qualify for the Affordable Solar Residential Incentive, which provides a higher rebate amount. The incentive is declining, which means its value declines over time. 

Long Island customers used to receive $200 per kW, but the last available block closed in April 2016. As of March 2025, here's what you can expect for residential systems up to 25 kW in size:

New York Solar Energy System Equipment Credit

The New York solar tax credit can reduce your state tax bill by 25%, up to $5,000. Unlike the ITC, you don't need to purchase your solar panel system to receive this tax credit. If you enter into a written solar lease or power purchase agreement (PPA) that lasts at least 10 years, you'll still qualify.  

If you don't have enough tax liability to take advantage of the full tax credit, you can roll over any remaining credit for up to five years.

In addition to the great rebates and incentives above, New York also offers tax exemptions for solar panel systems. The solar sales tax exemption ensures that you won't have to pay a sales tax on your system, while the solar property tax exemption means you don't need to pay a higher property tax for adding solar panels to your house.

If your solar panel system is less than or equal to 25 kW in size and it's connected to the grid, you can benefit from net metering, one of the best solar panel incentives available in New York. With net metering, you earn credits when you send excess electricity from your solar panels to the grid. When the sun isn't shining and you need to pull electricity from the grid, your utility will apply the credits to your bill. Net metering makes it so you will owe very little, or even nothing, on your electric bills with solar panels. 

New York is transitioning from net metering to the Value of Distributed Energy Resource (VDER), also known as the Value Stack. It’s currently in phase two, but you can still choose net metering or VDER in 2025. 

The VDER tariff is based on five key factors: the locational-based marginal pricing (LBMP), capacity (ICAP), environmental value (E), demand reduction value (DRV), and locational adders (LSRV). If this sounds confusing, that's because it is. The easiest way to see your expected VDER tariff is by using New York State Energy Research and Development (NYSERDA)'s free Value Stack Tariff calculator.

Due to its complexity, the VDER tariff rate is a lot less predictable than net metering. In most cases, you'll save a lot more over 20 years by signing up for net metering while it lasts instead of the VDER tariff. As of March 2025, any solar panel system interconnected in New York can lock in net metering for 20 years. 

Since 2022, you have to pay a capacity-based Customer Benefits Contribution (CBC) charge each month with a solar panel system. The charge is higher for net metering customers than for VDER tariff customers, but it's still usually best to sign up for net metering. Here's how much the CBC will cost you for a residential solar panel system in 2025:

*The VDER tariff is not available to LIPA customers.

New York doesn't offer any state-specific battery incentives for residential systems. In New York, batteries can help protect you from blackouts and provide more energy independence.