As a resident of Rockland or Orange County, you might have an interest in harnessing the environmental and economic benefits of solar panels. However, you might have come across rumors suggesting that getting started could incur high costs, potentially imposing restrictions. Fortunately, the solar panel installation cost in NY is largely up to you. The amount you pay now and later down the road depends on how you choose to finance the investment.
Purchasing Solar Panels
When you purchase your solar array outright, the panels and the energy they produce are entirely yours. You own the installation from day one and can choose how you use it. Be conservative to sell excess electricity back, maximizing cost-effectiveness through net metering.
- Upfront costs: Purchasing solar panels has the highest upfront cost because there’s no financing involved. Still, the quoted price and what you actually pay could be far different if you qualify for solar incentives and tax credits.
- Lifetime costs: Avoid financing and you avoid paying interest and fees over the life of your solar panels. In this way, purchasing solar panels is the fastest way to achieve the greatest savings possible.
Leasing Solar Panels
If you decide to lease solar panels, you sign an agreement usually lasting 20 years. The solar panels are installed with no money down. The leasing option allows you to expand your solar array in the future at a discounted price. Rest assured your system is guaranteed for 25 years, making the decision to lease a low risk proposition.
- Upfront costs: Leasing is a way to get started with $0 down. This makes installing solar panels a viable option for people who don’t have a huge savings account built up.
- Lifetime costs: You pay a fixed monthly rate to lease the solar panels and cover any maintenance and monitoring costs along the way. This rate – plus any residual energy costs the solar panels don’t cover – is usually significantly less than what you paid on your monthly electric bills prior to going solar. Still, because you’re gradually paying off the full solar panel installation cost in NY, you end up saving only about half as much money in the long run as purchasing the panels outright.
Taking Out a Solar Loan
With this option, you finance your solar installation with a 5- to 20-year loan. Finance the full cost of solar panel installation in NY, starting without upfront payments. As with purchasing, you have full ownership of your panels; you’re simply paying them off gradually at a fixed monthly rate. If you have a good financial month and want to make a larger payment, you can do so without a prepayment penalty.
- Upfront costs: Just like leasing solar panels, a loan enables you to get started with $0 down. But as with purchasing, you can also take advantage of solar incentives and tax credits, bringing the total solar installation cost down.
- Lifetime costs: Interest on the solar loan increases the amount you pay overall, but you still enjoy excellent savings compared to skipping solar completely.
Qualifying for Solar Incentives and Rebates
For outright purchases and loans, you have the opportunity to take advantage of solar incentives and rebates. Find out what you qualify for. If you can’t take full advantage of the savings, leasing solar panels could be a simpler option.
- Federal tax credits: Until 12/31/2016, gov offers 30% tax credit with no limit to incentivize solar energy. Existing homes and new construction qualify, but you need to own your home. Both principal residences and second homes qualify.
- New York State tax incentives: NY residents may qualify for a 25% tax credit (up to $5,000) on total system cost. You may also be exempt from state sales tax if you make an outright purchase. 15-year property tax exemption for solar panel installations may apply, reducing higher taxes on increased home value.
- Renewable Energy Certificates: You can sell excess energy from your solar array to power companies that are required to obtain a portion of their electricity from renewable sources using RECs. This lowers the lifetime cost of owning solar panels.
- New York State Energy Research and Development Authority incentives: NYSERDA provides cash incentives for qualifying solar arrays on a first-come, first-served basis.
Clearly, the solar panel installation cost in NY varies greatly depending on what upfront and lifetime costs you hope to achieve. Working with an installer is the best way to calculate the ideal purchasing route for you.
