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New York State Tax Incentive Opportunities

Background

New York State has sales tax exemptions, property tax abatements and personal tax credits to encourage residential installation of energy savings measures, onsite renewable generation, solar and wind renewable energy systems and using alternative fuel for residential space heating and hot water heating.

Eligible onsite generation systems such as wind, solar, biomass, fuel cells, must be grid connected and net metered to qualify for tax incentives.


Net Metering in New York State

Net metering is available on a first-come, first-served basis to customers of the state's major investor-owned utilities, subject to technology, system size and aggregate capacity limitations.

Publicly-owned utilities are not obligated to offer net metering; however, the Long Island Power Authority (LIPA) offers net metering on terms similar to those in the state law. Below is listing of the system size limitations, organized by technology and eligible sector:

Solar: 25 kW for residential, 2 MW for non-residential

Wind: 25 kW for residential, 500 kW for farm-based, and 2 MW for non-residential

Biogas: 500 kW (farm-based only)

Micro-CHP and Fuel Cells: 10 kW (residential only)

Tax Incentives Table

Category  Eligibility Products  Tax Credit Amount 
Sales Tax Exemption Passive Solar Space Heat, Solar Water Heat, Solar Space Heat, Photovoltaic 100% State sales tax exemption. The exemption does not apply to solar pool heating or other recreational applications.
Property Tax Incentive Equipment Insulation, Water Heaters, Furnaces , Boilers, Heat pumps, Central Air conditioners, Programmable Thermostats, Energy Mgmt. Systems/Building Controls, Caulking/Weather-stripping, Duct/Air sealing, Building Insulation, Windows, Doors, Solar Water Heat, Photovoltaic, Wind, Biomass, Geothermal Heat Pumps 100% of the value added to 1, 2, 3 or 4 family homes. The exemption includes general municipal property taxes, school district taxes, and special ad valorem taxes, but does not apply to special assessments.
Property Tax Incentive Passive Solar Space Heat, Solar Water Heat, Solar Space Heat, Solar Thermal Electric, Solar Thermal Process Heat, Photovoltaic, Wind, Biomass, Solar Pool Heating, Daylighting, Anaerobic Digestion 100% exemption for 15 years installed before 7/1/1988 or between 1/1/1991 & 12/31/2014. This is a local option exemption where local governments are permitted decide whether or not to allow it.
Property Tax Incentive Solar photovoltaic systems located in New York City 8/5/2008 to 12/31/2010: 8.75% per year for 4 years (total of 35%)
1/1/2011 to 12/31/2012: 5% per year for 4 years (total of 20%)
Personal Tax Credit Biodiesel for residential space heating or hot water production within New York State. $0.01/gallon for each percent of biodiesel $0.20/gallon
Personal Tax Credit Grid connected and net metered Solar Water Heat, Solar Space Heat, Photovoltaic, Fuel Cells for Residential, Multi-Family Residential 25% for solar-electric (PV) and solar-thermal systems; 20% for fuel cells. Maximum $5,000 for solar-energy systems; $1,500 for fuel cells. 10 kW maximum for solar-electric systems, except 50 kW for solar systems owned by condominium or cooperative housing associations; 25 kW maximum for fuel cells