Long Island Solar Incentives 2026 — what is left, and what it is worth.

1. The federal credit: ended for systems you buy

Through 2025 the federal residential clean energy credit (Internal Revenue Code Section 25D) returned 30% of system cost. It ended for expenditures made after December 31, 2025. There is no phase-down and no replacement credit for a homeowner who buys with cash or a loan.

On a $26,000 install that credit was worth $7,800. In 2026 the federal line on a purchased system is $0 — if a quote shows otherwise, it is a 2025 document. Leases and PPAs are different: the company that owns the system may claim a separate commercial credit and can pass savings through in its rate, but you do not claim anything yourself. Confirm your own position with your tax professional.

2. New York State Solar Tax Credit (25%, capped at $5,000)

New York's own credit is unchanged: 25% of system cost, capped at $5,000 — on a $26,000 install you get the full $5,000 state credit. Filed via NY Form IT-255 with your state tax return.

Unused state credit rolls forward up to 5 years. This credit applies to roof-mounted residential solar; commercial systems use a different credit structure.

3. NYSERDA NY-Sun: exhausted for most Long Island homes

NY-Sun paid a per-watt rebate through your installer. The standard-income residential Megawatt Block for the Long Island region is exhausted, so a market-rate household should not expect a NY-Sun rebate on a 2026 quote.

Pathways for households at or below 80% of area median income remain open. If that may be you, check eligibility directly with NYSERDA before signing — and if a market-rate quote shows a NY-Sun line, ask which block it is drawing from.

4. NY State Sales Tax Exemption

Residential solar electric systems are exempt from New York State sales tax under Tax Law section 1115(ee). On a $26,000 install, that saves roughly $1,040 versus a typical 4% local rate — applied automatically at the time of sale by your installer.

5. Property Tax Exemption (15 years)

NY Real Property Tax Law section 487 provides a 15-year exemption from the added home value attributable to solar. Translation: installing solar will not raise your property assessment (and therefore not raise your school + property taxes) for 15 years.

Town of Huntington follows the section 487 exemption. Some Suffolk County municipalities require a one-page filing — your installer typically handles it. Estimated savings: $500–$1,500/year in avoided property tax depending on your tax rate.

6. PSEG Long Island Net Metering

PSEG Long Island runs full retail net metering for residential solar customers — every kWh your panels push to the grid offsets one kWh of nighttime consumption at full retail rate. This is not technically an "incentive" but it is what makes solar economically viable on Long Island.

Long Island homes are not on VDER, the state's Value Stack tariff. LIPA applies Value Stack crediting to large commercial projects; a home system stays on net metering, unused credit carries forward, and a system connected since 2018 gets no annual cash payout (LIPA Tariff for Electric Service, Leaf No. 34F-1 and 34F-2, effective June 1, 2024).

How it shows up on your bill, per PSEG Long Island's own Solar Power and Net Metering brochure (form FC 15014, September 2018), which describes the program PSEG runs for the Long Island Power Authority, read alongside the current tariff:

1. A net meter is installed that runs forward when you draw power and backward when you export it.
2. Each excess kilowatt-hour earns one energy credit, banked in an Energy Credit Bank shown on your bill.
3. For a home system connected since January 1, 2018, credits carry forward month to month and are drawn down automatically in months when you use more than you generate. There is no annual cash payout, and credit still on the account at the 20th anniversary of the in-service date is removed (Leaf No. 34F-2).
4. For a system connected before January 1, 2018, credits run on a 12-month contract year. At the annual reconciliation, leftover credits are paid out at the SC-11 buy-back rate, the wholesale cost of power, and the bank resets to zero.
5. On a time-of-use rate, each period has its own credit bank, and peak and off-peak credits cannot be combined.
6. You still get a bill every month, because the fixed charge for your grid connection applies whether or not you exported power.

The brochure says its terms are "subject to change without notice, including early termination." Before you sign, ask PSEG Long Island which net metering terms a system interconnected today is approved under, and ask your installer to show that answer in writing alongside their savings estimate. Do not let a proposal assume a compensation method nobody has confirmed.

What this does to sizing: because credits bank kilowatt-hour for kilowatt-hour and, on a system connected today, never turn into cash, an array sized to your own annual usage captures the most value. Our read-your-PSEG-bill guide shows where to find twelve months of usage, the only sound starting point for system size.

7. Battery Storage Incentives

The federal residential credit that used to cover a purchased battery (Tesla Powerwall, Enphase IQ Battery) ended with the solar credit on December 31, 2025. A $14,000 Powerwall 3 bought in 2026 gets no federal credit.

NYSERDA has run a residential battery incentive paid per kWh of storage. Funding is limited and changes, so we confirm what is open at quote time rather than assume it. Price a battery on outage coverage — keeping the well pump, refrigerator and heat running — not on incentive math.

Worked example — 8 kW Huntington install, 2026

Gross install cost: $26,000 (sales tax exemption already reflected in the price).

- Federal credit on a purchased system: $0 (ended December 31, 2025).
- NY State 25% credit (capped): −$5,000.
- NYSERDA NY-Sun: $0 for a standard-income household.
- 15-year property tax exemption: the system does not raise your assessment.

Net out-of-pocket: about $21,000. Assuming PSEG's effective rate of ~$0.27/kWh and ~10,400 kWh/year of production, that is about $2,800 a year in displaced electricity and a simple payback of roughly 7.5 years. The same install in 2025 netted about $11,200 and paid back in about 4 years; the difference is the expired federal credit and the exhausted rebate block. Call the realistic 2026 range 7–9 years.

The order to claim it in

For a homeowner buying in 2026, the sequence is:

1. Before signing: if you may be income-eligible, check NY-Sun's income-qualified pathway with NYSERDA first. Confirm net metering terms with PSEG Long Island. Call your town assessor about the section 487 exemption.
2. At contract: confirm the quote shows zero federal credit, no NY-Sun line unless you are income-qualified, and no state sales tax on the equipment.
3. At installation: your installer files the PSEG Long Island interconnection application, PSEG installs the net meter, the installer sends the closeout documents, and PSEG Long Island grants permission to operate. The install process page lays out that sequence.
4. At tax time: file Form IT-255 with your New York return for the year the system was placed in service, using the installer's final cost letter.
5. Within your town's deadline: the section 487 exemption filing, where your town requires one.

What we file for you

When you sign with us, the following are filed on your behalf at no additional cost:

• NYSERDA income-qualified NY-Sun application, where you are eligible
• NY State sales tax exemption (applied automatically at contract)
• NY State property tax exemption filing (where required by municipality)
• PSEG Long Island interconnection application and net metering tariff selection
• Town of Huntington Building Department + Suffolk County electrical permits
• Final placed-in-service cost letter for your NY State Form IT-255 filing