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Mar 13 2023
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nem 2.0

5 Things To Know in the Final Weeks of NEM 2.0

By Solar Panel Cost, Solar Panel Costs by State No Comments

Update: NEM 3.0 took effect on April 15, 2023 and the window to grandfather new solar systems into NEM 2.0 is closed. If you submitted an interconnection agreement on or before April 14, 2023, your system can still be grandfathered into NEM 2.0 even if your utility reviews and approves your application after the submission deadline.

On April 15, 2023, a new solar billing plan known as NEM 3.0 will replace NEM 2.0 for customers of California’s three investor-owned utilities (IOUs).

If you’re reading this article, you probably have an idea of what’s going on. If not, here’s a quick refresher:

  • The savings of going solar under the new NEM 3.0 solar billing plan will be substantially lower than under NEM 2.0
  • Existing solar systems will remain under their current net metering policy for 20 years from the date they received permission to operate
  • To grandfather a new system into NEM 2.0, you must submit a complete interconnection application by April 14, 2023

And that brings us to today: The last call for NEM 2.0.

With the deadline weeks away, homeowners are rushing to go solar in order to lock in NEM 2.0 and the California solar industry – including solar.com – has adapted and streamlined the solar process

The name of the game is to get a solar system designed and approved as fast as possible so your installer can submit an interconnection application by April 14.

With that in mind, here are five things you should know about going solar in the final weeks of NEM 2.0.

Preparation is key

Let’s say you’re late for a flight. One thing you might do to speed things up is have your ID and boarding pass ready in your hand instead of zipped inside a bag.

The same concept applies to going solar in the final weeks of NEM 2.0. One thing you can do to speed up the process is to come prepared with the following items.

  • All pages of your utility bill. Your utility bill has crucial information for sizing and interconnecting your solar system. Provide all pages of your bill and make sure it includes your meter number, account number, usage, and rate plan.
  • Photos of your electrical panel. Provide photos of your electrical panel to show the main breaker/busbar and the label. It’s common for electrical panel labels to be worn and tough to read, but it’s very helpful to have that information. Take time to zoom in if needed – the more pictures the better!

By providing this information upfront, you may be able to forego scheduling a site visit and further expedite the solar process.

Get your solar project started today.

Installers have different cutoff dates for getting into NEM 2

California solar installers are doing their best to grandfather as many systems into NEM 2.0 as possible while also being realistic about their capacity to do so.

At solar.com, we are in constant contact with our installer partners and have asked them to provide a cutoff date for when customers need to sign a solar contract in order to be grandfathered into NEM 2.0. These dates range from March 1 all the way to April 14.

The closer we get to the NEM 3.0 deadline, the fewer installers there will be to choose from. With that in mind, the “best” installer for your project is the one that can get your interconnection application in by April 14.

Pro tip: Be wary of solar installers overpromising or guaranteeing they can grandfather your system into NEM 2.0. Any reputable installer will tell you that there are no guarantees.

You may be asked to wait to pair your solar system with battery storage

While there are several advantages to pairing solar with battery storage in California, battery storage adds extra time and steps to the solar process.

And, in case you haven’t noticed, time is of the essence.

The good news is that you can add battery storage to your solar system later and still retain your NEM 2.0 status. So, the idea is to focus on locking in NEM 2.0 first, then circle back to battery storage later.

People are bending over backwards to get your system into NEM 2.0

The NEM 3.0 solar billing plan was approved on December 15, 2022 and allowed just 120 days for IOU customers to grandfather new systems into NEM 2.0.

For reference, the solar process typically takes 3-5 months. So, 120 days is a very short window.

But in this time, numerous people in the solar industry have bent over backwards to help as many homeowners as possible lock in NEM 2.0 and maximum solar savings.

This includes:

  • Policy experts poring over the 260-page NEM 3.0 decision, interpreting it into plain English, and providing a roadmap for grandfathering solar systems
  • Solar installers streamlining their process and putting in the extra effort to accommodate as many customers as possible
  • Energy Advisors putting in months of long days to answer questions, design systems, set homeowners up for success

And let’s not forget the solar advocacy groups that spent years fighting – and substantially improving – NEM 3.0 on behalf of California solar owners.

Much of this work happens behind the scenes and without it the window to go solar under NEM 2.0 would have closed long ago.

Missing the NEM 2.0 deadline is not the end of the world

Finally, it’s important to remember that although solar savings are greater under NEM 2.0, there is still plenty of money to be saved by going solar under NEM 3.0.

In fact, the energy cost savings of going solar under NEM 3.0 will still be much greater than going solar in most places. There’s a few reasons for that:

  • California electricity prices are among the highest in the US and expected to rise at 9-10% per year over the next few years
  • Solar and battery storage provide backup power during power outages, which increased 78% from 2011-2021
  • California’s abundant sunshine makes going solar cheaper than most places (more sun = fewer panels = less money)

That’s not to mention the environmental benefits of rooftop solar, the increased home value, and taking control over your electricity rate.

We absolutely encourage you to try to go solar under NEM 2.0 to maximize your savings – but be careful not to step over a twenty dollar bill to pick up a one. If you miss the deadline, there is still plenty of incentive to go solar under NEM 3.0.

Start your solar project with multiple quotes from vetted installers.

 

Mar 10 2023
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Going Solar in Hudson Valley New York: Incentives, Savings, and Installers

By Solar Incentives by State, Solar Rebates & Incentives No Comments

New York’s Hudson Valley is known for its rich history and natural beauty, but it may not jump out as the best place for solar power.

However, between a robust set of incentives, strong net metering policy, and fast-rising electricity prices, this region of New York has just the right ingredients for substantial solar savings.

In this article we’ll explore:

Let’s dive in with a look at the local, state, and federal solar incentives available in the New York’s Hudson Valley.

Solar incentives in Hudson Valley NY

The Hudson Valley isn’t nearly as sunny as California’s Central Valley. However, New York has some of the best solar incentives in the US that decrease the cost and increase the savings of going solar.

In 2023, the incentives include:

  • 30% federal solar tax credit
  • 25% New York State tax credit
  • NY-Sun Megawatt block rebate
  • 1-to-1 net metering
  • Sales tax exemption
  • Property tax exemption

Now, let’s say you live in Ulster County NY and get your electricity from Central Hudson. You need a 7.1 kW solar system that costs $25,000 to completely offset your electricity usage. Here’s how the solar incentives would bring down the cost of the system.

Sales and property tax exemptions

The first incentive to apply is a sales tax exemption for sales and installations of residential solar energy equipment.

In Ulster County, where the combined sales tax rate is 8%, that amounts to $2,000.

In addition to the sales tax exemption, there is a 15-year property tax exemption that applies to the value added by the solar system. So, if going solar increases your home value – as it typically does – your property tax rate will still be based on the pre-solar value of your home.

That’s a pretty good start, but we’ve hardly scratched the surface.

NY-Sun Megawatt Block rebate

The next incentive that applies to solar systems in the Hudson Valley is the NY-Sun Megawatt Block program run by NYSERDA.

This program reduces the upfront cost of going solar based on the size of the system and region it is in. The Hudson Valley stretches across two regions: Upstate and Con Edison.

Here’s how much the incentive would be worth for a 7.1 kW (7,100 Watt) system.

Region Incentive level* Incentive for 7.1 kW system
Con Edison 20 cents per Watt $1,420
Upstate 20 cents per Watt $1,420

Incentive level as of March 2023 and subject to change or expire. Check current incentive levels here.

So, if you’re a Con Edison customer, the NY-Sun incentive brings the upfront cost down to $23,580. That’s not a bad chunk of change, but the best is yet to come.

State and federal solar tax credits

Now, here’s where the solar incentives really start to add up. In addition to the 30% federal solar tax credit available to homeowners across the country, New York has a state solar tax credit worth the lesser of $5,000 or 25% of the price paid for the system.

These tax credits can be combined to reduce the cost of the system by up to 55%. However, it’s important to note that they apply the price paid after factoring in the NY-Sun rebate.

Here’s how that works for our $25,000 system in Ulster County.

Gross price $25,000
NY-Sun rebate -$2,130
Price paid $22,870
Federal tax credit (30%) -$6,861
NY State tax credit (25%) -$5,000 (maximum incentive)
Net cost $11,009

After the tax credits are applied, the cost of the system is reduced by over 55% to $11,009.

Solar tax credits are claimed on your federal and state tax returns for the year your solar system is deemed operation (approved by a city inspector). And it’s worth noting that you need sufficient tax liability (taxable income) in order to claim them.

So, if you are retired and have limited tax liability, you may not be able to claim the full value of the credits. If you can’t claim the full value of the credits in one year, they can be rolled into future tax years.

Always consult a licensed tax professional with questions regarding tax credits and liability.

 

 

Solar net metering in Hudson Valley NY

The final incentive to consider when going solar in the Hudson Valley is net metering.

Net metering is the billing structure that allows homeowners to earn credit for the excess solar electricity that they push onto the grid during the day in order to offset the cost of pulling electricity from the grid at night.

In other words, it’s what makes solar work in a relatively unsunny place like the Hudson Valley.

New York is in the midst of transitioning its net metering policy and currently offers two options:

Phase One Plus CBC is the transitional net metering option where the value of solar exports is based on the retail price of grid electricity. The CBC stands for Consumer Benefit Contribution, which is a small monthly fee based on the size of your system and utility provider. If chosen, Phase One net metering is locked in for 20 years, after which the billing structure will change to whatever policy is in place at the time.

Utility 2023 net metering CBC rate ($/kW) Monthly fee for 7.1 kW system
Central Hudson $1.18 $8.37
Con Edison $1.09 $7.74
NYSEG $0.70 $4.97

So, for our 7.1 kW system in Ulster County, the CBC fee would be $8.37 per month or $100.44 per year – which is well worth the price of locking in a strong 1-to-1 net metering policy. (Just ask your friends in California).

The second option – and the one that will take over eventually – is the Value of Distributed Energy Resources (VDER), also known as the Value Stack.

In the Value Stack, the value of solar exports is based on a combination of factors, including the:

  • Price of wholesale electricity
  • Value of the electricity to the grid
  • Environmental value of the solar electricity
  • Degree to which solar electricity reduces the need for infrastructure upgrades

In general, solar export rates are lower in the Value Stack, which means solar owners are credited less for their contributions. The Value Stack also includes a CBC, just like the Phase One program.

Utility 2023 VDER CBC rate ($/kW) Monthly fee for 7.1 kW system
Central Hudson $0.59 $4.19
Con Edison $0.54 $3.83
NYSEG $0.35 $2.49

For our 7.1 kW system in Ulster County, that amounts to $4.19 per month or $50.28 per year. That’s about half of the CBC for net metering. However, if your export rates are lower in the Value Stack you may end up having residual electricity bill.

As more and more states seek to weaken or remove 1-to-1 net metering programs, New Yorkers still have an opportunity to lock in this incentive for 20 years.

Solar savings in Hudson Valley NY

The second reason why the Hudson Valley is prime for solar savings is because of its high and fast-rising electricity rates.

Con Edison customers face some of the highest electricity rates in the US. So, how does paying for grid electricity in the Hudson Valley compare to the cost of going solar?

new york electricity prices

Let’s go back to our 7.1 kW system with a net cost of $11,009. Factoring in the average sun exposure of Ulster County and natural degradation of solar panels, a 7.1 kW system can be expected to produce 165,000 kWh of electricity over 20 years of net metering.

If you take the net cost of $11,009 and divide it by the lifetime production, you get a levelized rate of 6.6 cents per kWh.

$11,009 / 165,000 kWh = 6.6 cents per kWh

Congratulations, you’ve just slashed your electricity price by 20 cents per kWh and are paying the average rate Americans paid in 1981.

Better yet, you’ve locked in that rate for the 20-year duration of your net metering policy. So, while the price of grid electricity continues to rise over time, the cost of your solar system remains constant.

Here’s how that looks over 20 years.

Cost of solar versus grid electricity in Hudson Valley NY

solar vs grid hudson valley

Even with a modest 2.5% annual inflation rate for grid electricity, the savings of going solar in the NY Hudson Valley is well over $30,000 and closer to $35,000 if you pay cash.

And remember, most solar systems are warrantied for 25 years and can last much longer. So the savings continue to grow, but it’s difficult to predict at which rate.

Solar companies in Hudson Valley NY

Between incentives, electricity prices, and net metering, the Hudson Valley – and New York in general – is currently in a sweet spot for solar savings. So, how does one take advantage of this opportunity?

The key to a successful solar installation is using a reputable solar company with a proven track record of excellent craftsmanship and customer service in your area. It’s also important to get multiple quotes so you can compare pricing, products, and warranties.

Now, we absolutely encourage you to research solar companies yourself. However, solar.com has a network of installers in the Hudson Valley that have already been through our rigorous vetting process.

And using solar.com, you team up with an unbiased Energy Advisor to design a custom solar system and easily compare quotes from our network of installers. That saves you the time of vetting and setting meetings with multiple companies.

 

 

Frequently asked questions

Is solar worth it in Upstate NY?

Yes, thanks to robust incentives, high electricity prices, and a strong net metering policy, upstate New York is one of the best places in the US to save money by going solar. However, it’s worth noting that the NY-Sun incentive for Upstate New York is in its final block and New York is in the midst of transitioning its net metering policy. So, the sooner you go solar in Upstate New York, the greater your savings will be.

What is the NYS solar incentive for 2023?

There are a number of solar incentives available in New York State in 2023. These include:

  • 30% federal solar tax credit
  • 25% New York State solar tax credit
  • NY-Sun rebate
  • Sales and property tax exemptions
  • Strong net metering policy

The NY-Sun rebate is in its final stages and expire in 2023 or soon after.

Where do you find solar panels in Hudson Valley NY?

Solar panels are typically purchased through an installation company. Solar.com has a network of vetted installers in New York’s Hudson Valley, each with a variety of panels, inverters, and batteries to consider.