Long Island solar installers eyeing ways to adapt as federal tax credit nears end

The Trump administration’s "big beautiful bill" sparked a late-summer flurry for new residential solar systems on Long Island as homeowners scrambled to take advantage of an expiring tax credit that covers a third of system costs.

But with a potentially record-setting 2025 coming to a close, Long Island’s perennially adaptive solar installers are facing a big new challenge: how to make up for a big chunk of lost sales some are predicting for 2026 after the federal tax credit goes away at the end of this year.

Many solar companies saw their applications for new systems soar from July through September after the bill was passed, according to figures from PSEG and dealers, and installers are now rushing to get systems completed by Dec. 31 so that customers are eligible for the expiring 30% federal tax credit. The credit has always been a big incentive for system purchases, reimbursing a third of the cost of systems that typically run from $20,000 to $40,000.

Mike Voltz, director of energy efficiency and renewables for PSEG Long Island, said the utility has added two engineers to help in processing applications and engineering work needed by installers and homeowners to help make sure homeowners get the credit.

"We're doing our part to make sure they get their approvals," he said. 

Voltz said the utility saw one of its highest monthly runs for solar in September, with more than 1,000 applications processed, and expects to end the year with upward of 10,000 new rooftop solar installs. That's a jump from the average 6,000 to 8,000 per year. Long Island has been the state's leader in solar, with some 100,000 of LIPA's 1.2 million customers expected to have rooftop solar in coming months. 

Most installers stopped promising eligibility for the credit in July and August, given the long lead time needed to obtain permit and complete jobs.

"The tax credit for homeowners is pretty much done," said Jonathan Cohen, policy director for the New York Solar Energy Industries Association, a state business group.

Some installers working to finish projects by the end of the year are also facing potential product shortages. "There is supply, but it’s getting harder and harder to procure materials to do the projects before the end of the year," said William Feldmann, chief executive of Empire Clean Energy Supply, a distributor in Bohemia.

Loss of the tax credit means selling solar systems to residential customers will get tougher, dealers say, as the time it takes for the systems to pay for themselves through electric-bill savings will increase to eight or nine years, compared with four or five with the credit. But others say because of rising energy costs, there will always be a market for customers to shave electric bills with solar.

In addition to the expiring tax credit, local solar companies also are looking beyond 2025 to plan for a year of arcane new federal rules governing the content and origin of home solar products and components and their potential impact on pricing and availability. "It’s getting more difficult to find product that complies," said Feldman.

Some installers are exploring ways to enter the leasing business, which still is eligible for the tax credit (though the leasing credit goes to the developer, or third-party system owner such as leasing company SunRun, not the customer).

"If you don’t pivot right now, you don’t have a business," said Scott Maskin, chief executive of SUNation Solar Systems, one of Long Island’s largest home solar installers. His business has hit records in the past few months, he said, but he pointed to industry projections of an up to 40% decline in owned systems next year, as momentum moves to leased systems. He and other say they've been disappointed the state has yet to step in an announce programs that help restore incentives the federal government is eliminating. 

"The state has not done a thing," said Maskin, saying New York could increase its current cap on solar installs of $5,000 to $10,000 to help ease the burden. 

Ken Lovett, a spokesman for Gov. Kathy Hochul, in a statement said, "The cuts enacted by the Republicans in Washington will cost us thousands of jobs. We need our New York Republican delegation to defend their constituents rather than kowtowing to the White House and their congressional leadership." He declined to outline any planned state solar incentives, noting only that Hochul will detail her agenda and spending plan for 2026-27 in January.

Cohen said some are projecting more than half the state’s 16,000 solar and battery-storage industry workers are at risk of losing their jobs next year as a result of the federal cuts. "We’ve already seen some companies laying off workers," he said.

Others are exploring complementary businesses beyond solar, including geothermal heating and cooling systems, while still others are looking for areas of the business that aren’t as immediately impacted by expiring credits or complex new restrictions on solar-panel components or countries of origin.

GreenLogic, a Southampton-based solar installer, has entered the market for geothermal heating and cooling systems, a complementary market, said vice president John Rocchetta. "We’re a renewable energy company and my focus is on decreasing a customer’s energy load," he said, noting geothermal systems, while pricey, are the most efficient heating and cooling available.

Geothermal "can be paired with solar to push a house to near net zero" energy use, he said.

He said GreenLogic also will continue to work with its large network of existing customers, and word-of-mouth new ones, to sell new systems or upgrade existing arrays, using the home-owned model.

But most will probably eye some form of leasing model given the tax credit extension through 2027. "If you can get a financing partner out there, then making the switch to a leasing model is sustainable," he said.

With leased systems, homeowners pay a monthly leasing fee for the system on their roofs with the solar systems owned by third-party companies, and get the benefit of savings from the solar system. It’s not as economical as systems they own.

The catch with switching to the leasing model? It's the challenge of finding a financing firm willing to take on the business. Among the biggest solar-related companies to file for bankruptcy protection is Mosaic Solar, which handled financing. Other companies that have either filed for bankruptcy protection or are regrouping: solar leasing firm Sunnova, regional installer Posigen and panel supplier SunPower.

While installers of residentially owned solar systems are scrambling, those in the market for larger commercial, education or municipal solar systems say their business is less impacted or not at all.

"Solar is not going away," said Stephen Foley, an account executive at Johnson Controls, which develops complex energy savings systems for schools and other large clients. Solar systems with battery-storage backups are an increasing part of the business and his sales typically include energy-saving lighting, insulation, heating and cooling systems.

The company made the model work before tax credits were even available to the school sector, and will do so when they eventually expire, Foley said. Some districts that initially opted for just the first phase of the upgrades are stepping up for phase two, he said. "I love the industry and I still think there are plenty of opportunities," Foley said.

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.