Trump Solar Tariffs & Soaring Utility Rates: Why Go Solar in New York Now?

With major policy changes on the horizon – bringing utility rate hikes, growing tariffs, and more – the U.S. energy landscape is at a critical point. Year over year, Federal and State policies are continuously evolving. As we move into 2025, renewable energy industries – especially solar and wind – will face many new challenges and opportunities. For homeowners and businesses, the path forward is clear: going solar today offers the best opportunity, and here at Kasselman Solar we are well prepared to help New Yorkers capitalize on this opportunity.

Drawing directly from trusted sources and analyses for this article, we will explore what may lie ahead in clean energy and how the industry can adapt to and work with potential shifts. Here we’ll take a look at the key policy changes shaping the energy market – from federal policy changes to utility rate increases and more.

Federal Renewable Energy Incentives

The Inflation Reduction Act (IRA), passed in 2023, has been a leader in policies and incentives regarding clean energy development in the U.S. The IRA provided over $369 billion to renewable energy investments. This act brought significant tax credits for solar, wind, battery storage, and electric vehicle manufacturing, however it is at risk going into 2025 (1).

Many of the incentives and rebates brought on by the IRA have spearheaded the growth of renewable energy, making it more affordable for homeowners and business owners alike.

A Quick Look at the Inflation Reduction Act (5)

Implemented by President Biden in August of 2o22
It works to incentivize more people and businesses to go solar by making it easier to invest in clean energy
Increased the Investment Tax Credit (ITC) to 30% through 2034, meaning homeowners or business owners can receive up to 30% of the cost of the solar installation back as a tax credit at the end of the year that the installation was completed in (6)
The IRA is projected to reduce greenhouse gas emissions by about 40% by 2030 when compared to levels in the early 2000’s

“Rather than a broad-scale rejection of clean energy, Trump’s administration is likely to selectively target provisions of the IRA, including federal grant and loan programs that he views as favoring clean energy over traditional fossil fuel industries.”

Forbes: “President-Elect Trump Seeks Level Playing Field in Energy Policy” (2)

As noted in Forbes, the future of these incentives and rebates is uncertain (1). The Trump administration has signaled intentions to scale back or even phase out this incentive. While it seems a full repeal of the IRA is unlikely, specific reductions or reallocations of these subsidies could drastically impact renewable energy projects (3). Even minor reductions to the IRA could cause you to lose out on thousands in savings on your solar project. Currently the IRA and local New York State incentives are all still available – get in touch sooner rather than later and maximize your savings when you go solar.

What’s at Stake:

A reduction to or elimination of the 30% solar tax credit could increase the cost of a $30,000 solar installation by upwards of $9,000.
This cost increase will lengthen the payback period of your solar system, meaning you’ll lose savings over time.

Why Act Now:

Starting your solar project now ensures you have the greatest chance at claiming the current, full tax credits and incentives.
Rate hikes, tariffs, and their implications aren’t new; in fact, as of December 18th 2o24, we have already experienced price increases – stemming primarily from manufacturers – and more increases are still to come.
We do not know how these incentives will change moving into 2025, but it’s best to go solar now before this issue arises.

Tariffs in Solar and Renewables

Tariffs on imported solar panels and components have long been a discussion when it comes to the energy department – and they’re certainly not brand new. In fact during Trump’s first time in office, he implemented tariffs on a variety of goods, some of which affected the solar industry, increasing costs. Currently there are tariffs affecting solar panels, components, and production, however the new tariffs will build upon these and dramatically raise price hikes (4). These tariffs ultimately impact the consumer drastically as manufacturers and sellers hike prices to maintain their profit margins despite higher costs.

Impacts on Costs:

Potential new tariffs could range from a 30%-50% increase on panels all the way up to a 100% tariff possible on batteries (4).
- And that cost is simply from the tariffs directly, not any additional price increases made by manufacturers or sellers, all of which will bring costs up.
Ultimately, your new solar panel system or solar batteries could end up close to double the cost.

These tariffs are generally designed to increase manufacturing within the U.S. and decrease importing of products from other countries. Ultimately tariffs like these increase costs overall for solar installations with the higher production cost domestically. A recent article by MIT Technology Review highlighted the possibility of new policies that could further adjust these tariffs and potentially affect supply chain and installation costs for solar (4).

Utility Rate Increases

New Yorkers have already been feeling the strain of rising utility bills. Infrastructure upgrade, electrification demands, and pressure from the global energy market are all working to drive both delivery and supply costs up -costs which ultimately affect you as the consumer. Continue reading more about utility rate increases on our blog, “Rising Utility Rates: The Case for Going Solar”.

Projected Bill Increases: 2025 and Beyond (*estimated increases*):

Central Hudson: +6% in 2025, +5% in 2026
- Total: +11% by 2027 (11)
National Grid: +20% in 2025, +15% in 2026
- Total: +40% by 2027 (10)
NYSEG: +25% in 2025, +20% in 2026
- Total: +50% by 2027 (8)
Orange & Rockland (O&R): +18% in 2025, +15% in 2026
- Total: +35% by 2027 (9)

According to a study by EnergySage, the average monthly electric bill is around $207 for New York residents, adding up to $2,484 per year (7).

*Chart assumes a starting average electric bill per month of $200

What Causes these Rate Increases?

Grid Modernization: Infrastructure upgrades and new construction costs are all being passed on to consumers.
Electrification Demand: The continued push to electric heating, EVs, AI data centers and more all further strain the existing energy supply.

How Solar can Mitigate Rising Costs:

Stabilize Energy Costs: Solar enables homeowners to generate their own electricity, limiting the impact of escalating rates.
Net Metering: With New York State’s net metering policies, excess energy credits can offset delivery charges, reducing your overall bills.

Future Implications

Changes to incentives and tariffs could cause major changes within the renewable energy industry. A reduction in federal support may slow adoption, particularly in areas that may not have strong state incentives. Higher tariffs on imported materials may also impact project timelines and effect overall costs for solar projects.

New York State benefits strongly from the incentives from federal policies, however the state also has strong local incentives which will last even with possible changes to federal policy.

Even with potential challenges depending on these changes, the renewable energy sector remains strong. State-level policies, sustainability goals, and demand directly from consumers help drive this growth. For example, there has been a growth in companies investing in clean energy and energy storage. Many companies have made pledges to implement certain amounts of clean energy which will continue the push to more clean energy.

What to Know as a Consumer

At the end of the day, possible policy changes are all still speculation based on various sources and knowledge. Until any changes are implemented, we can’t be sure what federal solar incentives, tariffs and the clean energy industry as a whole will look like moving into 2025.

What we do know is what federal and local incentives, rebates and tax credits are all available currently. The only way to ensure you maximize your savings when you go solar now. When you start the solar process as soon as possible, you have the best chance to claim the existing incentives. State level incentives can help you save tremendously as well, but don’t wait and possibly miss out on the 30% tax credit which is currently available.

Take Control of Your Energy Future

New York’s energy landscape is changing rapidly, and waiting to act could mean higher costs and fewer benefits. By choosing Kasselman Solar now, you’re taking control of your energy future and protecting yourself from uncertainty.

Secure Your Savings: Why Act Now?

Avoid Increased Tariffs: Lock in today’s prices before new tariffs could increase costs.
Maximize Savings: Secure the current federal and state tax credits while they’re still available!
Protect Against Rising Rates: Shield your energy bills from utility rate hikes when you generate your own clean energy.

Why Choose Kasselman Solar?

Proven Expertise: We’ve completed over 3,000 solar installations across New York State!
Local Knowledge: In the local solar business for over 10 years, we have extensive experience with local incentives and rebates, permitting laws and more, all of which can help you have a smooth process and maximize savings.
Top-Tier Technology: We are constantly looking for the newest industry-leading technology so we can offer maximum efficiency and reliability to our customers.
Customer-Focus: Our dedicated team works with you every step of the way, from initial consultation, to paperwork, to installation and post-installation service or upgrades, so you’ve always got someone to go to for questions or concerns!

Ready to start the solar process? Maximize your savings and avoid cost increases when you go solar with Kasselman Solar!

Published: 12/18/2024

Ava Clemenzi

Ava Clemenzi, Assistant Marketing Specialist at Kasselman Solar, is a recent graduate of Rensselaer Polytechnic Institute in Electronic Arts and Communication, Media & Design with a minor in biology. She is local to the Capital Region and joined Kasselman for the opportunity to expand upon her experience in the marketing and design field while working with and helping others in the community.