The Impact of Prevailing Wage Expansion on Solar Photovoltaic Projects in New York State
March 25, 2019
Based on data provided by NYSEIA member firms, Prevailing Wage requirements have resulted in solar project cost increases of between 10 to 20 percent on average in New York State due to increases in labor costs related to site work. In general, the inflationary impact of Prevailing Wage requirements on solar projects is most pronounced in the residential and small commercial sectors. Without a broad exemption for renewable energy projects from Prevailing Wage expansion, or a commensurate increase in state support, many solar projects in New York State will no longer be economical, resulting in significant pullback of solar PV deployment. This would significantly hinder New York's ability to meet its ambitious clean energy goals. In addition to inflating project costs, Prevailing Wage mandates are also likely to dramatically expand administrative burdens to demonstrate compliance, which would further slow down deployment rates, shift business from smaller local developers to larger often out-of-state firms, and eventually lead many small and midsize residential, commercial, and industrial solar developers to shutter their operations.