Wetland Rules Slow Solar Buildout Amid Rush for Tax Credits

December 20, 2025

New York adopted rules at the end of last year meant to protect smaller wetlands from development, nearly doubling the amount of state-protected land. They also introduced a bureaucratic hurdle for anyone looking to build: The state Department of Environmental Conservation now has to tell developers whether their plans touch any wetlands — and that can take three months or longer.

Before the new rules took effect, developers could just look at a map and avoid touching protected land. Now, it’s harder to tell where the wetlands are, and even if developers have an idea, the rules require them to ask the DEC to check every parcel. The increased number of wetlands also puts more areas off limits.

The slowdown is colliding with rapidly approaching deadlines for the federal subsidies. Under the megabill Trump signed into law in July, renewable projects generally have to start construction by July 4, 2026, if they hope to claim the longstanding tax credits, which have comprised a third or more of project funding.

The wetlands rule change is particularly frustrating developers building mid-size, “community” solar farms, which can generate up to five megawatts, span 20 or 30 acres, and power up to 1,000 homes. Such projects account for the lion’s share of renewables built in the state in recent years; so far, community and rooftop solar on the state’s grid outpaces large solar farms by more than 10 to one. But analysts expect the buildout to slow, and not just because federal tax credits are disappearing.

New York has a centralized permitting process for wind and solar, but only for large projects. The state’s permitting process for smaller solar projects is one of the strictest in the country, and the wetland rules have only added to the regulatory maze.

With the tax credit deadline coming up, the DEC’s verdict can be make or break, said Noah Ginsburg, executive director of the New York Solar Energy Industries Association, a trade group.

“It’s kind of binary: Am I going to do this solar project or not?” he said. “Getting your DEC … determination quickly has a major impact on that.”

Any developer seeking to build an energy project in New York has long had to seek approval from some combination of local, state, and federal agencies, including to make sure the project won’t disrupt ecosystems.

Proponents of the new DEC rules say that the small wetlands they protect are critical habitats for rare species and provide crucial protections for humans, too, helping to absorb floods and filter drinking water. New York has lost roughly 60 percent of its historic wetlands.

Rob Hayes, senior director of clean water for Environmental Advocates NY, said the state’s previous, “antiquated” wetland maps were leading more wetlands to be paved over at a moment when they are increasingly needed to help shield against the effects of climate change.

In principle, the DEC is supposed to answer developers within 90 days. During that time, the agency uses mapping software to check whether a parcel of land includes a wetland and, if so, whether it matches any of 11 criteria that would make it “unusually important.”

In practice, the process often takes longer than 90 days, Ginsburg said. Often, he said, the agency does not respond until developers send an official follow-up letter after the 90 days are up. The DEC has two weeks to respond to the follow-up.

If the DEC determines that the project overlaps with wetlands, and the developer still wants to move ahead, they need to go through two more stages of review to confirm whether they need a wetland-specific permit for their project.

“The amount of red tape there is in New York to get a project done is incredibly challenging,” said Emilie Flanagan, CEO of the community solar and storage company Carson Power. Building a solar farm requires — at minimum — a sunny spot with willing landowners, easy access to the grid, and signoffs from local governments. It’s getting harder and harder to get “all the stars to align,” she said.

The wetland rules have added to that. “Now you’re at a place where you’ve got, let’s call it, 12 of the 20 filters that have been screened fine and suddenly, there’s more scrutiny from the DEC,” Flanagan said.

Flanagan’s company is based in New York but recently expanded to Illinois, where it can take three months or less to get a permit from start to finish, she said. New York’s full permitting process for community solar can take two or three years. Flanagan said she didn’t blame the agency for holding up projects, and that it likely needed more staff to avoid unnecessary delays.

A DEC spokesperson said the agency has been working as quickly as possible to process a high number of applications — about 8,500 so far this year, or an average of 35 per working day — and “continues to work closely with our partner agencies to ensure a fair and efficient permitting process.” They pointed to an exemption where, in certain cases, companies can hire their own consultant to review wetlands status.

“Governor Kathy Hochul knows that New Yorkers deserve clean, reliable, and affordable energy,” the spokesperson said. “That’s why she directed us to accelerate our work and ensure that the momentum behind clean energy continues to grow here in New York, regardless of what happens in Washington, D.C.” (Hochul this fall promised a “whole-of-government approach … to ensure that as many projects as possible reach construction quickly” and take advantage of federal tax credits.)

The state has successfully sped up some parts of the process. In July, the DEC issued what’s known as a “general permit” for solar projects, allowing developers to build on or near wetlands without applying for an individual permit as long as they meet specific conditions — but that can only happen after the 90-day period when DEC checks the status of the land. Ginsburg called it a step in the right direction, but said the conditions remain prohibitive for many projects.

Hayes, of Environmental Advocates NY, said the DEC had struck a fair balance. “New York needs wetlands to protect against the flooding from extreme weather events. And New York needs renewable energy projects in order to reduce our emissions and ensure cleaner air,” he said. “These are not mutually exclusive goals.”

Hayes praised the DEC rules and the agency’s responsiveness to public input, including from developers of all stripes. He said any delays in implementation likely stemmed from how new the rules are.

“It may take some time to get everybody on the same page and to work out kinks in the program,” he said. “But at the end of the day, expanding protections for wetlands was the right move.”

Some disagree. In late April, New York’s leading business federation, local property owners, and a variety of other interests filed four separate lawsuits challenging the rules, arguing that they hinder housing construction and other much-needed development.

Ginsburg said that, setting aside the merits of the expanded protections, the key thing for solar developers now is getting faster answers from DEC.

“At this moment in time, really, the name of the game is getting … determinations quickly, so folks know which projects they’re going to move forward and which ones they’re going to cancel and move on,” he said.

That’s in part because the state requires projects to obtain at least four or five major approvals besides a permit, said James Muscato, an attorney at the environmental law firm Young/Sommer. (His firm represents most of the projects that have obtained ORES permits to date.)

For most projects, that includes a state certification under the federal Clean Water Act. Obtaining it generally takes about six months, Muscato said. Developers also need the state DEC to sign off on their plans to manage stormwater runoff and avoid pollution during construction. This, too, can take several months.

The greatest risks to large projects today, though, lie in federal permitting. The US Army Corps of Engineers needs to review wetland impacts in parallel with the state. The Army Corps paused, then unpaused all permitting for renewable projects soon after Trump took office, but went on to say it was keeping the freeze on wind. Then, in September, it announced plans to prioritize approvals for projects that generate the most energy on the least amount of land — putting nuclear and fossil fuel plants ahead of sprawling solar and wind farms.

It’s not clear yet how drastically this will restrict renewable permitting moving forward. At least one major New York solar project got an Army Corps signoff this spring, according to filings, but that was before the latest directive took effect.

Army Corps spokesperson Doug Garman said the agency is still issuing solar permits, and is continuing to “accept and evaluate applications” for wind projects while monitoring ongoing litigation. (A judge last week struck down Trump’s January executive order against wind farms, in a lawsuit brought by New York and other states.)

Meanwhile, this fall, the Trump administration proposed a major revision of Clean Water Act rules that could drastically roll back federal protection of wetlands in general. The administration has promised the proposed rules will “cut red tape” for industries including energy developers, but their full impact on renewable projects remains to be seen.

Water permits aren’t the only federal challenge. Some projects also need permits from the US Fish and Wildlife Service, like wind farms that risk killing an eagle. Interior Secretary Doug Burgum issued a directive in July requiring that all such permits now receive his own personal signoff — a measure the administration said would “further deliver on President Trump’s promise to tackle the Green New Scam.” Many developers now see the Department of the Interior, which houses the Fish and Wildlife Service, as the single biggest roadblock to building large-scale renewables.

Muscato stressed that there was no easy fix New York could make to build more clean energy in the face of staunch federal opposition. Still, he said, cutting down the various bureaucratic timelines could help.

ORES executive director Zeryai Hagos assured developers at a conference this fall that he shared that goal. “It’s not going to be because of ORES, it’s not going to be because of a New York State agency and our bureaucracy and inefficiencies that these projects don’t achieve their timelines,” he said.