New Jersey Solar Panel Incentives
When looking at solar panel incentives, we are incredibly lucky in the USA, to have numerous programs and incentives to support you on your clean energy journey. They are designed to help you become more energy sustainable and reduce your carbon footprint. At Solar Sesame we have put together some of the key ones in your state.
Before we dive into see what’s currently available let’s quickly get an overview of some of the most popular.
Categories of Solar Incentives
What are SRECs
Not available in all states, Solar Renewable Energy Certificates allow you to receive credits for the solar electricity you produce. You then sell the electricity back to the utility company or local SREC marketplace.
What is Net Metering
Net metering is an electricity billing incentive that helps you to generate your own electricity fully or in part with renewable energy sources like solar. You can then,, depending on the state’s criteria, sell back energy you produce to the utility company.
What is Property Tax Relief
This is a great incentive that gives you exemption from property taxes. Once you install a solar power system you can apply for a tax exemption to bring down your taxes.
What are Federal Tax Credits
Another great tax inducement are tax credits that you receive from the government to offset some of the installation costs of a solar panel system. Some states also have additional state solar tax credits.
What are Tax Rebates
This takes the form of a qualified part refund that you can receive from the utility company, local government or any company that has signed up for the program. You can only apply once the solar panel system is installed.
What are Low-Interest Loans
These are often some of the best and cheapest ways to get you on the solar energy ladder. They are usually offered at a reduced interest rate.
What are Performance-Based Incentives (PBIs)
A performance-based incentive (PBI) schemes are awards that give you a specified $ amount for every kWh of solar energy you produce. Not every state and utility company has signed up for this program.
At Solar Sesame we have done some exhaustive research to identify what solar panel incentives are available in your state. So let’s see what’s available.
What Federal Incentives are Available in your State
New Jersey Federal Solar Tax Credit
The state does offer The Federal Investment Tax Credit (ITC). Overall, you can expect to receive 26% of the cost of your solar set-up. In 2023, the tax credits will drop significantly to 22%. It’s worth noting that you are only eligible for Tax Credits if you are a homeowner and have purchased their solar panel system outright.
New Jersey Net Metering
Net metering is offered by the state. These are policies designed to allow homeowners, who produce their own solar electricity, to sell their surplus energy back to the utility company. The sale shows up as a credit on your utility bill.
The system is fairly simple. You create and use power when it’s needed, and any excess is automatically credited to you by your utility company.
To see the states that have a Net Metering Policy, check out the following from The National Conference Of State Legislatures
New Jersey Renewable Portfolio Standards
To promote renewable energy, the state has signed up to the RPS which means that utility companies operating in the region are obliged to generate a predetermined amount of sustainable energy per year.
If they don’t, a surcharge is levied on the company. To prevent having to pay these fees the utilities offer inducements to homeowners to install solar panels. The RPS covers all renewable energy sources, not just solar.
As such check out your local utility companies and see what RPS incentives they offer to get you up and running with solar energy fast.
New Jersey State Incentives For Solar Energy
New Jersey Performance-Based Incentives (PBI)
The state has signed up to the PBI which allows you to earn money from the solar energy that you produce. You may have heard of Solar Renewable Energy Credits (SRECs) these are the performance-based incentives that enable these Solar Power Performance Payments and are fantastic in helping you pay for the installation costs of your solar panel system. Payments are based on kilowatt-hours (kWh) or BTUs generated by your system, and measured by your electricity meter.
New Jersey Solar Energy Carve-Out
Similar to the Renewable Portfolio Standards, a solar carve-out is the percentage of energy in a state that needs to come specifically from solar. To prevent having to pay these fees the utilities offer inducements to homeowners to install solar panels.
New Jersey Massachusetts Property Tax Exemption
The state offers a great incentive to any homeowner who decides to install a solar panel system. Because solar energy will increase the value of your property, the state offers you a tax exemption, so that they only have to pay the pre-installation tax figure on their property as opposed to the tax on the increased valuation.
New Jersey Sales Tax Exemption
As with other innovative states, In a very forward-thinking move, the state has made the sales tax on the purchase of solar panel systems exempt if you are a homeowner.
New Jersey Transition Renewable Energy Certificates (TRECs)
This is a great way of earning income. Every megawatt-hour (MWh) of solar power you create, gives you one TREC which can then be sold in a marketplace for utility companies to buy and offset against their Renewable Portfolio Standard (RPS).