New Jersey solar rebates and incentives: 2024 guide

The average New Jersey solar shopper will save $4,295 on solar panels with rebates and incentives.

Updated May 7, 2024

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    Written by: Casey McDevitt

    Solar panel systems in New Jersey are expensive, but incentives from the state and federal governments can help you reduce the upfront cost. Between the federal tax credit and other state-specific incentives, you can save thousands on solar panels, making them well worth the investment. Here's how you can lower the cost of solar if you live in New Jersey.

    See how much solar costs in New Jersey

    As a New Jersey homeowner, you have access to some great incentives that can substantially improve your return on investing in solar panels. The ITC and SREC programs are some of the most impactful ways to bring down your solar costs.

    Incentive
    Average savings in New Jersey
    Description

    Residential Clean Energy Tax Credit, formerly the federal investment tax credit (ITC)

    $4,295

    Lowers your solar panel system's cost by 30%

    Successor Solar Incentive (SuSI) program

    $850

    Allows you to generate and sell SRECs to utilities

    Residential Clean Energy Credit

    The Residential Clean Energy Credit, formerly known as the federal investment tax credit (ITC), can reduce your solar panel system's cost by 30%. Your entire system qualifies for this incentive, including equipment, labor, permitting, and sales tax.

    The average cost for a 5 kW solar panel system is around $14,318 in New Jersey. Once you factor in the 30% credit, the cost comes down to $10,023.

    When you file your federal income taxes, you can claim this incentive as a credit towards your federal tax bill. Just keep in mind that to qualify for the ITC, you need to purchase your system either with cash or a solar loan–if you lease your system, you won't be eligible. 

    You also need a high enough tax bill, though you can roll over any remaining credit year-to-year until the end of 2034 when the ITC expires. The only time you might be eligible for a direct payment for the ITC is if you're a tax-exempt entity, like a nonprofit organization.

    Successor Solar Incentive (SuSI) program

    The Successor Solar Incentive (SuSI) Program is New Jersey’s solar renewable energy credit (SREC) program. Under the state's renewable portfolio standards (RPS), utilities are required to generate a certain amount of solar energy. As a solar owner, you can earn one SREC for each megawatt-hour (MWh) of clean electricity your panels produce. Then, you can sell the SRECs to utilities to count towards their renewable generation. 

    For residential systems, you’ll earn $85 per SREC. Here’s how to start selling SRECs in New Jersey:

    1. Register your solar panel system through the SuSI Program portal before you start construction.

    2. Once your solar installation is complete, submit a post-construction packet and receive a NJ Certification Number.

    3. Use your certification number to open a GATS account to track your generation. 

    4. Register an account onInClime (the SREC-II Administrator) to receive payment.

    Learn more about SRECs

    In addition to the great rebates and incentives above, New Jersey also offers tax exemptions for solar panel systems. The solar sales tax exemption ensures that you won't have to pay a sales tax on your system, while the solar property tax exemption means you don't need to pay a higher property tax for adding solar panels to your house.

    Tax Exemption
    Description
    New Jersey solar sales tax exemptionYou don't need to pay any sales tax on solar energy equipment in New Jersey, saving at least 6.625% of your system costs.
    New Jersey solar property tax exemptionIf you use solar energy as a source of power, you won't need to pay more for the value your solar panels add to your property.

    If you connect your solar panel system to the grid, you can benefit from net metering, one of the best solar panel incentives available in New Jersey. With net metering, you earn credits when you send excess electricity from your solar panels to the grid. When the sun isn't shining and you need to pull electricity from the grid, your utility will apply the credits to your bill. Net metering makes it so you will owe very little, or even nothing, on your electric bills with solar panels. 

    Under New Jersey’s net metering program, you’ll earn credits at the retail rate of electricity for each kWh of electricity your system produces up to 100% of your annual utility electricity demand. If you send more electricity to the grid than you demand over the course of a year, you’ll be credited at the wholesale rate for your excess generation. For example, let’s say you send 100 kWh of solar power to the grid and receive 80 kWh of utility-generated electricity to your home. You’d earn 80 credits at the retail rate of electricity, but the other 20 kWh of excess generation would be credited to you at the wholesale rate. 

    Learn more about these net metering programs:

    Jersey Central Power & Light (JCP&L) PSE&G Orange & Rockland Atlantic City Electric

    New Jersey doesn't currently offer any state-specific battery incentives. However, all batteries above 3 kWh in size are eligible for the 30% federal tax credit. In New Jersey, batteries can also boost energy independence and provide backup power during an outage.

    Learn more about battery incentives and rebates See the complete list of solar companies in New Jersey

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