There is a good reason why homeowners are going solar in New Jersey. Homeowners are doing it because of the incentives in New Jersey. New Jersey is #5 in the country for the number of solar installations over time, and it will remain at the top of the list for many years to come. The average cost for a solar installation in New Jersey is approximately $30,000. Obviously, not every homeowner has that amount of cash to put into solar panels, yet over 100,000 solar installations have been completed in New Jersey.
The incentives and the access to $0 down solar programs are why your neighbors are going solar. In fact, New Jersey has some of the best incentives in the country. The state has 2 core programs – one that rewards residents for the electricity’s clean characteristics and one that compensates residents for the electricity they produce.
Solar Renewable Energy Certificate (SREC)
When your solar energy system produces electricity, it also generates one Solar Renewable Energy Certificate. You can sell the SREC to utilities to help them meet the RPS or New Jersey Renewable Portfolio Standard. One SREC signifies one megawatt of electricity produced from the solar energy system. In New Jersey, you get about 6 SRECs every year. Although prices vary throughout the year, on average, homeowners can make about $170 from selling an SREC. If you have a 5kW system that produces 5 MWh yearly, you could earn as much as $1,400 every year by selling your SRECs.
New Jersey also provides tax breaks to those who have solar energy system. One of these is the solar sales tax exemption. When you buy a home solar system, you will get a 100% sales tax exemption, and this means saving more money. New Jersey residents who have solar energy systems are not required to pay extra taxes on the value that the solar panels are adding to their property.
Aside from these tax exemptions, you can also benefit from the federal ITC or Investment Tax Credit. It reduces the solar energy system’s cost by 30%. You will save a lot of money when you file your federal income tax. However, the Investment Tax Credit only applies to those who purchase their solar energy system outright. You must also have enough income to enjoy the tax credit.
New Jersey Net Metering
You can sell excess electricity to the grid. The rate of New Jersey’s net metering is higher than the wholesale rate received by large power plants for the electricity they sell to the grid. The ability to sell and buy electricity also gives you the freedom to balance your production and consumption. Any excess electricity produced by your system won’t go to waste.
Use a Loan to Pay for Your Solar Energy System
As long as you have home equity, you can own solar panels and enjoy its benefits. You can get a loan to pay for the system and earn tax breaks, energy savings and SRECs to offset the loan payments. You can qualify for a solar loan with a 15-year repayment period and a fixed rate of 4% or even lower.