Princeton, NJ

New Jersey’s Property Tax Exemption offers homeowners a valuable financial benefit when installing renewable energy systems. This state tax exemption allows you to avoid paying additional property taxes on the value that solar panels, wind turbines, fuel cells, or other renewable energy systems add to your home. When you install qualifying equipment, your property tax assessment remains at the pre-installation value, effectively exempting the entire renewable energy system from property taxation.

To qualify, you must submit a written application to your local enforcing agency, who will certify that your system meets the state’s renewable energy standards. The exemption becomes effective for the tax year following certification and continues as long as the system is primarily used for renewable energy production. There are no specific deadlines for applying, but you should submit your application after installation is complete. Keep in mind that your certificate can be revoked if the system was obtained through misrepresentation, is no longer used primarily for renewable energy, or has been significantly altered from the certified design.

New Jersey’s Solar Sales Tax Exemption offers homeowners a significant financial benefit when purchasing solar energy systems. This state incentive exempts all solar equipment purchases from New Jersey’s 6.625% sales tax, providing immediate savings on your solar installation costs. For example, on a $20,000 solar system, you would save approximately $1,325 in sales tax.

This exemption applies to all solar energy equipment including panels, inverters, mounting hardware, and battery storage systems when purchased for residential use. There are no income restrictions or caps on this benefit, and the exemption is available year-round with no application process. Simply inform your solar installer about this exemption, and they will handle the documentation needed to ensure the sales tax isn’t charged on your purchase. This incentive can be combined with other solar benefits like the federal tax credit for maximum savings.

The Successor Solar Incentive (SuSI) Program is a New Jersey state initiative designed to expand solar energy adoption while keeping costs affordable for ratepayers. Launched on August 28, 2021, this program replaced the previous Solar Renewable Energy Certificate (SREC) system and aims to double the state’s solar capacity by adding 3,750 megawatts of new solar generation by 2026.

The SuSI Program consists of two parts: the Administratively Determined Incentive (ADI) for smaller projects (5 MW or less) and the Competitive Solar Incentive (CSI) for larger installations. Under the ADI, residential solar system owners receive $90 for each megawatt-hour (MWh) of electricity their system produces, guaranteed for 15 years. This comes in the form of New Jersey Solar Renewable Energy Certificate-IIs (NJ SREC-IIs). Public entities like schools and municipalities receive an additional $20/MWh bonus. While lower than the previous SREC value of approximately $220, these incentives still provide significant financial support for homeowners going solar.

Net Metering in New Jersey is a valuable program that allows solar homeowners to receive full credit for the excess electricity their systems produce. Under this 1:1 net metering arrangement, when your solar panels generate more electricity than you’re using, that excess power flows back to the grid, and you receive credits on your utility bill at the same retail rate you would normally pay for electricity. This essentially allows your electric meter to run backward when you’re producing more than you’re consuming.

All major New Jersey utilities participate in this program, including PSE&G, Atlantic City Electric, Jersey Central Power & Light, and Orange & Rockland (Rockland Electric). Excess credits accumulate month to month, giving you the benefit of solar production during sunny periods to offset your usage during less sunny times. At the end of your annual billing cycle (your anniversary month, which defaults to your permission-to-operate date), any remaining unused credits are paid out at the avoided cost rate (approximately 3-5 cents per kilowatt-hour), and your credit balance resets to zero. Homeowners should note they can change their anniversary month once by contacting their utility, which might be beneficial for maximizing the value of their solar investment.