2023 Solar Incentives Guide for City Of Orange, NJ - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in City Of Orange?

Source: https://www.dsireusa.org/

The term "solar incentives" refers broadly to financial incentives implemented by the government and by solar companies to encourage increased use of renewable energy by making installing and using solar panels more affordable. Solar incentives can include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the New Jersey government and some by your utility company, county or municipality. Types of solar incentives might include:

• Rebates: Your solar installer might help you claim a rebate, or partial refund after purchase, for your solar panels. Counties or states will also sometimes offer limited-time rebates. The value of a rebate will usually be deducted from the total price before tax credits are calculated.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
• Net Metering: You can sign a net metering contract with your City Of Orange utility company that will apply to all or a percentage of the excess electricity your solar panels generate. They will then deduct this value from your monthly utility bill.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives may be available to you if your solar system produces over a specified (usually small) amount of electricity. These types of incentives are generally handled by the state government. You can sell the SRECs you receive to your utility company or other buyers, and the money you receive in return is usually considered part of your taxable income.
• Tax Exemptions: These could come in the form of property tax exemptions, which allow you to exclude the value of your solar system when paying property tax on your home. They may also include exemptions on sales tax at the time of purchase.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge of. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a predetermined percentage of the cost of your solar system.

The ITC initially applied to 30% of the total cost of installing a solar system, although that number has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of equipment, accessories and labor. There is no maximum amount you can claim. The ITC applies to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.

Wondering how the ITC applies to your specific situation? Contact your local City Of Orange solar panel installer to get more information.

The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit is valid until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit. The amount will then decrease slightly each year until the current program ends. Starting in 2023, it will also be easier to qualify for credits for energy storage systems under this new program.

More information about the new Inflation Reduction Act can be found here. To best understand how the new Clean Energy Credit will apply to you, get in touch with your local City Of Orange solar installers.

State & Local Solar Incentives

Some solar incentives are often also provided at the state and local level. Like with federal incentives, these could include tax credits, rebates and more. These incentives — which might be handled by the state of New Jersey, or by your county or municipality — may be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in City Of Orange

The expanding number of solar incentives available has helped tremendously increase the nationwide adoption of solar energy over the last 15 years. You may receive solar incentives from your local utility company, the federal government or the New Jersey government. Contact your local solar panel installer today to learn more and to save the most money possible on solar panels for your City Of Orange home.