2023 Solar Incentives Guide for Newark, NJ - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Newark.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Newark?
Solar Energy Sales Tax Exemption
Successor Solar Incentive (SuSI) Program
Small Net-Metered Non-Residential located on Rooftop, Carport, Canopy and Floating Solar
Projects smaller than 1 MW (dc): $100/SREC-II, $120 for public entities
Projects 1 MW to 5 MW (dc): $90/SREC-II, $110 for public entities
Net Metered Non-Residential Ground Mount
Projects smaller than 1 MW (dc): $85/SREC-II, $105 for public entities
Projects 1 MW to 5 MW (dc): $80/SREC-II, $100 for public entities
Community Solar LMI: $90/SREC-II
Community Solar Non-LMI: $70/SREC-II
Property Tax Exemption for Renewable Energy Systems
Solar Renewable Energy Certificates (SRECs) Registration Program
In June 2016, SREC traded at an average price of $229.90.
PSE&G - Solar Loan Program
NJ Clean Energy- Residential New Construction Program
Single family homes: Ranges from $1,125 to - 24,250
Multi-single homes: Ranges from $1,125 to $18,188
Multifamily homes: Ranges from $625-$12,125
Home Performance with ENERGY STAR Program
Single family : $2,000 to $4,000
Multi-family : $500-$1,500 per unit
Rebates for single family and multi-family should not exceed 50% of the cost of the measures used to calculate total estimated savings (TES)
See table below for details
Single-family: $5,000 (Tier II) or $10,000 (Tier III) 4.99% interest loans up to $15,000 (where utility 0% financing is unavailable)
Ductless Mini Split A/C or Heat Pump: $500
Air Source Heat Pump: $300 (Tier 1), $500(Tier 2)
Geothermal Heat Pump: $500
NJ Clean Energy- WARMAdvantage Program (Electric and Gas)
Solar Hot Water Heater: $1,200
Heat Pump Water Heater: $500
Geothermal Heat Pump: $500
Air-Source or Ductless Mini-Split Heat Pump: $300- $500
Residential Gas Customers (including propane):
Gas Furnace: $250- $500
Gas Boiler: $300
Gas Water Heater: $300
Solar Hot Water Heater: $1,200
Oil Heating Customers:
Oil Furnace: $250
Oil Boiler: $300
Boiler and Water Heater Combination Rebate: $700
Furnace and Water Heater Combination Rebate: $700- $950
New Jersey Renewable Energy Incentive Program (Sustainable Biopower)
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" generally refers to financial incentives that are in place to encourage the use of renewable energy by making installing and using solar panels more affordable. You might qualify for various kinds of incentives, such as cash back, discounts or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the New Jersey government and others from the federal government. You might qualify for any of the following types of solar incentives:
- Rebates: A rebate is a partial refund given after you've purchased your solar panels. These may be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
- Tax Exemptions: Tax exemptions may come in one of two forms. The first is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when calculating property tax for your house.
- Net Metering: You can sign a net metering agreement with your Newark utility company, that may apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then deduct this value from your monthly utility bill.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
- 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 normally handled by the state government. You can sell SRECs to your utility company or other buyers, and the money you make is generally considered part of your taxable income.
Federal Solar Incentives
When thinking about solar incentives, you probably think of federal incentives first. An incentive that most people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a certain percentage of your solar system's cost.
The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar system must have been installed after January 1, 2006 on a property owned by you for you to be eligible for the credit. Originally, the ITC covered 30% of all system installation costs (panels, labor, equipment and accessories), although the amount has fluctuated slightly over the years between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the claim amount.
To better understand exactly how much money the ITC could save you, talk to your local Newark solar panel installer.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners can apply for a credit equal to 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit ends in 2035. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local Newark solar panel company can answer any questions you have and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
In addition to those provided at the federal level, there are often also state solar incentives. Rebates, tax credits and more may be available at a more local level. Some incentives are offered for only a limited time, while others are ongoing. Your local solar incentives might come from the New Jersey government, or from your specific county or municipality.
Next Steps for Installing Solar in Newark
The large number of available solar incentives has enormously increased the adoption of solar energy nationwide over the past 15 years. You may receive solar incentives from your local utility company, the federal government or the New Jersey government. Speak with your local solar panel installation company today to learn more and to save the most money possible on solar panels for your Newark home.
EcoWatch's Newark, NJ Solar Incentives FAQs
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.