2023 Solar Incentives Guide for Old Bridge, NJ - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in Old Bridge?

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

The term "solar incentives" generally refers to financial incentives that are in place to encourage increased use of renewable energy by making the installation and use of solar panels more affordable. Various types of incentives, such as cash back, discounts or monthly utility bill credits, might be available to you. Some incentives may be provided via the New Jersey government, by your utility company or by county or municipality, while other incentives are federal. You might qualify for any of the following types of solar incentives:

• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives might be available to you if you have a solar system that produces over a specified (typically small) amount of electricity. This category of incentives is usually handled at the state level. You can sell your SRECs to your utility company or other buyers, and the money you make is usually considered part of your taxable income.
• Net Metering: Net metering becomes relevant once your solar panels are up and running. If you have a net metering agreement in place with your Old Bridge utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other places you might be refunded a percentage of the value.
• Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government. (A tax credit is different from a tax deduction.)
• Rebates: Solar companies may help you claim a rebate, or partial refund of your purchase, for your solar system. States or counties will also offer limited-time rebates at various times. The value of a rebate will usually come off your total price before tax credits are calculated.
• Tax Exemptions: Your solar system may qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions let you ignore the value added by your solar panels when you are calculating property taxes on your house.

Federal Solar Incentives

When you think about solar incentives, you probably think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is probably the most commonly known federal solar incentive. The ITC offers a tax credit for a specific percentage of your solar system's cost.

The ITC can be applied to solar panels installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Originally, the tax credit was for 30% of the total cost — for panels, equipment, labor and accessories — although that amount may range from 26-30%, depending on the installation date of your solar system. There is no cap on the amount you can claim.

To know exactly how much the ITC could save you, talk to your local Old Bridge solar panel installer.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now dubbed the Clean Energy Credit. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. After 2032, the percentage will see a slight decrease annually until the end of the program in 2035. Starting in 2023, it will also be easier to claim credits for energy storage systems under this new program.

More information about the new Inflation Reduction Act can be found here. The best way to understand how the new Clean Energy Credit applies to you is to speak with your local Old Bridge solar panel company directly.

State & Local Solar Incentives

Tax credits, rebates and more can be claimed at multiple levels. Along with federal solar incentives, there are often state and local ones as well. Certain incentives are ongoing, while others are only available for a limited time. Incentives may be given by the New Jersey government, or by your county or municipality.

Next Steps for Installing Solar in Old Bridge

Solar incentives may come from your local utlity company, the New Jersey government or the federal government. The growing number of available solar incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Call your local solar panel installer today to learn more and to save the most money possible on solar panels for your Old Bridge home.