2023 Solar Incentives Guide for Park Ridge, NJ - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in Park Ridge?

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. You might qualify for several kinds of incentives, including discounts, cash back 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. Some solar incentives you might qualify for are:

• Rebates: Some solar companies will help you claim a rebate, or partial refund of your 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 your total price before any tax credits are calculated.
• Tax Exemptions: These might come in the form of property tax exemptions, which can let you exclude the value of your solar system when paying property tax on your house. You could also look for exemptions on sales tax at the time of purchase.
• Tax Credits: Tax credits lower, dollar-for-dollar, the total amount of tax you owe the government. These differ from tax deductions.
• Net Metering: Net metering is an incentive you can get after your solar system is up and running. If you have a net metering agreement with your Park Ridge utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in others you might make back a percentage of the value.
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives might be available to you if the solar system on your home produces over a specified (generally small) amount of electricity. This category of incentives is normally handled at the state level. You can sell your SRECs to your utility company or other buyers, and the money you receive in return is usually considered part of your taxable income.

Federal Solar Incentives

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

The ITC can be credited towards the value of solar panels 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 you own for you to claim the credit. The ITC originally paid out 30% of all system installation costs (panels, labor, equipment and accessories), although the covered amount has fluctuated over the last few years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the amount you can claim.

Your local Park Ridge solar panel installer can provide you with more information about the ITC and how it may apply to your situation.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners may be eligible for a credit equal to 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit expires 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. Your local Park Ridge solar panel installation expert is the best person to answer your questions regarding the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

There are more than just federal solar incentives; tax credits, rebates and more are often offered at the local or state level. These incentives might be offered by your county or municipality, or by the New Jersey government. Some are ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Park Ridge

Solar incentives can come from the New Jersey government, the federal government or your local utility company. The large number of incentives available has contributed to a large increase in solar energy use in the last 15 years. If you're prepared to make the switch to solar energy, reaching out to your local Park Ridge solar panel installation expert is an excellent place to start.