2023 Solar Incentives Guide for Rahway, NJ - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Rahway.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Rahway?
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
Loans
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)
COOLAdvantage Program
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
Combination Rebate
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
Source: https://www.dsireusa.org/
Solar incentives encourage homeowners to make the switch to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. You may be eligible for several types of incentives, such as discounts, cash back or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of New Jersey and others from the federal government. Some broad categories of solar incentives include:
- Net Metering: Net metering factors in once your solar system is up and running. If you have a net metering agreement in place with your Rahway 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 others you may be refunded a percentage of the value.
- Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce more than a specified (normally small) amount of electricity will qualify for SRECs or other performance-based incentives. SRECs and the like are typically offered at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
- Rebates: A rebate is a partial refund given after you've purchased your solar system. Rebates could be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the government.
- Tax Exemptions: These may come in the form of property tax exemptions, which let you ignore the value added by your solar panels when calculating the taxes you pay on your home. They may also include exemptions on sales tax at the time of purchase.
Federal Solar Incentives
When someone says "solar incentives," you probably think of federal incentives first. One of the incentives many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a specified percentage of your solar system's cost.
The ITC is applied to the total cost of solar system installation, including the panels themselves as well as accessories, equipment and labor. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.
Your local Rahway solar panel installer can give you more information about the ITC and how it applies to your situation.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now titled the Clean Energy Credit. The Clean Energy Credit has increased the current credit up to 30% for solar systems installed between 2022 and 2032. At this point, the credit percentage will decrease slightly each year until the program expires in 2035. Beginning in 2023, it will also be easier to get credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. Your local Rahway solar panel installer can answer your questions and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
Federal solar incentives are not your only option; rebates, tax credits and more might also be offered at the local or state level. These solar incentives — which might be given by the state of New Jersey, or by your county or municipality — could be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Rahway
There are a number of different solar incentives: those offered by local utility companies, those offered by the federal government and those offered by the New Jersey government, to name a few. Solar energy use has increased tremendously in the last 15 years, partially due to these incentives. Contact your local solar panel installation company today to discover more about the various programs and to save as much money as possible on solar panels for your Rahway home.
Best Regional Coverage
Momentum Solar
- Great warranty coverage
- Representatives are experts on local policies
- Concierge service ensures steady communication
- Slightly limited service offerings
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
EcoWatch's Rahway, NJ Solar Incentives FAQs
Can I get any financial incentives when I add solar panels to a vacation home, rental property or commercial property?
Many solar incentives apply to a property you own that is located within the United States; most secondary residences will fall into this category. Other solar incentives may be available for commercial properties, depending on the specifics. We recommend talking to your local solar installer and/or tax professional to fully understand what incentives apply to your specific situation.
How can I find out if I qualify for different solar incentives?
Typically, solar incentives apply to:
- a new solar panel system
- installed on property you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including ones handled by the New Jersey government or by your county/municipality, could have additional qualifications. Speak with your local Rahway solar installer to learn more about what incentives your project may qualify for.
How much will a solar system save me annually on my electric bill in Rahway?
Once you add solar panels to your home in Rahway, you can expect to save about $765.21 per year, or about $14,538.97 over the next 20 years.
How long until the federal solar tax credit ends?
The federal solar tax credit, previously called the ITC and now called the Clean Energy Credit, is slated to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
I want to switch my appliances out for ones that are more energy-efficient. Are there any incentives I can apply for?
With the passage of the new Inflation Reduction Act, there are several new financial incentives to encourage you to make eco-friendly improvements to your home. More details on these incentives, including information about incentives for purchasing new appliances, can be found here.
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.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.