2023 Solar Incentives Guide for West Milford, NJ - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in West Milford.
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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What Solar Tax Credits, Incentives, and Rebates are Available in West Milford?
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.
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 term "solar incentives" broadly refers 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 be eligible for various types of incentives, including 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. Types of solar incentives might include:
- Rebates: Solar rebates may be provided by your county or state, or by your local utility company. These rebates work as cash back that is applied after your purchase of a solar system and before tax credits are calculated.
- Tax Exemptions: Your solar panel system could qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions allow you to ignore the value added by your solar panels when calculating property taxes on your home.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
- Net Metering: Net metering factors in after your solar panels are up and running. If you've signed a net metering agreement with your West Milford 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 areas, this is a dollar-for-dollar credit, while in other areas you may receive a refund equivalent to a percentage of the value.
- Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a specific (normally small) amount of electricity qualify for SRECs or similar performance-based incentives. SRECs and similar incentives are typically given by your state government. You can sell SRECs to your utility company or another buyer, and this is usually considered part of your taxable income.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some familiarity with. A federal incentive that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a certain percentage of your solar system's cost.
The ITC applies to the value of solar panels installed on your primary or secondary residence in the United States. The solar system has to have been installed on a property you own after January 1, 2006 for you to be eligible for the credit. Initially, the ITC applied to 30% of all system installation costs (panels, labor, equipment and accessories), although this amount has fluctuated slightly over the 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.
To better understand how the ITC may apply to you, contact your local West Milford solar panel installer and request more information.
The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Homeowners are now eligible for a credit of 30% of the total costs of solar system installation for projects started after January 1, 2022 and completed before the end of 2032. The credit percentage will then decrease on a yearly basis until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems under the new laws.
Click here to learn more about the new Inflation Reduction Act. Your local West Milford solar panel installation experts can answer your questions and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
Some solar incentives are often also provided at the state and local level. As with federal incentives, these may include rebates, tax credits and more. Incentives may be handled by the state of New Jersey, or by your county or municipality. Certain incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in West Milford
There are many kinds of solar incentives: those given by local utility companies, those given by the New Jersey government and those given by the federal government, to name a few. The use of solar energy has grown tremendously in the last 15 years, thanks to these incentives. Getting in touch with your local West Milford solar panel installer is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
EcoWatch's West Milford, NJ Solar Incentives FAQs
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