- The state’s SuSI program pays about $85 per SREC-II (one per 1,000 kWh you generate), locked for 15 years from registration (NJ Clean Energy Program; DSIRE).
- New Jersey residential power runs about 23.49 cents per kWh, near the top nationally, which is why solar pays here (EIA, as of March 2026).
- Net metering is 1:1 at the full retail rate, so exported power offsets imported power at your utility’s retail price (NJ Clean Energy Program; PSE&G).
- Solar equipment is 100% exempt from New Jersey’s 6.625% sales tax, and a solar system’s added home value is 100% exempt from property tax (N.J.S.A. 54:32B-8.33; DSIRE).
- The 30% federal homeowner credit (Section 25D) ended for expenditures made after December 31, 2025, so most 2026 buyers cannot claim it (IRS; SEIA).
- Check which incentives apply at your address before you sign anything.
New Jersey homeowners pay about 23.49 cents per kWh for electricity (EIA retail sales, residential NJ, as of March 2026), well above the U.S. average, so cutting that bill is worth real money. New Jersey also runs one of the strongest state incentive stacks in the country, and none of it depends on the federal tax credit that ended after 2025. This page covers what New Jersey actually pays, how net metering works here, and how to tell if your home qualifies.
For a full breakdown of the state and federal incentives a New Jersey homeowner can actually use, see New Jersey solar tax credits in 2026.
Why solar pays in New Jersey
High rates plus a strong state program is the reason. At about 23.49 cents per kWh, a New Jersey home with a $150 to $250 monthly bill offsets expensive grid power with every kilowatt-hour the roof makes. The amount your roof produces is what drives both your bill savings and your SREC-II income, since you earn one SREC-II for every 1,000 kWh generated. Estimate your roof’s likely output with NREL’s free PVWatts calculator, because production depends on your roof’s pitch, orientation, and shading. As an illustration, SolarReviews estimates a 7.5 kW New Jersey system earns roughly 9 SREC-IIs a year (SolarReviews NJ).
New Jersey’s solar incentives at a glance
New Jersey stacks four state-level benefits on top of your bill savings. Here is what each one pays in 2026 and who actually receives it.
| Incentive | What it pays | 2026 value | Who receives it | Source |
|---|---|---|---|---|
| SuSI / ADI (SREC-II) | One SREC-II for every 1,000 kWh generated, for 15 years | About $85 per SREC-II, locked 15 years from registration | The system owner (not lease or PPA homeowners) | NJCEP, DSIRE |
| Net metering | A bill credit for power you export to the grid | Full retail rate, 1:1, varies by utility | The homeowner | NJCEP, PSE&G |
| Sales-tax exemption | Waives state sales tax on solar equipment | 100% of the 6.625% rate, via Form ST-4 | The buyer | N.J.S.A. 54:32B-8.33 |
| Property-tax exemption | Excludes solar’s added value from your assessment | 100% of the added value, applied through your assessor | The owner | DSIRE |
| Federal residential (Section 25D) | A 30% homeowner credit | Ended for expenditures made after December 31, 2025 | No 2026 homeowner-buyer | IRS, SEIA |
The headline is SREC-II income. Under the Successor Solar Incentive (SuSI) program, the Administratively Determined Incentive (ADI) issues one SREC-II for every 1,000 kWh (one megawatt-hour) your net-metered system generates, currently valued at about $85 per SREC-II for new registrations and locked for 15 years from registration (NJCEP). The NJ Board of Public Utilities reviews incentive levels and may reset them roughly every three years through a triennial review, one of which is underway, so confirm the current rate before you sign. These payments go to the system owner, which matters if you lease or sign a PPA.
Heads up: SREC-II payments, the sales-tax exemption, and the property-tax exemption all go to the party that owns the system. If you lease your panels or sign a PPA, the company that owns them keeps those incentives, and your benefit is a lower or fixed power price with no up-front cost. Confirm every figure against the linked NJBPU or NJ Clean Energy Program source before you decide, and ask a tax professional about your situation. MySolarFY does not provide tax advice.
See what solar programs are available in your ZIP code
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Net metering in New Jersey
New Jersey still runs 1:1 net metering at the full retail rate. Every kWh you send to the grid offsets a kWh you pull from it, credited at your utility’s retail rate, until your usage is covered over the annual period. Any surplus left at the end of the 12-month net-metering year is paid out at a lower avoided-cost wholesale rate, not the retail rate (PSE&G net metering; JCP&L net metering). For the mechanics of how export credits work, see how net metering credits your solar exports.
Because the credit equals your retail rate, its cash value depends on which utility serves you. The figures below are approximate 2026 market estimates, not official rates, and they change with each utility’s tariff.
| Utility | Approximate retail credit per kWh (2026 estimate) |
|---|---|
| Atlantic City Electric (ACE) | about $0.30 |
| PSE&G | about $0.27 |
| Rockland Electric (RECO) | about $0.27 |
| JCP&L | about $0.21 |
Source: approximate market estimates (NuWatt); your exact credit is set by your utility’s tariff and rate class. To see how the bill credit lowers your monthly cost, read how solar lowers your electricity bill.
How you pay changes which incentives you keep
The way you finance solar decides who owns the system, and ownership decides who collects the SREC-II payments and tax exemptions. This is the most misunderstood part of a New Jersey solar quote.
| How you pay | Up-front cost | Who owns the system | SREC-II payments | Net metering and exemptions |
|---|---|---|---|---|
| Cash | Full system price | You | You earn them | Yours |
| Solar loan | Little or none, financed over time | You | You earn them | Yours |
| Lease or PPA | $0-up-front where you qualify | A third-party company | The company keeps them | You still see net-metering bill credits |
If you own the system (cash or loan), you keep the SREC-II income, the net-metering credits, and the tax exemptions. If you lease or sign a PPA, the company that owns the panels keeps the SREC-II payments and the exemptions, and your benefit is a lower or fixed power price with no up-front cost. Neither path gives a 2026 New Jersey homeowner the federal residential credit, since that credit ended after December 31, 2025. For a deeper payback comparison, see the financial case for whether solar panels are worth it.
What changed federally, and what it means for New Jersey
The federal homeowner credit is gone, but New Jersey’s incentives are not. The 30% federal Residential Clean Energy Credit (Section 25D) ended for expenditures made after December 31, 2025, under the One Big Beautiful Bill Act, so a New Jersey homeowner who buys solar with cash or a loan in 2026 cannot claim it (IRS OBBB FAQ; SEIA). The state’s SREC-II payments, net metering, and tax exemptions were not affected by that change, and for many homeowners they add up to more than the old one-time federal credit over the life of a system. For the full timeline, see what the federal solar tax credit change means in 2026, and for the paths that still pay in its place, see solar without the federal tax credit in 2026.
One federal exception exists, and it is not yours to claim. A separate commercial credit, Section 48E, is claimed by the business that owns a leased or PPA system, not by the homeowner, and it runs for projects placed in service through 2027, with a begin-construction safe harbor by July 4, 2026 (IRS Clean Electricity Investment Credit; SEIA tax policy). For a leased system in New Jersey you do not file for a federal credit yourself; the company that owns the panels does. The 25D homeowner credit, by contrast, ended after December 31, 2025.
How to choose a solar installer in New Jersey
New Jersey has a deep market of licensed installers. Rather than chasing a “best” list, screen any installer against objective criteria:
- NABCEP certification, the industry’s professional standard for PV installers.
- A valid New Jersey Home Improvement Contractor (HIC) registration and electrical licensing.
- A clear workmanship and equipment warranty in writing.
- Real New Jersey experience and verifiable reviews, plus help registering your system for SuSI and net metering.
- A written production estimate and a transparent quote you can compare. For a checklist, see the right questions to ask a solar installer.
MySolarFY matches you with licensed installers that serve your area so you can compare real local quotes side by side, with no obligation. Exploring a specific New Jersey market? See our local solar guides for Newark, Jersey City, Edison, Princeton, Camden, and Atlantic City. We also have local solar guides for Clifton, Elizabeth, New Brunswick, Paterson, Toms River, Trenton, Cherry Hill, Plainfield, and Morristown.
To see exactly how your utility credits solar, read our net metering guides for PSE&G New Jersey, JCP&L, Atlantic City Electric, and Orange & Rockland, and how New Jersey net metering and SRECs work. For dated cost, production, and payback numbers by city, see our New Jersey solar data and statistics.
Frequently asked questions
What solar incentives does New Jersey offer in 2026?
New Jersey offers four main state benefits on top of your bill savings: SuSI / SREC-II payments of about $85 per SREC-II for 15 years, 1:1 net metering at the full retail rate, a 100% exemption from the state’s 6.625% sales tax on equipment, and a 100% property-tax exemption on the value solar adds to your home (NJCEP; DSIRE). The state has no residential solar income-tax credit; its incentives are production payments, bill credits, and tax exemptions. Confirm the current SREC-II rate with the NJ Clean Energy Program before you sign.
What happened to the federal solar tax credit?
The 30% federal Residential Clean Energy Credit (Section 25D) ended for expenditures made after December 31, 2025, under the One Big Beautiful Bill Act. A New Jersey homeowner who buys solar in 2026 with cash or a loan cannot claim it. A separate commercial credit (Section 48E) can apply to leased and PPA systems, but the business that owns the system claims it, not the homeowner. New Jersey’s own incentives, SREC-II, net metering, and tax exemptions, were not affected. See our guide on what the federal solar tax credit change means in 2026.
How much is an SREC-II worth in New Jersey?
Under the SuSI program’s Administratively Determined Incentive, a net-metered residential system earns one SREC-II for every 1,000 kWh (one megawatt-hour) it generates, currently valued at about $85 per SREC-II and locked for 15 years from registration (NJCEP). SolarReviews estimates a 7.5 kW system earns roughly 9 SREC-IIs a year, about $765, which adds up over the 15-year term (SolarReviews). The Board of Public Utilities reviews the rate about every three years, so verify the current amount before you commit.
How does net metering work in New Jersey?
New Jersey provides 1:1 net metering at the full retail rate, so each kWh you export offsets a kWh you import at your utility’s retail price over the annual period. Any surplus left at the 12-month true-up is paid at a lower avoided-cost wholesale rate, not the retail rate (PSE&G). Because the credit equals your retail rate, its value varies by utility, roughly 21 to 30 cents per kWh in 2026 as an estimate, set by each utility’s tariff rather than by the net-metering rule.
Do I qualify for NJ solar incentives if I lease or sign a PPA?
It depends on the incentive. SuSI / SREC-II payments and the tax exemptions go to whoever owns the system, so on a lease or PPA the third-party company keeps them, not you. What you get instead is a lower or fixed power price with no up-front cost. Net-metering bill credits still reduce your usage charges either way. If keeping the SREC-II income matters to you, owning the system through cash or a loan is the path that captures it.
Is solar worth it in New Jersey?
For many homeowners, yes, because the math is strong here: high retail rates near 23.49 cents per kWh, 15 years of SREC-II income, full-retail net metering, and two tax exemptions (EIA, as of March 2026). Whether it pays for your home depends on your roof, your usage, your utility, and how you finance it. Savings are not guaranteed, so get a written production estimate and compare more than one quote before you decide.
Reviewed by the MySolarFY team. Figures were verified against the linked New Jersey (NJBPU, NJ Clean Energy Program, NJ Division of Taxation), EIA, and IRS sources as of June 2026; incentive amounts and dates change, so confirm current terms with each source before you decide. MySolarFY does not provide tax or financial advice; consult a licensed professional about your own situation. Learn more about the MySolarFY team and how we work.
MySolarFY is a free service that matches homeowners with licensed solar installers. We are not an installer, financing company, or government program. “No up-front cost” refers to qualifying lease or PPA financing, where eligible homeowners may have no out-of-pocket cost at installation. Lease and PPA terms typically run 20 to 25 years, may include an annual price escalator, and total payments may exceed the cost of a cash purchase; on a lease or PPA the SREC-II payments and tax exemptions go to the company that owns the system, not the homeowner. Homeowners do not get the federal residential credit that ended after December 31, 2025. Solar panels are not free and monthly payments apply. Eligibility, savings, incentives, and rates vary and are not guaranteed. See our full disclaimer.
