- New Jersey residential power runs about 23.49 cents per kWh (EIA, as of March 2026), above the national average, so the bill PSE&G solar offsets is meaningful.
- PSE&G net metering credits exports at the full retail rate, one-for-one, up to about your annual usage; credits bank month to month (PSE&G net metering).
- The catch is the annual true-up: once a year PSE&G cashes out any leftover credits at a lower wholesale market price, not the retail rate, so sizing a system to your usage matters.
- You also earn SREC-II payments: New Jersey’s statewide SuSI program pays about $85 per SREC-II (one per 1,000 kWh) for 15 years on top of net metering, for systems registered through May 2026 (DSIRE).
- To connect, you need Permission to Operate (PTO) from PSE&G before switching the system on.
- PSE&G is New Jersey’s largest electric utility, serving about 2.4 million electric customers across much of North and Central New Jersey.
- The 30% federal homeowner credit (Section 25D) ended for expenditures made after December 31, 2025 (IRS).
If PSE&G is your electric utility in New Jersey, this is how rooftop solar pays you back in 2026. PSE&G follows New Jersey’s net-metering rules and credits the power you export, and on top of that you can earn the state’s SREC-II payments for years. New Jersey’s high rates make the math work. This page explains what PSE&G pays, how to connect, and how to tell if your home is a good fit.
PSE&G New Jersey at a glance
PSE&G, part of PSEG, runs the net-metering and interconnection process in its New Jersey territory, while the SREC-II incentive is a statewide program you also tap into. Our guide to New Jersey net metering and the SREC-II rate runs the full stacking math.
| Detail | What to know |
|---|---|
| Service territory | Most of North and Central New Jersey, including Newark, Jersey City, Paterson, Elizabeth, and Trenton |
| Electric customers | About 2.4 million, the largest in New Jersey |
| Net metering | Full retail 1:1 credit up to about your annual usage; credits bank monthly |
| Annual true-up | Leftover credits cashed out once a year at a wholesale price, not retail |
| SREC-II (statewide SuSI) | About $85 per SREC-II (one per 1,000 kWh) for 15 years, on top of net metering |
| Before you switch on | PSE&G must grant Permission to Operate (PTO) |
| Source | PSE&G net metering |
Two ways your PSE&G solar pays. First, net metering offsets your bill at the full retail rate for the power you export, up to about your yearly usage. Second, the statewide SuSI program pays you separately for production, about $85 for every 1,000 kWh your system makes, for 15 years. The two stack, which is why New Jersey is a strong solar state even now that the federal homeowner credit has ended. Estimate your roof’s likely output with NREL’s free PVWatts calculator, since production drives both your bill credits and your SREC-II income.
How PSE&G credits the power you send back
Net metering is full retail, but the annual true-up is not. When your panels make more than your home uses, the extra goes to the grid and PSE&G credits it at the same retail rate you pay, one kilowatt-hour for one kilowatt-hour. Those credits roll forward month to month inside a 12-month contract year. The detail to understand is the Anniversary True-Up: at the end of that year, PSE&G values any leftover credits at New Jersey’s Clean Energy Program wholesale market price, which is set by hourly PJM prices and excludes delivery and system charges, then resets your credit balance to zero (PSE&G net metering). Because that year-end rate is well below retail, the smart move is to size a system close to your annual usage rather than oversize it. For the mechanics of export credits, see how net metering credits your solar exports.
| What you earn | How it is valued | Who receives it |
|---|---|---|
| Monthly net-metering credits | Full retail rate, one-for-one, up to about your annual usage | The customer of record on the PSE&G account |
| Year-end surplus (true-up) | A lower wholesale market price, not retail | The customer of record |
| SREC-II payments (SuSI) | About $85 per 1,000 kWh, for 15 years | The registered system owner |
To see how the bill credit lowers your monthly cost, read how solar lowers your electricity bill, and to weigh payback, see the financial case for whether solar panels are worth it.
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How to connect solar to PSE&G in New Jersey
Connecting a home system to PSE&G follows a set order, and the key rule is that you cannot turn the system on until PSE&G issues Permission to Operate. The general path is:
- Interconnection application. You or your installer file a net-metering and interconnection application with PSE&G. Systems up to 10 kW use the simplest Level 1 path with no application fee; larger systems use Level 2 or 3, which carry a fee.
- Engineering review and approval. PSE&G reviews the application, often within a few weeks. You should not start construction until you have that approval.
- Install and inspect. The system is installed and passes your local Uniform Construction Code (UCC) electrical inspection.
- Meter swap. Once PSE&G has proof of inspection, it installs a bidirectional (net) meter that measures both the power you use and the power you export.
- Permission to Operate (PTO). PSE&G issues PTO. Do not energize the system before this, since the system only starts earning credits once it is approved to run.
A licensed installer normally manages this whole process for you, but knowing the order helps you spot a quote that promises an instant switch-on. For the questions to ask, see the right questions to ask a solar installer.
What changed federally, and what it means for PSE&G customers
The federal homeowner credit is gone, but New Jersey’s programs 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 PSE&G customer who buys solar with cash or a loan in 2026 cannot claim it (IRS OBBB FAQ; SEIA). PSE&G net metering and the statewide SuSI / SREC-II payments were not affected, and together they carry the payback in New Jersey. For the full timeline, see what the federal solar tax credit change means 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 on a PSE&G account 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 PSE&G territory
Much of North and Central New Jersey is PSE&G territory, so you have 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 experience with PSE&G interconnection and the New Jersey SuSI registration, so the paperwork and PTO go smoothly.
- A written production estimate and a transparent quote that includes your expected SREC-II income. 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.
Looking at the specifics? See local solar guides for Trenton, Paterson, New Brunswick, Princeton, Plainfield, and Camden in this service area.
Weighing your options across the area? Compare nearby New Jersey solar markets with our local guides for Edison, Elizabeth, Clifton, and Cherry Hill.
Frequently asked questions
How does PSE&G net metering work in New Jersey?
PSE&G credits the power you export at the full retail rate, one kilowatt-hour for one kilowatt-hour, up to about your annual usage, and those credits bank month to month within a 12-month contract year (PSE&G net metering). At the Anniversary True-Up once a year, PSE&G values any leftover credits at New Jersey’s Clean Energy Program wholesale price, which is lower than retail and excludes delivery charges, then resets your balance. Because the year-end rate is low, the best results come from sizing a system close to your yearly usage rather than oversizing it.
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 PSE&G customer 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. PSE&G net metering and New Jersey’s SREC-II payments were not affected. See our guide on what the federal solar tax credit change means in 2026.
Do PSE&G customers earn New Jersey SREC-II payments?
Yes. SREC-II payments come from New Jersey’s statewide Successor Solar Incentive (SuSI) program run by the Board of Public Utilities, not from PSE&G, so PSE&G customers are fully eligible (DSIRE). A net-metered residential system earns one SREC-II for every 1,000 kWh it produces, valued at about $85 each for 15 years, paid on top of net metering. The $85 rate is set for systems registered through May 2026 and is reset each year by the BPU, and the payments go to the registered system owner, so a lease or PPA customer does not receive them.
How do I connect solar to PSE&G?
You or your installer file a net-metering and interconnection application with PSE&G, PSE&G reviews and approves it, the system is installed and passes a local inspection, PSE&G swaps in a bidirectional meter, and then PSE&G issues Permission to Operate (PSE&G net metering). You cannot turn the system on until you have PTO. Systems up to 10 kW use the simplest Level 1 process with no application fee, and a licensed installer usually handles the paperwork for you.
How much does PSE&G pay for the power I send back?
During the year, PSE&G credits your exported power at the full retail rate, one-for-one, up to about your annual usage, so each exported kilowatt-hour offsets one you would otherwise buy. The exception is the once-a-year true-up, when any surplus you did not use is cashed out at a lower wholesale market price rather than the retail rate (PSE&G net metering). On top of those bill credits, the statewide SuSI program pays you separately for production through SREC-II payments.
Do I qualify for PSE&G solar credit if I lease or sign a PPA?
Net-metering credits follow the PSE&G account, so the customer of record gets them whether you own, lease, or sign a PPA. The SREC-II payments and New Jersey’s tax exemptions go to the registered system owner, so on a lease or PPA the third-party company keeps the SREC-II income, not you, while your benefit is a lower or fixed power price with no up-front cost. If you want the SREC-II income in your own name, owning the system through cash or a loan is the path that captures it.
Reviewed by the MySolarFY team. Figures were verified against the linked New Jersey (PSE&G, NJ Board of Public Utilities, NJ Clean Energy Program), DSIRE, EIA, and IRS sources as of June 2026; net-metering true-up rates and the SREC-II incentive reset over time, so confirm current terms with PSE&G and the NJ Clean Energy Program 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.
