While New Jersey might not seem like the most likely geographic location for solar installations, the state's aggressive incentive and rebate programs made it the second strongest state in the country for solar installation in 2011. Thousands of homeowners called their New Jersey solar installer to get started last year and the pace doesn't seem to be slowing much in 2012.
New Jersey waives sales tax for solar panels, reduces property tax, provides rebates and offers production incentives to commercial and residential properties that purchase renewable energy systems. The financial incentives range from $100 to thousands, depending on the system and the program.
The state was one of the first to enact a renewable energy portfolio standard. Utility companies are required to get 20.38 percent of their power from Class I and II renewable energy sources by 2021 and 4.1 percent from solar sources by 2028.
To ease pressure on utilities that will have more difficulty achieving the required mix of renewable power generation, New Jersey also developed a Solar Renewable Energy Certificate Registration program that allows utilities whose production portfolio does not meet the mandate to certificates from renewable energy producers to offset their non-renewable production.
Property Tax Incentive
Sales Tax Incentive
State Grant Program
State Loan Program
State Rebate Program
Utility Grant Program
Utility Loan Program
Utility Rebate Program
Related Programs & Initiatives
The U.S. Department of Energy's Alternative Fuels and Advanced Vehicles Data Center (AFDC) provides information and resources on alternative fuels and other petroleum-reduction options, such as advanced vehicles, fuel blends, idle reduction and fuel economy. The AFDC site offers a database of state and federal laws and incentives related to alternative fuels and vehicles, air quality, fuel efficiency, and other transportation-related topics.
The U.S. Department of Energy's Green Power Network provides news and information on green power markets and activities, including opportunities to buy green power. This site provides state-by-state information on green power marketing and utility green power programs. In addition, the site lists marketers of renewable energy credits (RECs), also known as green tags or renewable energy certificates, which represent the environmental attributes of the power produced from renewable energy projects.
The U.S. Department of Energy's Weatherization Assistance Program (WAP) enables low-income families to reduce their energy bills by making their homes more energy-efficient. Through this program, weatherization service providers install energy-efficiency measures in the homes of qualifying homeowners free of charge. The WAP program web site offers a state-by-state map of opportunities, projects and activities.
The U.S. Department of Energy's Wind Powering America site provides state-by-state information on wind projects and activities, including wind working groups, validated wind maps, anemometer loan programs, small wind guides, state-specific news, wind for schools, workshops and web casts.
|Program Type||Property tax excemption|
|Technologies||Solar Water Heat, Solar Space Heat, Solar Thermal Process Heat, Photovoltaics, Landfill Gas, Wind, Biomass, Hydroelectric, Geothermal Electric, Fuel Cells, Geothermal Heat Pumps, Resource Recovery, Tidal Energy, Wave Energy , Direct-Use Geothermal Energy|
|Amount||100% exemption for the value of the qualifying systems|
|Required Documentation||Must complete an application form and have the system assessed by the local assessor|
|Official Web Site||www.dsireusa.org/incentives/incentive.cfm?Incentive_Code=NJ25F&re=1&ee=1|
New Jersey property owners can get a property tax exemption for 100 percent of the value of their renewable energy systems.
Eligible renewable energy systems include solar photovoltaics (solar panels), wind, fuel cells, sustainable biomass, geothermal electric, landfill gas, hydroelectric, resource recovery, wave, and tidal systems that produce electricity. Systems that produce energy from solar thermal energy (e.g., solar hot water) or geothermal energy (e.g., geothermal heat pumps) are also eligible.
The value of the exemption is set by the local property tax assessor and then subtracted from the assessed value of the property where it's installed, reducing the amount of property tax owed.
by the NJ Board of Public Utilities and the Commissioner of Community Affairs.
For more information on the tax incentive, property owners should talk to their local assessor's office.
|Program Type||Production Incentive|
|Technologies||Solar Panels (Photovoltaics|
|Amount||Varies depending on market value; Approximately $490/MWh in April 2009, but trades up to $680/MWh have been reported.|
|Required Documentation||Documentation must be submitted within 120 days of purchasing the system|
|Official Web Site||www.njcep.com/srec|
The SREC Registration Program creates a marketplace that enables producers of solar electric power to be compensated for the power they produce.
Under NJ law, electric utilities who serve retail customers must produce 20.38 percent of their electricity from renewable sources. Utilities who do not produce sufficiently from renewable sources are allowed to purchase Solar Renewable Energy Certificates to offset their non-renewable production and reach their mandate.
Property owners who install solar have to register their project with the SREC program before its under construction in order to be eligible. Once they begin producing solar powe, they can sell certificates to utilities seeking offsets. The program tracks the amount of electricity produced, issues certificates and records sales of certificates from producers to purchasers.
Since the program is a marketplace, companies pay varying amounts for the certificates depending on supply and demand. Suppliers are given a certificate for each megawatt hour produced.
|Technologies||Heat Pumps, Air Conditions|
|Required Documentation||Documentation of proper sizing and installation is required|
|Official Web Site||www.njcleanenergy.com/residential/programs/cooladvantage/cooladvantage-program|
The COOLAdvantage program provides rebates for energy-efficient central air conditioners and heat pumps. The rebate also applies to proper system sizing and other "best practices" that affect operating efficiency. As of July 27, 2012, rebate amounts are fixed at $500 per system.
|Program Type||Sale Tax Exemption|
|Technologies||Passive Solar Space Heat, Solar Water Heat, Solar Space Heat, Solar Thermal Electric, Solar Thermal Process Heat, Photovoltaics, Solar Pool Heating|
|Amount||No maximum limit|
|Who It Applies To||Commercial, Industrial, Residential|
|Official Web Site||www.njcep.com/srec|
New Jersey offers a full sales tax exemption on all solar equipment. The exemption eliminates the state's normal 7 percent sales tax and reduces the effective cost of solar equipment.
|Program Type||Net Metering|
|Technologies||Solar Thermal Electric, Photovoltaics, Landfill Gas, Wind, Biomass, Geothermal Electric, Anaerobic Digestion, Tidal Energy, Wave Energy, Fuel Cells using Renewable Fuels|
|Amount||No limit specified|
|Who It Applies To||Commercial, Industrial, Residential customers of investor owned utilities|
|Required Documentation||Must have an interconnection agreement with the electric utility|
|Official Web Site||www.njcleanenergy.com/renewable-energy/programs/net-metering-and-interconnection|
NJ’s net metering law enables customers to get full retail credit on their utility bill for each kilowatt hour of electricity produced in excess of their demand.
The utility tracks the difference between usage and production for each customer. For each customer who produces electricity, the kilowatts produced in excess of demand are credited to the customer’s account. The customer can draw on their credits to pay for usage during periods when their demand exceeds their production. At year-end, any balance in the customer account is paid to the customer at the wholesale price for electricity.
An interconnection agreement governs the relationship between the electric customers and their utility. The agreement specifies the technical, safety and testing requirements needed to connect the customer’s system to the electric grid.
To qualify, electric systems cannot produce more than 2 megawatts and cannot exceed the customer’s annual electric demands.
As of July, 2012, public entities such as state and local governments and school districts are required to aggregate their solar facilities. And the solar facilities have to be located on land the entity owns and the systems have to be owned and operated by a signle entity.