New Jersey Solar Power Rebates, Tax Credits, and Incentives

Vincent Nestore

Is there and if so a tax credit for solar heating my pool instead of gas or electric? Thanks

JIm

All of these state incentives are good, but a while lot more needs to be done. From a practicle standpoint, in order for solar power to become more readily accepted, it has to be made more cost effective for homeowners.

The return on a typical residential system takes about 15-20 years depending on the size and configuration of the system. The system itself has a life or 20-25 years. Do you see the problem here?

There needs to be more pressure put on manufacturers to come up with ways to make these system more affordable and the return faster and greater for the homeowner. Whether it’s through yearly federal and state tax incentives like what’s being done with the car industry, or more federal dollars for R&D something has to be done to make the technology more affordable and practicle for homeowners.

B. Killpatrick

Thought I just heard on the news about a special financial incentive program to help farmers / agricultural producers in NJ install solar. Can’t be part of the residential incentive program that was defunded in 2007 … Any idea what this is?

headshot zod

Raising property values in NJ usually leads to higher property taxes so you may never recoup your investment.

headshot zod

I must correct myself. I wound up looking into this after I posted. Supposedly in NJ adding solar panels will not give the local municipality the ability to increase your property taxes.

earthbru

So what is actually available today? The rebates are all used up and are not being renewed and the State legislature does not seem to be able to pass a law regarding the SRECS. Perhaps if they could find a way to use this to enable them to borrow another billion dollars against the taxpayers wishes they would be more inclined to do it.

Quong Lew

With the price of energy going up and with no end in site. I would like to install solar panels, but with the cost and life of the photovotaic cells at 25 years, it doesn’t make any sense at this time.

rich

were can i buy them direct ,the pannels ,?? i am overqualifyied to do the work but i am not aposed to saving money

Alice Diane Celebre

Regional: Green Buildings Open House, October 4th
On Saturday, October 4, 2008, from 10:00 a.m. to 4:00 p.m., the Northeast Sustainable Energy Association is welcoming the public to visit local sustainable homes and buildings throughout New Jersey and the Northeast to see clean renewable energy at work. Visitors to these buildings will be able to see how their neighbors and businesses are reducing their carbon footprint and cutting their energy bills through the power of the sun, wind, and smart building design.

The Green Buildings Open House operates in conjunction with the National Solar Tour. Homeowners and facility managers across all 50 states will be showing visitors the latest in recycling, renewable energy technologies, sustainable building materials, and energy efficient appliances.

Take a local tour to learn how you, too, can save by going green.

To find the Green Buildings Open House sites nearest you, visit http://www.nesea.org

Regional businesses, Basil Bandwagon Natural Market, 908-788-5737 (basilbandwagon.com) and Basil Brook Organic Pharm 908-788-6864, will participate in the open house again this year and provide information on Energy Star rated products, solar electric, Solatubes, Solar Star attic fans, passive solar design, solar pool heating, solar hot water, kickbikes, and an all electric car “charged by the sun.”
Posted by Michael Shapiro, Editor at 12:30 AM

d

can anyone enlighten me on yearly maintenance costs to a grid-tied photovoltaic system on a two-story house? i pressume the panels have to be cleaned of dust and debris?

David Llorens

Hi d,

You should try to rinse the panels off about twice a year. If you never rinse them off and let the rain do most of the work, it will not kill your system. Grime is not so awful, the killers are like big maple leaves, bird poop, anything that blocks a large section.

you can get away with never cleaning them if you have no large debris, if you do, you need to regularly clean that stuff off.

Janice

I am adding a room to my home and reconstructing the roof to accomodate it. I’m out of money but would like to incorporate solar energy into the construction. Are there grants out there that would give me enough to put it into my new construction without significant extra cost?

Michael

I have had my system since 2005 and the only time I have noticed it needed cleaning (decreased output) was during pollen season when we had not had rain for some time. A quick spray of the hose took care of washing it off. Unless you live near the shore (salt buildup can be an issue) normal rainfall should be fine. Most systems shouldn’t get leaves on them as trees need to be far enough from your roof to not cast any shadows. We added a squirel guard after installation to protect the wiring from nest builders so you may want to have that done during install.

les

I recently purchased Solar panels for my house i live in NJ and since 1980 there has been a law that exempts these purchases from Sales Tax, but they charged me Sales tax anyway, saying a need some tax exempt status,what forms if any do i need to get a refund from the dealer?

Tom

I am looking into installing Solar Power System on my home. can anyone point me in the right direction for a grant or low financing?

garrett

i am looking to start a career in the solar industry i have no experience and would like to join a company to train me in the industry.how do i find the right one?

dave

“The return on a typical residential system takes about 15-20 years depending on the size and configuration of the system. The system itself has a life or 20-25 years. Do you see the problem here?”

These numbers just aren’t right. My 9.12 KW system is going to pay itself off in 4-5 years max (federal tax credit, NJ rebate, reduced/eliminated electric bill, SREC sales). The NJ rebate has shrunk since I received mine but I think the payback period in years is still single digits. Heck, I’ll rake in 6 grand a year in SREC sales alone (conservative estimate).

There’s no reason to think the system will last only 20-25 years. In fact, the manufacturers and installers warranties are usually for that time period which tells me that they they think the system life is longer. It’s really a simple system with no moving parts. Many panels from the seventies are still operating at 80% capacity or better.

dave

Tom, check out my blog. It’s got lots of information on some contractors and what rebates and grants are available.

Also check out the New Jersey Clean Energy Program website:

http://www.njcleanenergy.com

You’ll have to find a way to put down a chunk of money but you can minimize it by taking the federal tax credit (now completely uncapped), the NJ rebate which goes directly from the state to the contractor (not from your pocket).

After you’re producing energy you can sell your SRECs. You’ll earn one SREC for every 1,000 KWH you generate (for me that will be about every four weeks). Right now SRECs are selling for about 600 bucks.

Of course, you’ll also get to watch your meter spin backwards and get credited for all the energy you put out onto the grid if you don’t need it.

Peter

I am not sure if this is still the case – does anyone know if do-it-yourself installation can get NJ rebate?
Installing panels on the roof is very simple and all would need do is hire an electician to make nessesary connections to the grid (less then $1000). It looks to me that about 30% of the installation cost is going into someones pocket. If I could get NJ rabate myself that would lower my cost and it would only take 3 years to recuperate costs.

Violet Snow

The link from this article to NJ rebate info is broken:
http://www.njcleanenergy.com/renewable-energy/programs/core-rebate-program/incentives/core-rebate-program

Bill Bugge

I have trouble understanding the sale of SRECs.

One is generated for every 1000KW of solar electricity your system produces, correct?

It seems you can sell them for an amount based on the current market (ranging between $100 and $700 over the past few years). I currently am charged about 15 cents per KW by my electric company. That’s $150 per SREC. How can they sell for $650? The law of supply and demand?

So you not only don’t pay for electricity, you are paid to produce it, sometimes exorbitantly? Doesn’t make economic sense.

Something else doesn’t make sense. If you are paid to produce electricity, isn’t that an incentive to waste it? If you keep all your appliances on 24 hours, all lights etc, you earn more!

Correct me where I’m wrong, please.

Bill

Tor a.k.a. "Solar Fred"

Bill, did you read this post and the comments below?

http://www.solarpowerrocks.com/affordable-solar/solar-fred-info-recs-green-tags-oh-my/

There’s an explanation of the price in the comments.

As to being paid to waste energy, I think you’re misunderstanding the concept of an SREC. It’s not that you’re paid for the energy you USE, but the energy your solar panels PRODUCE. Your panels produce energy, whether you use it or not. Any excess is sent to the grid, and you get credited through net metering at night.

So, by buying your SRECS-which you don’t have to sell, by the way– the utility is complying with the law. It’s saying to the NJ legislator, “Hey, see Bill’s solar panels? I just bought his SRECs. You’ve made me buy 20% of my power from green sources, and, well, shoot, we don’t own many green sources right now. But Bill, he’s got 4kW of green solar energy. So if I buy his “SRECs” then you’ll credit me for producing green energy, not coal fired, and you won’t penalize me for not complying with the law to produce so much green energy by a certain time.”

So an SREC is like a gold star for utilities. They need to pay for them on the open market unless they own their own by building solar or wind farms. The price for an SREC is going to go up or down, depending on how many are for sale, but it’s more complicated on that. Read that post above.

Hope that helps!

[...] out the more detailed explanation of New Jersey’s solar rebates and incentives. Or, if you just want to see what it will cost you and your family, just fill out our form, and [...]

Kevin

I have a large southern facing field on a 3 acre residential lot in clinton twp. i was thinking of trying to put a large solar system in that exceeds my residential needs but i was told that Nj may limit what I can sell back to the grid. Any resources that i can check out to verify? Thanks

Tor a.k.a. "Solar Fred"

Hey, Kevin,

Not sure of the fine print, but check out this NJ program website for the “guidebook download.”

http://www.njcleanenergy.com/renewable-energy/programs/renewable-energy-incentive-program

I do know that the size of a residential system is limited to 10kW, so can’t go more than that. Net metering rules apparently allow you to go above your annual usage and be compensated for that at the “wholesale’ rate, but I’m not sure if there’s a cap on how much you can exceed.

There’s some contact info on this site as well to ask more specific questions:

http://www.dsireusa.org/solar/incentives/incentive.cfm?Incentive_Code=NJ03R&re=1&ee=1

Hope that helps.

[...] general, Solar friendly states like California, New Jersey, Massachusetts and others mentioned above can see a payback within 7 to 12 years, depending on the [...]

Artstacks

Is there any increased risk of fire when installing a solar or other green energy system?

Dan Hahn

Artstacks,

I can only speak to solar installations on this. Solar panels will keep your roof slightly more dry, so if you’re depending on a nice wet roof all the time to retard fires in your attic, you’re out of luck. That scenario being very unlikely, no, there is not any increased fire risk since all the conduit is protected and you won’t be seeing any sparks fly out of it. Would be more eye catching if it did spark up though, no?

dave conifer

My system (9.12 kw) is going to pay itself off in no more than four years, and that is without figuring in any rate increases for electrical power.

I can’t see how the solar panels would increase (or decrease) the risk of fire. The panels, even at peak sunlight, are no hotter than the shingles already on a roof. It’s not like they generate an open flame or anything.

It is a serious structural commitment to install the panels, which are bolted through the shingles and plywood right into the support structure of the roof. I’m not worried about it since I re-shingled before the panels went on but someday, somebody might need to do a new roof. It’ll be their problem (to have the panels removed and then reinstalled).

[...] is really in the top 2 of solar states, as far as incentives and net metering is concerned. (New Jersey could be #1. Yes, New Jersey.) The reason is that Colorado is not only offering some of the richest [...]

James J Kovalcin

Here is a question I have not seen addressed anywhere on the web!
What are the tax consequences of the “profits” generated from a solar installation in New Jersey?
Are the SREC’s taxable at either the federal or state levels?
If so, can the solar photo voltaic system be depreciated over the lifetime of the installation?
Is the New Jersey state rebate taxable on the federal level?

Tor a.k.a. "Solar Fred"

James, excellent questions for a tax geek. We are solar geeks here, so please don’t take our advice without double checking with your specialist.

First, the answer to many of your questions will depend on whether you are a business or a residence. If you are a resident, our understanding is that your state rebate is not taxable as income from the Feds or the state.

The income from RECs, on the other hand, I have no guidance on that. I suspect that it would be income because you have the option to sell them or not to sell them.

I’m not sure about the depreciation factor in New Jersey. However, I can tell you that solar systems in NJ are exempt from sales tax and any property tax increase.

Hope that helps. Please double check with your tax expert.

Brian

All this requires is low cost financing, if an individual has to tap his own resources not everyone has the credit to add 15k to 20k on top of their current credit needs. Guarantee financing at 5% for 10 years and the energy savings makes this an easy choice. Make people figure out their own financing options and it limits the number of people this will be viable.

Tor a.k.a. "Solar Fred"

Hey, Brian. I agree, but many companies do offer some kind of financing. In some states like Hawaii, the state also offers 0% financing for solar hot water. Then there’s the new trend in PACE financing, where you finance solar through a special tax assessment on your property.

Since every area and utility are different, I urge you to take the time to get a quote and your installer will tell you about the different types of financing available in your area.

Thanks for commenting.

glen

i am considering getting solar panels on my roof. The only thing stopping me is that i don’t know anyone who has it. the installation company has told me i can get approx 1 srec credit per month, about a $600.00 value currently. I just would love to hear from someone who has this installed and the results they are getting as far as srec payments.