New Jersey punches well above its size as a solar state. Despite modest sunlight compared to the Sun Belt, NJ combines high electricity rates, a unique performance-based incentive (the SuSI program) that pays you for every megawatt-hour your panels produce, full retail net metering, and 100% sales and property tax exemptions. That stack keeps payback periods short — typically 6–9 years — even after the federal ITC expired at the end of 2025.
Use our Solar Savings Calculator to get an instant estimate based on your New Jersey ZIP code and monthly electricity bill.
New Jersey Solar at a Glance (2026)
| Factor | New Jersey 2026 |
|---|---|
| Avg. electricity rate | ~$0.17/kWh (above national avg) |
| Avg. 7 kW system cost | ~$18,800 |
| Federal ITC | ❌ Expired Dec 31, 2025 |
| State income tax credit | ❌ None |
| SuSI / SREC-II | ✅ Fixed payment per MWh for 15 years |
| Net metering | ✅ Full retail credit |
| Sales tax exemption | ✅ 100% (6.625% saved) |
| Property tax exemption | ✅ 100% on added solar value |
| Avg. payback period | 6–9 years |
What Solar Incentives Are Available in New Jersey in 2026?
The federal 30% residential ITC (Section 25D) expired December 31, 2025 — see our full ITC status guide. New Jersey has no state income tax credit, but its production-based incentive and exemptions are among the strongest in the country:
1. SuSI — Successor Solar Incentive (SREC-II)
This is New Jersey’s signature solar incentive. The Successor Solar Incentive (SuSI) program issues you an SREC-II for every megawatt-hour (1,000 kWh) your system produces, at a fixed price for 15 years.
- Residential systems earn a fixed SREC-II value (historically around $85/MWh for the residential/net-metered segment — confirm the current rate with the NJ Board of Public Utilities)
- A typical 7 kW NJ system produces ~8.5–9 MWh/year → roughly $720–$765/year in SREC-II income
- Over the 15-year term, that’s ~$10,800–$11,500 in performance payments — on top of your bill savings
- Payments are fixed and predictable, unlike the old volatile SREC market
This production income is what makes New Jersey solar so financially strong despite average sunlight.
2. Full Retail Net Metering
New Jersey mandates net metering at the full retail rate for the major utilities (PSE&G, JCP&L, Atlantic City Electric, Rockland Electric). Excess solar is credited at your retail rate (~$0.17/kWh) and rolls over month to month.
3. 100% Sales Tax Exemption
Solar energy equipment is fully exempt from New Jersey’s 6.625% sales tax. On an $18,800 system, that’s roughly $1,245 saved automatically.
4. 100% Property Tax Exemption
Under New Jersey’s solar property tax exemption, the added home value from your system is 100% exempt from property taxes — valuable in a state with some of the highest property tax rates in the nation. You’ll need to obtain a certificate from your local assessor.
New Jersey Solar Savings Example (2026)
For a New Jersey homeowner with a $170/month electricity bill ($2,040/year):
| Amount | |
|---|---|
| 7 kW system gross cost | $18,800 |
| Sales tax exemption (6.625%) | −$1,245 |
| Estimated net cost | ~$17,555 |
| Annual electricity savings | ~$1,600–$1,900 |
| SuSI / SREC-II income (annual) | ~$720–$765/year for 15 years |
| Property tax exemption | 100% of added value, ongoing |
| Payback period | 6–9 years |
| 25-year net savings | ~$40,000–$55,000 |
Estimates based on a 7 kW system producing ~8,800 kWh/year at New Jersey’s ~4.4 peak sun hours, combining bill savings with SuSI production income. Actual results vary by utility and current SREC-II rate.
Get your free New Jersey solar estimate → Use our Solar Calculator
New Jersey Electricity Rates and Solar ROI
New Jersey’s average rate of ~$0.17/kWh sits above the national average, and the combination of bill savings plus 15 years of SuSI production income is what drives the short payback. NJ gets ~4.4 peak sun hours/day — less than Arizona or Florida — but the incentive structure more than compensates.
New Jersey areas and their solar potential:
| Area | Avg. Peak Sun Hours/Day | Notes |
|---|---|---|
| Atlantic City / South Jersey | 4.6 | Best sun in the state (ACE territory) |
| Trenton / Central Jersey | 4.4 | PSE&G territory, competitive market |
| Newark / North Jersey | 4.3 | High rates, dense installer market |
| Vineland | 4.6 | Municipal utility — check separate rules |
Use NREL’s PVWatts Calculator for a production estimate at your specific address.
How the SuSI Program Pays You
Many homeowners misunderstand SREC-II income, so here’s the plain-English version:
- Your system has a production meter that records how much energy it generates
- For every 1,000 kWh (1 MWh) produced, you earn one SREC-II at the fixed program rate
- You (or your installer/aggregator) sell those SREC-IIs into the program for cash
- This continues for 15 years, regardless of how you use the power
So you benefit twice: once by offsetting your electric bill (net metering), and again by getting paid for production (SuSI). That dual benefit is the heart of New Jersey’s solar value.
Solar + Battery Storage in New Jersey
- New Jersey has been developing energy storage incentives through the BPU — check current program status before purchasing
- Storage provides backup during Nor’easters and grid outages
- Federal ITC for batteries expired December 31, 2025 — no 30% federal credit in 2026
- Battery value in NJ is driven more by resilience than by rate arbitrage (since net metering is already full-retail)
Is Solar Worth It in New Jersey Without the Federal ITC?
For most New Jersey homeowners, yes — the SuSI program and full-retail net metering keep returns strong even without the federal credit. Solar is especially compelling for:
- Homeowners with $130+/month bills on PSE&G, JCP&L, or ACE
- Anyone who values the predictable 15-year SuSI income stream
- South Jersey with the best sun in the state
- High-property-tax households who benefit most from the exemption
Where New Jersey solar is harder to justify in 2026:
- Low bills (<$90/month)
- Heavily shaded or north-facing roofs
- Plans to move within a few years (though SuSI and net metering transfer with the system)
How to Get an Accurate New Jersey Solar Quote
Your actual savings depend on:
- The current SREC-II rate — confirm the fixed residential value with the NJ BPU
- Your utility — PSE&G, JCP&L, ACE, and Rockland differ on net metering details
- Your production — South Jersey produces more than North Jersey
- Who registers and sells your SREC-IIs — clarify this with your installer
Get quotes from 3+ installers and make sure each shows the SuSI income separately from bill savings. NJ prices vary 15–25%.
Start with a free estimate → Solar Calculator
Key Takeaways
- The SuSI program (SREC-II) pays you a fixed amount per MWh produced for 15 years — roughly $720–$765/year on a typical system
- Full retail net metering plus SuSI means you benefit twice: bill savings and production income
- 100% sales tax exemption (~$1,245) and 100% property tax exemption are automatic value
- Above-average electricity rates (~$0.17/kWh) strengthen the case
- Federal ITC expired December 31, 2025 — no 30% federal credit for 2026 installations
- Avg. payback: 6–9 years; 25-year savings: $40,000–$55,000
- Always confirm the current SREC-II rate with the NJ Board of Public Utilities before signing
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- Solar Savings Calculator
Sources: NJ Board of Public Utilities — SuSI Program, NJ Clean Energy Program, NJ Solar Sales & Property Tax Exemptions, NREL PVWatts, DSIRE New Jersey Incentives, EIA New Jersey Electricity Profile.