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New Jersey is in the top 10 states for rooftop solar in the country, thanks to great incentives at the state level…and rising electricity costs.
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Deciding to get solar panels is a hyper-local decision. While we have great incentives in place in New Jersey, your particular circumstances will impact whether solar panels are a good investment:
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It made sense for us: The backside of our roof and our detached garage both get a lot of sun, so we covered those with panels. We had replaced our roof just two years before, so it was in great shape. We assumed we would be in our house for at least 8 more years when we made the decision.
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The average rooftop system in Montclair is between $20,000 - $30,000.
Costs depend on the system size, which depends on your usage. The goal is to have your system sized to replace 100% of the electricity you pay for over a year. Your system cost may be more than average if your usage is more than average. Do you have a pool? Those pool heaters use a lot of energy. Do you charge an EV at home? They may push you out of the average range.
There are multiple stacking incentives available to encourage more homes to add rooftop solar.
| Incentive | What is it? |
|---|---|
| Net Metering | Net Metering is a policy that means on a really sunny day, when your panels are generating more energy than you’re using, you can send that energy back to PSEG to “bank” for you to use when it’s nighttime or cloudy. This is what allows you to potentially drop your electricity supply charges to $0. |
| *Note this is a highly local policy- it changes from state to state and with different utilities. | |
| Federal Tax Credit | EXPIRING DEC 31, 2025 |
| You can get a credit on your tax bill equal to 30% of your system cost. For a $30,000 system, that would be almost $10,000! But hurry- your system needs to be INSTALLED by Dec 31, 2025. [link] | |
| SuSI (SRECS) | In short, the state wants to grow the amount of renewable energy on the grid. By installing solar, you’re helping them do that. So for each 1000 kWh you produce, the state will give you a credit worth $850, a program in place for the next 15 years. So if I generate 10,000 kwh each year (the average amount), that’s another $850, per year- for 15 years. |
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We were able to take advantage of the tax credit and the SuSI incentives as well. There’s a monthly report you need to send to get the SuSI benefits, which your installer can help you with. Or I can, if you need. With a system sized to replace all our usage with Net Metering, we saved over $1000 in our first year.
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You can pay for the panels outright, or you can finance them. Most installers work with a separate financing company to make things easy. The financing company will have their own contract and can be shady, so don’t sign anything you don’t understand.
You can also lease. Generally, if you will be in your home for a decade or more and can swing the payments, buying has been shown to be a better deal. If you lease, just like a car, you don’t own the panels. So if you go to sell, the new buyer needs to take on the lease. For more on paying for the panels, you can read what Solar United Neighbors put together here.
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