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Add State and Local Incentives to the 30% Federal Tax Credit
Learn about solar incentives and solar rebates. Find out what is available to you through federal, state and local programs, as well as local utilities.
State and Local Solar Panel Rebates
Combining the Federal tax credit with state incentives you qualify for may significantly reduce the cost of your solar PV system.

Read more good news about these programs and important tips on qualifying below.
Federal Solar Tax Credit
30% of the cost of your Solar Electric System and installation can be deducted from your federal tax bill.

Read more about this credit and what qualifies.





Solar Incentives by State… Click on your state to see what is available.    
Solar States


— You may be able to afford a larger solar PV system than you originally thought!
— You may be able to add the battery backup system you were planning to buy in a year or two



The Good News About Solar System Incentives, Qualifications and Tips
Some solar incentive programs pay you back over time, based on the energy you generate. Other solar incentives are one-time payments of rebates or credits. Incentive requirements and definitions may vary between states.

Incentive types can be specifically for residential, schools, business, or industrial; or inclusive of all of them. Solar incentives are mainly for grid tied systems and are sometimes available for off grid systems.

The incentives may be only for solar photovoltaic (electric), for electricity generated by wind, or for solar thermal (hot water generation). Other types of incentives may incorporate multiple solar technologies.

Programs with yearly or periodic application dates have credits or rebate rates that may be stepped down over time.

To qualify for incentives, your solar system may have to be installed by a licensed Photovoltaic System Installer, and/or connected to the grid by a licensed Electrician. This may be particularly true for Grid-Tie (Grid-Intertied) systems.
Plan ahead and act quickly. Many incentive programs are time sensitive. First-come-first-served programs, such as lotteries, can be spoken for in minutes after the opening of their application date.

Be careful including incentives in your PV system's budget due to requirements and possible deadlines to meet before qualifying.

Always consult a tax professional in regards to your eligibility for tax incentives.





Solar Incentive Glossary
Battery Backup Systems
Battery backup systems can store electricity from the grid or a fuel-powered generator to provide emergency power when the grid goes down. It can also store energy created PV system to power appliances and lights at night after the sun goes down.

Feed in Tariffs,
a Performance Based Incentive, or PBI

(Available for Grid Tied Systems.)
Feed-in Tariffs are typically long term contracts with your local utility for performance-based compensation.

The contracts are typically a 15-25 year purchase agreement at a guaranteed rate. The rate may decrease over time as specified in the agreement. Feed-in Tariffs may ultimately pay for your PV system or even exceed your initial investment depending on the specifics in the contract.

Originally started in Germany in 1990 and restructured in 2000 to include the right to interconnect to the utility grid. It was designed as an incentive to promote cost-effective renewable energy use and advancements in technologies. Due to its success, the current German policy is the cornerstone for the creation of many feed-in tariff programs around the globe.

Green Building Programs
(May be available for Off-grid and/or Grid-tied Systems.)
Green Building Programs are generally for new construction and remodeling, or just adding a solar electric system. The most common incentives are reductions or waivers of building permit fees. Some state or local organizations offer coupons that reduce construction and/or installation costs to homeowners. The home or business owner usually gives the coupon to their program-authorized installer/contractor. Once the system is installed the installer/contractor can be reimbursed for the amount of the coupon by the program's organization.

Grid-Tied PV Systems
Grid tied systems are inter-connected to send energy back to the grid when your solar electric system creates more than you're using; and you can receive energy from the grid when you're using more electricity than your system is generating at the moment. Learn more about grid-tied solar systems.

Loans
(May be available for Off-grid and/or Grid-tied Systems.)
State or local governments may offer low or zero interest loans for renewable energy projects. Terms are typically 10 years or less. If you are going to purchase or remodel a home that you are going to add a solar system to you may also want to see the Energy Star website for information on Energy Improvement Mortgages (EIMs).

Property-Assessed Clean Energy (PACE) financing may be offered by states that have been authorized to participate in this program. The amount of the loan is determined by a special assessment of your property and is typically repaid over a period of years.

Check with your local banks and credit unions as they may offer renewable energy loans for less than the prime rate. Also consider that mortgage loans and home equity loans can offer several advantages: longer terms, lower interest rates than conventional bank loans, and tax-deductible interest.
Net Metering
(Available for Grid Tied Systems.)
As of January 2012, only four states do not have net metering policies ‐ South Dakota, Mississippi, Alabama and Tennessee. These programs are for utility customers who generate their own electricity and feed excess energy back into the grid. Net-metered customers may use grid energy when their electrical demand exceeds their solar electric system's output. Solar electric credit rates are applied to the customer's total electric use and are shown on the utility bills.

The credit rates and rules vary from state to state. Unused solar electric system credits may expire in a specified time period or they may be carried over from year to year. The credits may only be applied to the utility bill or you may be allowed to get a refund check at the end of a designated period, usually the end of the year.

Off-Grid PV Systems
Off grid systems do not feed energy back to the grid. You may be completely independent from the grid or you may be receiving grid electricity to supplement your system (Grid-Assisted). Learn more about off-grid solar systems.

Solar PV System (Photovoltaics)
A solar PV system uses photovoltaic panels (or modules) to create electricity. This powers appliances, lights, and other electric equipment.

Solar Thermal System
A solar thermal system uses panels (or modules) to heat water. The hot water is typically used instead of a water heater for everyday water use, or in a radiant heating system to warm the air.

State and Local Tax Incentives
(May be available for Off-grid and/or Grid-tied Systems.)
  • Personal tax incentives include income tax credits (dollar-for-dollar reduction on what you owe) and income tax deductions (reduces your taxable income).
  • Property tax exemptions, exclusions and credit incentives generally exclude the added value of the system from your yearly property tax. Abatements may reduce a percentage of your yearly property tax over time.
  • State sales tax incentives can be an exemption from or a credit towards the applicable sales tax.
Utility Rate Discounts & Rebates
(Available for Grid Tied Systems.)
Some utilities and state or local programs may offer temporarily reduced rates on utility bills, or one time rebates on the installation of solar systems and purchases of energy efficient appliances and/or HVAC systems.


Updated: 09/24/2016
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New Jersey Solar Incentives
Updated: 09/24/2016
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INCENTIVE NAME: Solar Easements
CATEGORY: Regulatory Policy
TYPE: Solar/Wind Access Policy
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ01R
LAST UPDATE: 10/12/2014

INCENTIVE NAME: Net Metering
CATEGORY: Regulatory Policy
TYPE: Net Metering
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ03R
DETAILS:
Applicable Utilities - Investor-owned utilities (electric distribution companies), electric suppliers
System Capacity Limit - System must be sized so that energy production does not exceed customer's annual on-site energy consumption
Aggregate Capacity Limit - No limit specified (BPU may limit to 2.5% of peak demand)
Net Excess Generation - Generally credited to customer's next bill at retail rate; excess reconciled annually at avoided-cost rate
Ownership of Renewable Energy Credits - Customer owns RECs
Meter Aggregation - Only for public entities (state and local governments, local agencies, and school districts)
WEBSITE: http://www.njcleanenergy.com/renewable-energy/programs/net-metering-and-interconnection
UTILITIES: Atlantic City Electric Co, Jersey Central Power & Lt Co, Public Service Elec & Gas Co, Rockland Electric Co,
LAST UPDATE: 06/26/2015

INCENTIVE NAME: Societal Benefits Charge
CATEGORY: Regulatory Policy
TYPE: Public Benefits Fund
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ04R
DETAILS:
Types - Energy efficiency, renewables, low-income energy assistance
Total Fund - $344 million (FY2014)$2.635 billion (2001-June 2013); refers to scheduled collections prior to transfers out of the fund for other purposes
Charge - Per-kWh surcharge (varies annually by funding target)
WEBSITE: http://www.njcleanenergy.com/main/public-reports-and-library/program-budgets-and-filing/program-budgets-and-filing-0
UTILITIES: Atlantic City Electric Co, Jersey Central Power & Lt Co, Public Service Elec & Gas Co, Rockland Electric Co,
LAST UPDATE: 10/13/2014

INCENTIVE NAME: Solar Energy Sales Tax Exemption
CATEGORY: Financial Incentive
TYPE: Sales Tax Incentive
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ01F
DETAILS:
Incentive Amount - 100% exemption
Maximum Incentive - None
LAST UPDATE: 10/01/2014

INCENTIVE NAME: Renewables Portfolio Standard
CATEGORY: Regulatory Policy
TYPE: Renewables Portfolio Standard
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ05R
DETAILS:
Standard - 20.38% Class I and Class II renewables by energy year 2020-2021 + 4.1% solar-electric by energy year 2027-2028
Technology Minimum - Solar-Electric: 4.1% by energy year 2027-2028
Offshore Wind: 1,100 MW (standard must be defined in % terms by BPU, sufficient to reach this level of generating capacity)
Credit Trading/Tracking System - Yes (PJM-GATS)
WEBSITE: http://www.njcleanenergy.com/renewable-energy/program-activity-and-background-information/rps-background-info
LAST UPDATE: 05/20/2015

INCENTIVE NAME: Interconnection Standards
CATEGORY: Regulatory Policy
TYPE: Interconnection
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ11R
DETAILS:
Applicable Utilities - Investor-owned utilities (electric distribution companies)
System Capacity Limit - System must be sized so that energy production does not exceed customer's annual on-site energy consumption
Standard Agreement - Varies by system size
Insurance Requirements - "Additional" liability insurance not required for systems that meet certain technical standards
External Disconnect Switch - Not required for systems that meet certain standards
Net Metering Required - No
WEBSITE: http://www.njcleanenergy.com/renewable-energy/programs/net-metering-and-interconnection/interconnection-forms
LAST UPDATE: 10/10/2014

INCENTIVE NAME: High Performance Schools Policy
CATEGORY: Regulatory Policy
TYPE: Energy Standards for Public Buildings
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ14R
WEBSITE: http://www.njsda.gov/GI/FAQ.html#GC
LAST UPDATE: 10/08/2014

INCENTIVE NAME: Residential Solar Rights
CATEGORY: Regulatory Policy
TYPE: Solar/Wind Access Policy
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ15R
LAST UPDATE: 10/12/2014

INCENTIVE NAME: PSE&G - Solar Loan Program
CATEGORY: Financial Incentive
TYPE: Other Incentive
SECTOR: Utility
TECHNOLOGY: Solar Photovoltaics,
SOURCE: Ratepayer surcharge (RGGI recovery charge, or RRC)
CODE: NJ21F
BUDGET: $100 million (Solar Loan III)
WEBSITE: http://www.pseg.com/home/save/solar/index.jsp
UTILITIES: Public Service Elec & Gas Co,
LAST UPDATE: 05/13/2015

INCENTIVE NAME: High Performance Building Standards in New State Construction
CATEGORY: Regulatory Policy
TYPE: Energy Standards for Public Buildings
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ16R
LAST UPDATE: 10/08/2014

INCENTIVE NAME: Property Tax Exemption for Renewable Energy Systems
CATEGORY: Financial Incentive
TYPE: Property Tax Incentive
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ25F
DETAILS:
Incentive Amount - 100% of value added by renewable system
LAST UPDATE: 10/01/2014

INCENTIVE NAME: Edison Innovation Clean Energy Manufacturing Fund - Grants and Loans
CATEGORY: Financial Incentive
TYPE: Industry Recruitment/Support
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
SOURCE: New Jersey Societal Benefits Charge (public benefits fund)
CODE: NJ26F
DETAILS:
Incentive Amount - Grants: up to $300,000
Loan: Up to $ 3 million

Terms - 50% of cost share required;
Loans at 2% interest for up to 10 years with three year deferral of principal repayment
BUDGET: $2 million
WEBSITE: http://www.njeda.com/clean_energy/edison_growth_fund
UTILITIES: Atlantic City Electric Co, Jersey Central Power & Lt Co, Public Service Elec & Gas Co, Rockland Electric Co,
LAST UPDATE: 01/20/2016

INCENTIVE NAME: Solar and Wind Permitting Laws
CATEGORY: Regulatory Policy
TYPE: Solar/Wind Permitting Standards
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ17R
LAST UPDATE: 10/27/2014

INCENTIVE NAME: Solar Energy Option Requirement for Residential Developments
CATEGORY: Regulatory Policy
TYPE: Building Energy Code
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ18R
DETAILS:
Residential Code - Developers of residential developments with 25 or more dwelling units must offer prospective purchasers the option to install a solar energy system on the dwelling during purchase negotiations
LAST UPDATE: 10/08/2014

INCENTIVE NAME: Assessment of Farmland Hosting Renewable Energy Systems
CATEGORY: Financial Incentive
TYPE: Property Tax Incentive
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ36F
DETAILS:
Incentive Amount - Varies
Eligible System Size - 2 MW or less; equipment may not cover more than 10 acres
WEBSITE: http://www.state.nj.us/agriculture/sadc/news/hottopics/
LAST UPDATE: 10/01/2014

INCENTIVE NAME: Edison Innovation Green Growth Fund Loans
CATEGORY: Financial Incentive
TYPE: Industry Recruitment/Support
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
SOURCE: New Jersey Societal Benefits Charge (public benefits fund)
CODE: NJ44F
DETAILS:
Incentive Amount - Varies; loans from $250,000 - $2 million available
Maximum Incentive - Maximum Loan: $2 million (1:1 cash match required from non-state grants, deeply subordinated debt or equity)
Performance Grant Conversion (end of loan term): up to 50% of loan amount
Terms - Fixed five-year term; interest rates of 2%.
50% loan conversion to a performance grant may occur at the end of the 5 year period.
WEBSITE: http://www.njeda.com/clean_energy/edison_growth_fund
LAST UPDATE: 01/20/2016

INCENTIVE NAME: Solar Renewable Energy Certificates (SRECs) Registration Program
CATEGORY: Financial Incentive
TYPE: Solar Renewable Energy Credit Program
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ54F
DETAILS:
Incentive Amount - Depends on the market.
Maximum Incentive - Maximum price set by the SACP for the particular year.
Duration - SRECs can be generated for the first 15 years of the system.
SREC has a trading life of 5 years.
WEBSITE: http://www.njcleanenergy.com/srec
LAST UPDATE: 06/26/2015

INCENTIVE NAME: SREC-Based Financing Program (ACE, JCP&L, RECO)
CATEGORY: Financial Incentive
TYPE: Solar Renewable Energy Credit Program
SECTOR: Utility
TECHNOLOGY: Solar Photovoltaics,
CODE: NJ57F
DETAILS:
Incentive Amount - Set through competitive bidding
Eligible System Size - Segment 1: less than or equal to 50 kW
Segment 2: 50 kW to 2 MW
Segment 3: Grid supply projects located on closed landfills, brownfields, or areas of historic fill.

Duration - Limited to a cap of 1,350 kWh of solar generation per kW DC or 10 year term, whichever occurs first
Installation Requirements - Must be netmetered
WEBSITE: http://www.njcleanenergy.com/renewable-energy/programs/utility-financing-programs/atlantic-city-electric-jersey-central-power-and-
UTILITIES: Atlantic City Electric Co, Jersey Central Power & Lt Co, Rockland Electric Co,
LAST UPDATE: 01/07/2016

INCENTIVE NAME: NJ Clean Energy- Residential New Construction Program
CATEGORY: Financial Incentive
TYPE: Rebate Program
SECTOR: State
TECHNOLOGY: Solar Photovoltaics,
SOURCE: New Jersey Societal Benefits Charger (Public Benefits Fund)
CODE: NJ60F
DETAILS:
Incentive Amount - Single family homes: Ranges from $125- $24,250 depending on the HERS score and Tier.
Multifamily homes: ranges from $1,250 - $2,250 per unit

Maximum Incentive - Multifamily: up to $2,250 per unit
Individual homes: up to $24,250

Equipment Requirements - Must meet ENERGY STAR specifications
Installation Requirements - Must be installed by participating ENERGY STAR Home Builder
Ownership of Renewable Energy Credits - Not specified
BUDGET: $15.67 million (FY2016), $19.9 million (FY 2015 )
WEBSITE: http://www.njcleanenergy.com/residential/programs/nj-energy-star-homes/nj-energy-star-homes
LAST UPDATE: 07/28/2015

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