New Jersey - Energy tax credit, solar rebates and incentives

New Jersey energy incentives fuel powerful growth

New Jersey's renewable energy incentives, including those for solar power, wind energy and energy efficiency, have made it one of the fastest growing states for clean energy.  A variety of energy tax credits, energy rebates, grants and state and local incentives are available:

Property tax exemption for renewable energy systems

Since 2008, New Jersey has waived the fee for local property tax on all renewable energy systems that are used on-site to heat, cool or create general electricity. Viable candidates for this tax exemption include solar PV, wind, geothermal electric, landfill gas, sustainable biomass, hydroelectric, resource recovery, wave, and tidal systems that produce electricity. Two other systems that qualify for this exemption include solar energy and geothermal energy producers.

New Jersey energy tax exemptions - How to take advantage

The best way to receive tax exemption is as follows:

• Apply for a certificate from your local assessor
• This will lead to a decreased valuation of your property by subtracting your renewable energy system from the equation.
• If your application is accepted, tax exemption will become effective beginning in the following year.

New Jersey solar energy sales tax exemption

All solar energy equipment (including passive solar design) is eligible for receiving a full sales tax exemption. The current sales tax rate is 7%. Solar energy tax exemptions are also available for energy efficient technologies including fuel cells, biomass energy, photovoltaic and small wind-energy systems. The rebates for these technologies range from $0.15- $4.00 per watt DC.

How to take advantage of the energy sales tax exemption:

• In order to qualify, energy systems must have at least a five-year warranty and are not allowed to have an energy output of over 100% of the expected consumption.
• All New Jersey taxpaying residents are eligible for this rebate.

New Jersey Net Metering

Geothermal, wind, wave, solar, tidal, sustainable biomass or landfill gas systems are eligible for net metering in New Jersey. The maximum capacity for an individual system is two megawatts. After each billing cycle the customer is given credit for the net excess generated at the utility retail rate. Customers may sell or purchase net excess generation through a bilateral partnership with their electrical or service provider. The customer owns all renewable-energy credit that is correlated to the generated electricity. Customers may take part in New Jersey’s Solar Renewable Energy Certificates program if they have a photovoltaic system and apply to the New Jersey Board of Public Utilities. 

Energy-efficient mortgages

Homeowners have the option to use an EEM (energy-efficient mortgage) in order to receive federal loans for financing home operated renewable technologies

Residential renewable energy tax credit

Taxpayers are able to file for a personal tax credit of 30% of expenditures including installation and labor costs for solar-electric systems, fuel cells, or solar water heating systems. Geothermal heat pumps and small wind-energy systems are also eligible.