NJ Solar Incentives Guide 2026: Tax Credits, SRECs & Rebates

New Jersey ranks consistently in the top 10 U.S. states for solar incentives — and 2026 is no exception. Between the federal tax credit, the SREC-II program, and state-level exemptions, a typical NJ homeowner can offset 40–60% of their total solar installation cost. Here's the complete breakdown.

1. Federal Solar Tax Credit (ITC) — 30%

The Investment Tax Credit (ITC) lets you deduct 30% of the total cost of your solar system from your federal income taxes. On a typical $25,000 NJ install, that's a $7,500 reduction in what you owe Uncle Sam. The credit is available through 2032 at the full 30% rate.

Who qualifies: Any homeowner who owns the solar system (cash purchase or loan). Leased systems don't qualify — the leasing company keeps the credit.

2. SREC-II Program (Successor Solar Incentive)

New Jersey's SREC-II program pays you for the clean energy your panels produce. For every 1,000 kWh your system generates, you earn one SREC-II. As of 2026, NJ SREC-IIs sell for around $85–$90 each.

A typical 8 kW residential system in NJ produces about 10 SREC-IIs per year — that's roughly $850–$900 in annual income for the first 15 years. Over the program lifetime, that's $12,000–$14,000.

3. Sales Tax Exemption — 6.625% saved

NJ exempts solar equipment from state sales tax. On a $25,000 system, that's another $1,656 in immediate savings.

4. Property Tax Exemption

Adding solar typically increases your home's value by 4–6%. Without this exemption, that would mean a higher property tax bill. New Jersey law exempts the added solar value from your property tax assessment — your taxes don't go up because you went solar.

5. Net Metering

Excess electricity your panels produce flows back into the grid, and your utility (PSE&G, JCP&L, ACE, or Rockland Electric) credits your account at the retail rate. Bills frequently drop to just the connection fee — $10–$20/month instead of $200+.

How it stacks up — real example

For a $25,000 (8 kW) install in Toms River, NJ:

• Federal Tax Credit (30%): −$7,500
• Sales Tax Exemption: −$1,656
• SREC-II income (15 yrs): −$13,000
• Net metering bill savings (25 yrs): −$45,000+

Net out-of-pocket cost: ~$15,800. Lifetime savings: $50,000+.

How Azimuth helps

Every Azimuth install in New Jersey is designed to maximize all five incentive streams. We handle the SREC-II registration, file your interconnection application, and walk you through the federal tax credit paperwork at year-end.