The New Jersey Solar Initiative: A Beacon Of Hope For Clean Energy
Solar energy is one of the leading clean energy initiatives nationally and internationally. On a global scale, renewable energy from sources like solar is a top sustainable development goal (SDG) by UN states. In our country, several states have taken impressive steps to subsidize the cost of solar energy to help homeowners and businesses implement it easily; New Jersey is one of these impressive states. To access a solar system provider in New Jersey, navigate here. The state has implemented the New Jersey Solar Initiative, which has numerous incentives, rebates, and relief to slash the total solar system cost significantly.
Important Figures for Solar in New Jersey
New Jersey (NJ) ranks among the top ten states to have implemented solar in the country. As of 2021, it was seventh nationwide. In the last five years, the state’s residents have enjoyed a reduction of approximately 45% in the price of solar panels. The government expects the numbers to keep falling due to market forces, that is, an increase in supply over demand, resulting in price drops. The state projects that 50 % of NJ will be run by clean, renewable energy by 2030. They expect solar to be one of the main energy sources for this evolutionary move.
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Inflation Reduction Act (IRA)
One of the fundamental incentives that are part of the New Jersey Solar Initiative (NJSI) is the national Inflation Reduction Act. Through this law, NJ residents can enjoy up to a 30% reduction in the cost of a solar panel system. The initiative benefits non-taxable entities that participate in clean energy tax credits. They can enjoy a direct payment option which is scheduled from December 31, 2022 and ends on January 1st, 2033. The law aims to reduce the energy price for all Americans, especially low-income families while reducing the deficit. The federal initiative is one of the most aggressive actions to counter the climate crisis threatening the ecosystem and human health.
Solar Renewable Energy Credits (SREC)
The solar renewable energy credits are another revolutionary move contributing to reduced solar energy prices in NJ. This initiative by the state of New Jersey allows solar owners to earn money from their systems and save on electricity bills simultaneously. Every new solar project is provided with a Transition Renewable Energy Certificate (TREC) that will help them earn approximately $800 annually. The credit also allows residents to save up to 30% against the cost of the system. Residents are compensated per Kilowatt produced every hour (kWh) by their system. The amount received is not fixed at $800 and may vary based on the market value and other market forces.
Solar Investment Property Exemption
Another relief your solar provider can help you benefit from in NJ is the solar investment property exemption. The exemption allows homeowners and businesses to enjoy tax benefits by excluding the total cost of their solar system to their commercial or residential property. Their home will increase in value, but the new solar system will not make them pay more. When your property is valued, the cost of the solar system will be exempted from taxation. NJ is one of the 36 states that offer this relief, and in some localities, residents may enjoy more relief through local property tax abatements. Your solar provider is best suited to notify you how you can enjoy one or more tax reliefs.
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Solar Panel System Sales Tax Exemption
Finally, watch out for the solar panel system sales tax exemption you’re meant to enjoy while purchasing your solar system in NJ. All solar equipment, including batteries and panels, is eligible for reduced costs. The exemption may range from 2.9% to 9.5% for most cases. However, NJ offers a 100% tax exemption which reduces the cost of all your solar systems by 7%. As a result, you may see a notable difference when browsing for solar systems in NJ compared to other areas. The exemption is available for any taxpayer in the state.
When considering going solar in NJ, you can enjoy many tax incentives and reliefs. You can benefit from federal initiatives like the IRS and other reliefs provided by the state. One notable advantage is that there is a full tax exemption for all solar equipment which means you are more likely to pay less for solar in NJ than in many other states. Talk to your solar provider about each of the incentives mentioned above to ensure you don’t miss out on any possible cuts to your total cost.