Cost of Solar Panels in New Jersey: What to Expect in 2022

The cost of solar panels in NJ will indeed influence whether residents and businesses across the state embrace the possibilities offered by solar energy and the installation of solar photovoltaic (PV) panels. So, what’s the average solar panel cost in New Jersey?

The Northeast is home to some of the most significant growth in the solar industry in recent years, and New Jersey is no exception. Keep reading to learn how solar panel costs in New Jersey compare with the U.S. average, or to see how much solar panels would cost for your home right away, you can use this tool or fill out the form to get a free quote below.

How Much Do Solar Panels Cost in New Jersey?

As with much of the cost of living in New Jersey, the cost of solar panels in the state is also above the U.S. average, but only slightly so. Based on EcoWatch’s market research and data from top solar brands, the cost of solar panels in NJ is about $2.77 per watt. This is about 4% higher than the national average cost of $2.66 per watt.

To put that cost in practical terms for a solar project on an average-sized home, a 5-kilowatt (kW) solar system can be expected to cost about $10,249 (after the federal solar tax credit is applied). Here are estimates for other common solar system sizes:

Size of Solar Panel System

New Jersey Solar Panel Cost

Cost After Federal Tax Credit

5kW

$13,850

$10,249

6kW

$16,620

$12,299

7kW

$19,390

$14,349

8kW

$22,160

$16,398

9kW

$24,930

$18,448

10kW

$27,700

$20,498

Note that the prices above are simply estimated averages based on market data. The actual all-in cost for any individual solar project can and will vary due to factors including those discussed below. For a personalized estimate for a solar system tailored to your needs, you should consult directly with an installer that can spec out your buildings and specific requirements.

What Determines the Cost of Solar Panels in New Jersey?

As mentioned, the cost of solar panels in New Jersey, as well as anywhere else, will fluctuate based on numerous factors. Each project is unique, and installation costs must be evaluated on a case-by-case basis to determine if a solar investment is worthwhile for your home.

The best approach to determine project costs is to book a home consultation with an expert in your area, but in general, you can expect your choices of solar equipment, financing method and installation company to affect the cost of solar panels for your NJ home.

Solar Equipment

The cost of solar equipment is not fixed across the industry, and the specific items and brands chosen will have a notable impact on all-in solar panel installation costs. Solar equipment includes not just the solar panels themselves, but also auxiliary equipment like solar racking to attach them to the roof, digital and software tools to control the panels, and any advanced mechanisms like the ability to pivot to track the sun or extra-resilient outer glass to protect against the elements.

As expected, selecting high-end equipment, like the most efficient solar panels and the best solar batteries on the market, will drive up costs. On the other hand, selecting the most basic equipment will keep the budget lower. Anyone installing a solar energy system will need to weigh the pros and cons of choosing better equipment versus affordability.

Solar Financing

The upfront costs required to install solar panels can be a major deterrent to investing in solar energy in the first place. As noted in the table above, a solar project from 5 to 10 kW can cost you $10,000 to $20,000 on average in New Jersey. However, numerous solar financing opportunities exist to help homes and businesses manage these expenses.

Based on the financing option chosen, homeowners can pay lower upfront costs, but the overall lifetime cost can increase accordingly:

Cash: When paying for your solar panel system in cash, the all-in price tag is all you’ll pay. If you have the cash to pay upfront, this is the cheapest overall option, as interest and fees won’t add to your overall system cost.Solar loan: For those who cannot or do not want to pay for a solar system in cash, solar loans are often an option. A bank or other lender will pay part or all of the upfront costs to get your system installed, and you’ll pay that back over time, plus interest. Interest will lower your overall return on investment, but a loan is the best choice next to a cash payment.Solar lease or power purchase agreement: With a solar lease or power purchase agreement, you don’t have to pay anything for a solar system to be installed, but you don’t actually own the panels. Rather, the solar company retains ownership and allows you to pay them a fee each month to use them and the power they produce. While this option saves you the most upfront, you’ll miss out on benefits of ownership like being able to claim the federal tax credit and increased property value.

Installation Company

Lastly, the solar installer you choose will directly impact your system costs. The best solar companies in New Jersey will offer high-quality equipment at competitive rates, but to determine the right installer for your job, you’ll want to shop around and get multiple free quotes.

Installer options will vary based on where you are and your specific solar needs. Larger solar companies may get deals on equipment purchased in bulk, but local installers often offer discounts to compete with market leaders. For these reasons, we recommend reaching out to a mix of local and national providers, which you can do using this tool or the form below.

New Jersey Solar Incentives

Installing solar and promoting clean energy generation is a benefit to any community, which is why local governments offer direct incentives and rebates to help lower the cost of solar panels in New Jersey.

See a breakdown of New Jersey solar incentives below.

New Jersey Solar Incentives

Description

New Jersey Net Metering Programs

Through net metering, you can receive credits for any surplus solar energy you produce and export to the grid. These credits can be used to pay power bills. Not every state has a net metering mandate, but New Jersey does.

Transition Renewable Energy Certificates

You earn one TREC for every 1,000 kWh generated by your solar panels, and these can be sold to companies that are legally obligated to meet renewable energy goals. Residential TRECs sell for $91.20 per credit (as of December 2021).

New Jersey Solar Tax Exemptions

Solar panels are exempt from the 7% sales tax in New Jersey, and your home value increase after installing solar is exempt from property taxes.

Local Incentives

Additional incentives and low-interest financing programs may be available depending on where you live in New Jersey.

Federal Solar Tax Credit

The federal solar investment tax credit (ITC) allows homeowners to claim 26% of the cost of a solar power system turned on before the end of 2022.

FAQ: Cost of Solar Panels in New Jersey

Is it worth going solar in New Jersey?

Yes, it is generally worth going solar in New Jersey. Even though the price of solar panels in New Jersey is slightly higher than the national average, local incentive programs ensure maximum energy savings and associated cost savings on electric bills, which means installations typically will pay for themselves in just a handful of years and offer profit from that point forward.

What is the average cost of solar panels in New Jersey?

The cost of solar panels in New Jersey will vary based on a number of factors, including the specific equipment chosen, the installation company used, the size of the system, the financing method used, and how many incentives are utilized. That said, an average-sized solar system of 5 kilowatts will typically cost $10,249, while a larger system of 10 kilowatts would cost about $20,498 (after the federal tax credit is applied).

Are solar panels free in New Jersey?

No, solar panels are not free in New Jersey. That said, solar panels will end up paying for themselves in energy bill savings. Further, the state of New Jersey offers incentives to make solar installations cost less upfront and be more profitable in the long run.

How much do solar panels cost for a 1,500-square-foot house?

On average, a 1,500-square-foot home will require about a 6-kilowatt solar system to meet its energy demands. According to our research, a 6-kilowatt installation in New Jersey will cost about $12,299 after the federal tax credit.

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