Utility and Tax Incentives

Federal, state, and local governments understand the importance of sustainable energy and the high costs associated with traditional power sources. Utility companies can’t afford to maintain their infrastructure costs as homes use more and more power. That’s why, in most cases, utility and tax incentives can save customers well over 50% on the cost of energy.*

*Ask your representative about which incentive you’re eligible to receive. Please consult a tax advisor on your ability to claim these nonrefundable tax credits.

Federal Investment Tax Credit – 30%

The solar investment tax credit (ITC) is a dollar-for-dollar reduction in the income taxes that a person or company claiming the credit would otherwise pay the federal government. The federal ITC is based on 30% of the homeowner’s cost to install solar from 2022-2032. On leased systems, SunPower® collects this incentive and passes the savings on to the homeowner. Don’t wait, prices for solar equipment are on the rise!

Federal Tax Credit Solar ITC Step Down Graphic
State Incentives

Net Metering – New Jersey is a leader in state net metering programs. Net metering allows the electric grid to store the electricity produced by your solar energy system to use at a later time and helps maximize the investment in your system. When your solar panels produce more electricity than your property uses during the day, the unused electricity is sent back to the grid. When your property uses more electricity than your solar panels produce, your property draws electricity from the grid. At the end of your billing cycle, your property is charged for the balance or “net” of what you put into the grid vs. what you took off the grid.

Renewable Energy Credits – The Board of Public Utilities (BPU) New Jersey’s Clean Energy Program lets property owners earn Renewable Energy Certificates, for every kilowatt-hour (kWh) of solar energy the system creates based on market value.

New York State Tax Credit – 25%
New York state offers homeowners a dollar-for-dollar reduction in the income taxes that a person claiming the credit would otherwise pay. The state tax credit is based on 25% of solar’s cost to the homeowner, limited to $5,000. If you can’t claim the credit in the first year, don’t worry, it will roll over for 5 years!

NYSERDA – Financing / $0.20 per kilowatt
Through the NY-Sun Program, the New York State Energy Research and Development Authority (NYSERDA) provides financing options and financial incentives for the installation of new grid-connected solar systems.

In New York & New Jersey City, a cash grant from NYSERDA of 20¢ per watt lowers the elevated cost to install solar. The installation of a 7kW solar system could earn a $1,400 deposit from the state! This incentive, once $1.00 per watt, will continue to decrease as more people install solar systems. Sea Bright Solar and SunPower collect this grant from NYSERDA directly, reducing your cost to install solar.

California Incentives 
Effective in 2022 California is not offering any state-specific solar tax credit, but it does offer property tax exemptions for new solar installations. People who install solar panels on their home early in the year will still qualify for California’s current Net Energy Metering (NEM) 2.0, but in May or June, all new residential systems will fall under NEM 3.0. The Public Utilities Commission has yet to vote on a final version of NEM 3, but it’s likely to include a reduction in compensation for excess solar energy and might also come with increased fees on solar owners.

Property Tax Exemption – 100% through 2024

Installing solar panels on your home increases its value up to 20 times your annual energy bill savings. We don’t think you should be penalized for your sustainable decision and many state legislators agree! Until the end of 2024, new solar installations will be subject to no additional property taxes based on their assessed value.

Increase Home Value

Having a solar energy system on your home is known as a capital improvement which adds to your property’s value. This means that you can potentially sell your home faster and for more than homes without solar. Your investment in efficient, clean solar power also adds to the tax basis of your home. If you sell the home, this tax basis investment can be deducted from the sales price, reducing the amount of the price that is counted as profit. This reduces the taxes taken from the sale and may be able to help you avoid capital gains taxes on appreciation.

Your investment in efficient, clean solar power also adds to the tax basis of your home.