For an average home with average usage, cash purchases for solar systems in New Jersey range from $35,000 to $50,000 before incentives, depending on conditions, and $18,000 to $30,000 after incentives. Financing options, although less popular due to rising interest rates, typically result in monthly payments ranging from $130 to $200 after incentives. For Power Purchase Agreements (PPA) or leases, average monthly costs range from $105 to $135, making it a simpler, low upfront cost option.
Understanding Solar Panel Costs in New Jersey: Accurate Pricing from Reputable Providers
When considering solar energy for your home, understanding the costs involved is crucial. In this article, we’ll provide average pricing quotes that homeowners can expect when working with local, reputable, and experienced solar companies in New Jersey.
A Disclaimer
It’s important to note that the figures presented here are based on Tier 1 equipment, which is often categorized as premium panels, micro-inverters, and American-made racking. These prices reflect high-quality workmanship with reliable installations.
Be cautious of other websites claiming to provide solar pricing in New Jersey that are not affiliated with actual solar providers. These sources often present inaccurate pricing that can lead to misconceptions about the true costs of solar energy. If you’re looking for information that just shows average price per watt (PPW) rates, this article may not meet your needs, as our focus is on realistic and trustworthy pricing that reflects the quality of service you should expect.
With that said, let’s dive into the details of solar panel pricing, financing options, and what you can anticipate as you explore the benefits of solar energy for your home.
Average Solar Panel Costs in New Jersey
The cost of solar panels can vary significantly based on several factors, including the size of the system, the type of panels used, and the installer’s fees. In this section, we’ll provide an overview of the typical costs associated with installing solar panels in New Jersey.
Cost Breakdown
- System Size: The average residential solar panel system size in New Jersey is around 7 kW.
- Cost per Watt: The cost per watt typically ranges from $3.50 to $5.00. Anything less than $3.50 should raise some red flags. Anything more than $5 should as well.
- Total Cost: A typical 7 kW system may cost between $24,500 and $35,000 before incentives.
The numbers in the chart below assumes the home gets an average amount of sunlight throughout the year.
| Pricing Option | Average Electric Bill | System Size (kW) | Panel Count | Purchase Price Before Incentives | Purchase Price After Incentives | Monthly Payment Before Incentives | Monthly Payment After Incentives | 25-Year Savings |
|---|---|---|---|---|---|---|---|---|
| Cash Purchase | $75 | 5 kw | 12-14 | $21,250 | $10,375 | $0 | $0 | $39,691 |
| $150 | 10 kw | 24-28 | $40,000 | $19,000 | $0 | $0 | $69,659 | |
| $300 | 18 kw | 44-48 | $69,300 | $32,310 | $0 | $0 | $153,408 | |
| Pricing Option | Average Electric Bill | System Size (kW) | Panel Count | Purchase Price Before Incentives | Purchase Price After Incentives | Monthly Payment Before Incentives | Monthly Payment After Incentives | 25-Year Savings |
| Financing | $75 | 5 kw | 12-14 | $0 | $0 | Approx. $150/month | Approx. $85/month | $28,435 |
| $150 | 10 kw | 24-28 | $0 | $0 | Approx. $330/month | Approx. $175/month | $54,590 | |
| $300 | 18 kw | 44-48 | $0 | $0 | Approx. $660/month | Approx. $360/month | $107,110 | |
| Pricing Option | Average Electric Bill | System Size (kW) | Panel Count | Purchase Price Before Incentives | Purchase Price After Incentives | Monthly Payment Before Incentives | Monthly Payment After Incentives | 25-Year Savings |
| Lease/PPA | $75 | 5 kw | 12-14 | $0 | $0 | Approx. $60/month | Approx. $60/month | $23,460 |
| $150 | 10 kw | 24-28 | $0 | $0 | Approx. $120/month | Approx. $120/month | $49,755 | |
| $300 | 18 kw | 44-48 | $0 | $0 | Approx. $240/month | Approx. $240/month | $103,780 |
Factors Influencing Solar Costs in New Jersey
1. Location
Location affects solar pricing similarly to how gas prices vary based on demand. Just as gas prices are higher in densely populated areas like New York City due to more cars on the road, solar installation costs can be higher in areas with greater demand on the electric grid. This increased demand leads to higher electricity prices, making solar installations more expensive in cities compared to rural areas.
2. Utility provider
Different utilities have different rates. Solar companies price their services based on that jurisdictions utility prices. This related directly to Location and demand. PSE&G electric rates are higher then JCP&L, which means for the same solar system size, the cost of a solar system for a customer that used PSE&G as their utility provider may be slightly more than someone who has JCP&L as their provider.
3. Sun exposure
More sun light means more efficient home for solar which means less panels needed. Less efficient means more panels needed. The more solar panels needed, the more expensive the system can get.
4. Roof layout and material
Special roof angles and limited space may require unique equipment, impacting pricing. Additionally, roof types like metal, slate, clay tile, and cedar shake can also affect costs. Having multiple roof planes for solar panels, instead of just one or two, will further influence the price.
5. Timing
State incentives for NJ are decreasing, so getting solar four months from now will be more expensive than getting it today.
6. Electric consumption
The more power your home uses, the bigger the solar system you may need. More solar panels equals larger total cost. Larger systems generally have a lower cost per watt but a higher overall cost.
7. Type of Panels
Tier 1 Panels: High efficiency and durability, typically more expensive. Tier 2 Panels: Moderate efficiency and cost, suitable for most homes.
8. Installation Fees
- Labor Costs: Vary by installer and complexity of the installation. With finance and lease/PPA options, the down payment would be $0.
- Permitting Fees: Local government fees for permits and inspections.
9. Additional Equipment
- Inverters: Convert DC electricity from panels to AC electricity for home use.
- Racking Systems: Secure the panels to your roof or ground.
10. The solar company
A company that prides themselves on customer service and installation workmanship with have a higher PPW price. A company quoting you an alarmingly low PPW means there will be a lack of post-installation support and cheaper equipment will be used while installation corners are being cut. Overwhelmingly common within the industry unfortunately. Best practice is to not shop solely on price.
New Jersey Solar Incentives and Rebates
Federal Solar Investment Tax Credit (ITC)
Solar incentives and rebates play a pivotal role in making solar energy more affordable by reducing the upfront costs of installation. The Federal Solar Investment Tax Credit (ITC) is one of the most significant incentives, allowing homeowners to deduct 30% of the cost of their solar system from their federal taxes for systems installed before the end of 2024. In addition to federal incentives, many states offer their own programs to further support solar adoption.
New Jersey’s Solar Renewable Energy Certificate (SREC) Program
In New Jersey, going solar comes with some great perks. The state has a Solar Renewable Energy Certificate (SREC) program, which pays you based on how much electricity your solar system produces. Each SREC represents a certain amount of solar energy, and you can sell these certificates to utility companies for extra cash.
Long-Term Rebates and Earnings
You can get rebates for up to 15 years, earning money for every unit of solar energy your system produces. The current program in NJ pays homeowners 8.5 cents for every kWh you produce.
Financial Impact of SRECs
An average system in NJ generates 8,000 kWh / year, which equates to $680/year totaling up to $10,200 in direct cash back rebates. This increases the return you’d receive on going solar in NJ, a state where the sun isn’t always shining.
Guaranteed Incentives
Once your system is approved by the state, your rebates are guaranteed or grandfathered in, ensuring that you won’t have to worry about incentives disappearing if the state discontinues the program.
Immediate Savings with Incentives
Taking advantage of these federal and state incentives means New Jersey residents can cut down on the initial cost of going solar and start saving on their energy bills right away.
Incentives and Leasing/PPA Options
Please bear in mind, the state incentives are not given to you directly with the lease or PPA option since you do not own the solar system. They are given to you indirectly in the form of a lower monthly payment.
Payment Terms
Cash Purchase
For a cash purchase, payment is typically structured in the following way:
- Initial Deposit: Depending on the installer, an initial deposit of $2,000 to $5,000 is due at the time of the site survey, which usually takes place about a week after signing the contract.
- Progress Payment: 80% of the total invoice amount is due at the time of installation of the equipment, which generally occurs 1 to 3 months after the site survey.
- Final Payment: The remaining balance is due upon system activation, which can be 1 to 3 months after installation, depending on the utility provider.
Financing and PPA/Lease
For financing options and Power Purchase Agreements (PPA) or leases, the payment terms are more straightforward:
- Initial Payment: $0 down is required at the time of signing.
- Start of Payments: Monthly payments typically begin 1 to 3 months after the installation, depending on the specific provider and terms of the agreement.
These terms ensure flexibility and affordability for homeowners, accommodating different financial situations and preferences.
Understanding Solar Savings and Pricing in New Jersey
Solar energy typically costs less than traditional energy over time. The timeframe to see these savings can vary depending on the solar option you choose. In New Jersey, electric rates are rising due to ambitious environmental goals requiring utility companies to invest billions, which in turn increases customer costs. By switching to solar energy, you can avoid these escalating costs.
Solar Savings Breakdown:
- Power Purchase Agreement (PPA): Immediate savings with no upfront costs.
- Loan Option: Savings typically begin within the first year.
- Cash Purchase: Higher initial investment, but substantial savings after reaching the break-even point in a few years, leading to significant long-term savings.
Rising Electricity Costs in New Jersey:
New Jersey’s electric rates are increasing faster than ever, driven by stringent environmental targets. Utility companies are mandated to spend billions to meet these goals, resulting in higher electric costs for consumers. Solar energy offers a proactive way to combat these rising costs, providing stable and predictable energy expenses.
Break-Even Point and ROI
The break-even point for a solar investment in New Jersey typically ranges from 7 to 9 years. This is the period after which the initial cost of the solar system has been recovered through energy savings. After this point, the savings are effectively pure profit.
- Break-Even Point: Most homeowners in New Jersey can expect to recoup their solar investment within 7 to 9 years.
- Return on Investment (ROI): The typical ROI for solar installations in New Jersey ranges from 9% to 12%. This means that over the lifetime of the solar system, homeowners can expect to see a return of 9% to 12% on their initial investment annually.
Switching to solar energy in New Jersey not only helps achieve environmental goals but also offers substantial financial benefits over traditional energy sources.
Total Cost of Ownership and Maximizing Your Electricity Savings
Investing in higher-quality solar equipment and experienced installers in New Jersey may require a higher upfront cost, but it leads to significant long-term savings. Quality panels and components ensure durability and efficiency, reducing the likelihood of frequent repairs, replacements, and change orders. This minimizes overall expenses and maximizes energy production, leading to greater electricity savings. Furthermore, reputable installers offer robust warranties, providing financial protection and peace of mind. Ultimately, choosing premium solar solutions results in reliable performance, efficient energy generation, and a better return on investment, enhancing the overall value of your solar system.
Comparing Solar Providers
When comparing solar providers, remember that cheaper doesn’t always mean better. If a provider is emphasizing the lowest price per watt (PPW), it’s important to be cautious.Sometimes, these lower prices can come with trade-offs in quality, such as subpar installation or inadequate customer support.
One of the best ways to pick the right one is to look at Google reviews to gauge customer satisfaction and experiences. However, it’s essential to read not only about the installation process but also about the post-install support, as ongoing service and maintenance can significantly impact your overall experience. Providers with strong post-install support often ensure that any issues are addressed promptly, helping you maximize the benefits of your solar system over time.
It’s often worth paying a bit more for a provider that offers high-quality installation and excellent customer service. Investing in a reliable system and a responsive support team can save you from headaches and additional costs down the road. Keep your red flag meter on and prioritize long-term value over the initial price tag
Best Panel Choices for 2024
In 2024, the Qcells Q.Peak Duo BLK-G10+ stands out as a top solar panel, offering up to 22% efficiency at a more affordable price, making it a great choice for homeowners. Close behind are the Silfab Prime SIL-430 HL, which also reaches 22.1% efficiency with a 30-year performance warranty, and the REC Alpha Pure-R, delivering up to 21.9% efficiency with strong durability and a solid warranty. Together, these panels combine efficiency, reliability, and value, making them excellent options for those looking to invest in solar energy this year.
FAQs
- How much can I save with solar energy?
Savings vary by location and system size, but homeowners often save 20-50% on their electricity bills. - What are Tier 1 panels?
Tier 1 panels are high-quality solar panels from reputable manufacturers known for their efficiency and durability. - Do I need to maintain my solar system?
Solar systems require minimal maintenance, but regular inspections and occasional cleaning are recommended. - How long does the installation process take?
The installation process typically takes one to three days, depending on the system size and complexity. From install day to activation day, you can expect 3-6 months. - What happens if my solar system produces more energy than I use?
If your system generates excess energy, it can be fed back into the grid, often earning you credits through net metering. - What if I have an old roof?
No worries! A trustworthy solar company always conducts a thorough roof assessment before installation. So, don’t fret about placing new panels on an aging roof—it might not pass the initial survey if it’s too old. If it’s a concern, we can explore roofing solutions. However, your roof might surprise you and pass with flying colors! - Can I install solar panels on a flat roof?
Yes, solar panels can be installed on flat roofs using specialized mounting systems to optimize sun exposure. - What if I have a new roof?
A new roof is certainly better than an old roof. When I get asked this question it typically leads me to believe you are wondering about the warranty with the current roof provider. Most of the time, if your roof brand is a national, recognized brand like Owens Corning or GAF or any similar brand, then solar will not void the roof warranty. But please make sure your installer is certified and insured and reputable. A good solar company will also provide you with at least a 10 year roof penetration warranty. - How does solar affect my home resale value?
According to an extensive 2018 Zillow study and report, solar systems installed on homes in New Jersey see an average increase of 9.9% on the value of the home. This makes sense because a home with solar is able to provide a lower cost of ownership due to a lower and protected electric bill, hence lowering homeownership expenses to the next prospective buyer.
Conclusion
Choosing to go solar is a significant step toward reducing your energy bills and contributing to a more sustainable future. As you navigate this process, understanding the various incentives and rebates available, the importance of quality maintenance and warranties, and the differences between solar providers will help you make a well-informed decision.
With the right approach and careful consideration, transitioning to solar energy can be a rewarding and financially beneficial choice, paving the way for a cleaner and more efficient energy future.
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