Are Solar Panels Worth the Investment in New Jersey?
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If you live in New Jersey and have thought about investing in solar panels, you may have been skeptical for any number of reasons. Solar panels seem intimidating for some people, and they do require some exploring for consumers. Here at 100K Solar, we are here to demystify solar panels for our prospective clients and provide expertly done solar panel installation in New Jersey. We are confident that once you get all of the numbers on the page, they will speak for themselves.
The good news is that for most people, investing in solar just makes good sense. For one thing, state and local governments are more determined than ever to find ways of providing sustainable energy for our economy, and have approved a number of measures to incentivize going solar. And the technology continues to improve at warp speed, so you will get more value when you choose solar now than if you had made the decision in recent years.
Here at 100K Solar, we continue to stay on top of the latest developments in the solar energy industry. The more arrays we install, the better and more efficient we become at installing. We have seen every kind of roof, and know exactly how to array your panels so that they provide the most power. Having said that, there are some key questions one must have answered before knowing whether solar panels are right for you. Keep reading, and you will learn what those questions are, and how to answer them.
How Much Electricity Does Your Household Currently Use?
When you examine your monthly electric bill, you should see a section that shows approximately how much electricity you have used during each of the past 12 months. From this information, or from your online account, you should be able to determine how many kilowatt hours you have used over the past year. (You may need to contact your electricity provider for accurate information.) You can also compare how your use has changed for a given month (e.g. July) from year to year. Using this information, you can make an educated guess as to how much electricity you will use over the next twelve months.
This is a critical step, because knowing your expected usage will enable you to determine the size of the solar array you will need, and the type of panel. If you are concerned about a high number, try to consider ways to reduce your consumption. Long-lasting light bulbs and newer, more efficient appliances can make a huge difference in lowering your demand. This can reduce the size of any array you might purchase. However, if your number is still high, this can be another big reason to go solar. The more you consume, the more you will save with a larger array.
Get a Free, In-home Solar Energy Consultation
Once you have retrieved your latest bill and usage information from your account, the next step is to invite one of our solar advisors to your home to give you a free consultation. This step is necessary, because only a trained advisor will be able to examine your roof and property to determine how much direct sunlight you receive, as well as the angle at which that sunlight strikes your roof. Because New Jersey is in the northern hemisphere, your consultant will try to quantify the amount of roof space that faces to the south; this is the space where your panels will be installed.
Your advisor will also quantify the impact of trees or other obstructions that might hinder your solar production. If such concerns arise, you may want to have trees removed or trimmed to make your array more effective. Your advisor will also determine the age and quality of your roof, and recommend replacing it if you can determine that your roof would otherwise begin to fail during the lifespan of your solar array. Your advisor will also know how many days of good sunlight you have in your region, and how much power you can generate on days when the sun doesn’t cooperate.
After inspecting your roof and property, your advisor will discuss with you the cost of your array. Your usage numbers and budget will imply the number and type of panels to purchase, and your advisor will discuss the features and advantages of each brand. In most cases, homeowners seek financing, which enables them to acquire a new array with no money down. Often, the cost of a new roof or other improvements can be absorbed by your loan; it really depends on your situation and credit score. If you pay the entire cost of your system up front, you will save money.
Unlike electricity usage, your panels are a fixed monthly payment. So while your electric company continues to hike the rates of electricity over the next thirty years, you will be paying the same monthly payment, until your loan is paid off. At that point, you will only pay a few dollars each month in service charges, and you will not receive an electric bill. Instead, after 12 months, your electricity production will be reconciled against your consumption, and you will be billed (or refunded) for the difference. (See New Jersey Net Metering, below.)
Explore Your Solar Energy Incentives
While your solar advisor is in your home going over your estimate, we will also discuss ways to reduce the cost of your array with the various solar energy incentives provided by state and federal governments. These incentives will be figured into your estimate. Here are the big ones:
New Jersey Sales Tax Exemption
When you purchase solar panels for your home, you will not have to pay the 7% state sales tax. This can reduce the cost of your array by about one fifteenth, or 7%. To give you an idea, an array that would normally cost $15000 would instead cost about $14000.
New Jersey Property Tax Exemption
If your new solar array raises the value of your home once it is installed, the state cannot charge property tax on the amount your home increased. They must assess the home’s value as though it did not have panels.
New Jersey Net Metering
As explained earlier, when you have a solar array and net metering, you will not receive a monthly electric bill. Instead you will have a small monthly service charge. Over the course of the year, during certain months, you will produce more electricity than you use, and sell the excess back to the grid. In other months, you will use more than you produce, and borrow it from the company. Only at the end of the year will the positive and negative balances in consumption be reconciled, to give you one net bill. Usually, your bill is tiny. In many cases, it will be negative, and your electric company will send you the difference or credit it to your account.
Transition Renewable Tax Credits (TRECs)
For every 1000kWh generated by your array, you receive one TREC. You can sell these credits back to the company to offset your other costs. To give you an idea, in November of 2021, one TREC had a cash value of $91.20. For more information on TRECs, click here.
The Investment Tax Credit, and other Federal Tax Credits
A number of federal credits are available for builders who want solar panels. The most important of these is the Investment Tax Credit (or ITC) which enables you to receive a rebate from the federal government in the form of a tax credit. This means that during the year that you purchase your solar array, your income tax bill will be reduced by up to 26% of the value of your panels. This incentive will only be around until the end of 2023, so if you are planning to go solar, it is important that you take advantage of it while it is still available.
There are other Federal Incentives available to property owners. Check with the U.S. Energy Information Administration (EIA) for more information.
Is it Worth it to Go Solar in New Jersey?
Based on everything we have just told you, the answer should be ‘yes’. But only you can say whether it is worth it. If you are simply trying to save money, then remember this: When you purchase solar equipment, you will pay no money up front (assuming you finance), and your electric bill disappears. Think about that. You will have a fixed monthly cost for the loan payments for your system, but that payment is often less than your average monthly bill.
You will have to determine that you have enough quality roof space and sunlight to generate the amount of electricity you will need. But most homes do. Even if you don’t, a solar array will help you offset a large chunk of your bill. Your solar advisor’s job is to take into account everything that might affect your expense, and factor that into your estimate.
Once you sit down with us, everything should become clear. Many who do so find themselves looking at numbers that are too good to be true, and have to confront fear of the unfamiliar. But in this case, fortune favors the bold, and once our clients step forward in faith, they are pleasantly surprised at how much money they can save.