New Jersey Solar Savings Calculator: 2026 Updated

New Jersey Solar Savings Calculator

Calculate New Jersey solar costs, 2026 federal tax-credit status, SREC-II revenue, net metering, tax exemptions, payback period, and 25-year savings.

New Jersey 2026 rules: No state income tax credit for solar. The federal Section 25D credit ended for systems placed in service after December 31, 2025. The SuSI program pays SREC-II revenue to registered systems for 15 years. New Jersey mandates full retail net metering, exempts solar from property tax, and exempts solar equipment from sales tax.

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Estimates only. Verify utility rates, SREC-II registration and pricing, tax exemptions, and federal tax status with your utility, installer, and tax professional.

What Is the New Jersey Solar Savings Calculator?

The New Jersey Solar Savings Calculator estimates the upfront cost, payback period, and 25-year net savings of a residential solar panel system. It uses installation costs, electricity prices, expected solar production, export credits, and entered incentives to calculate annual financial benefits. It also estimates solar electricity production, household electricity offset, and CO2 offset.

The calculator is designed for New Jersey homeowners who want to understand how solar installation expenses compare with potential electricity savings and other financial benefits.

Its model estimates first-year solar production using 1,200 kilowatt-hours (kWh) per kilowatt (kW) of installed capacity. Production decreases by 0.5% annually throughout a 25-year projection.

Unlike a basic solar cost calculator, this tool includes a separate Annual SREC-II Revenue field. This allows users to include a specified yearly dollar amount in the savings projection. However, the calculator does not automatically determine SREC-II eligibility, calculate payments from electricity production, or enforce the 15-year payment period described in its informational notes.

How the New Jersey Solar Savings Calculation Works

The calculator combines installation costs, solar electricity production, electricity rates, and entered financial benefits. It then calculates when cumulative savings may recover the installation cost and how much net savings may remain after 25 years.

1. Calculate Gross Solar Installation Cost

The gross system cost is calculated by multiplying the solar system capacity by 1,000 and the entered installed cost per watt.

C_{\text{gross}}=S\times1000\times W

Where:

C (gross) = Installation cost before incentives, in dollars.
S = Solar system size in kilowatts (kW).
W = Installed cost per watt in dollars.
1,000 = Number of watts in one kilowatt.

For example, an 8 kW system installed at $3.00 per watt has a gross cost of:

8\times1000\times3.00=\$24,000

2. Calculate Net Installation Cost

The calculator subtracts entered federal credits, New Jersey state credits, and upfront rebates from the gross cost.

C_{\text{net}}=\max\left(0,C_{\text{gross}}-C_{\text{gross}}\frac{F}{100}-C_{\text{gross}}\frac{T}{100}-R\right)

Here, F represents the federal credit percentage, T represents the state credit percentage, and R represents upfront rebates in dollars.

Both percentage credits are calculated from the original gross installation cost. If the entered deductions exceed the installation cost, the calculator sets the net cost to $0.

Annual property tax savings and SREC-II revenue are not subtracted from the upfront cost. They are included separately in the model’s yearly financial benefits.

3. Estimate Annual Household Electricity Usage

The calculator estimates yearly household electricity consumption from the monthly electric bill and electricity price per kWh.

U=\frac{B\times12}{r}

Where U is annual electricity usage in kWh, B is the monthly electric bill in dollars, and r is the entered retail electricity rate in dollars per kWh.

This calculation assumes the entered bill can be converted into electricity consumption using a single per-kWh rate. It does not separately remove fixed utility charges from the bill.

A positive electricity rate is needed because the formula divides by that value.

4. Estimate Solar Electricity Production

The model uses a fixed first-year production factor of 1,200 kWh per kW of installed capacity.

For an 8 kW system, first-year electricity production is estimated at 9,600 kWh.

To estimate future production, the calculator applies an annual degradation rate of 0.5%.

P_y=1200S(1-0.005)^{y-1}

Here, P represents annual solar production, S is system size in kW, and y is the operating year from 1 through 25.

The model therefore assumes solar panels generate slightly less electricity each year while remaining in operation throughout the 25-year projection.

5. Calculate Self-Used and Exported Solar Electricity

The calculator divides annual solar production into 12 months using fixed seasonal percentages. From January through December, these percentages are 1%, 2%, 4%, 8%, 15%, 19%, 19%, 15%, 8%, 4%, 2%, and 3%.

For each month, it calculates self-used electricity as the smaller of the selected self-consumption share of production and one-twelfth of estimated annual household consumption.

H_{y,m}=\min\left(\frac{P_{y,m}h}{100},\frac{U}{12}\right)

Where H is monthly self-used electricity, P is monthly solar production, h is the entered Daytime Self-Consumption percentage, U is estimated annual household electricity usage, and m identifies the month.

The remaining monthly solar production is counted as exported electricity.

X_{y,m}=\max(0,P_{y,m}-H_{y,m})

Self-used electricity is valued at the entered retail electricity rate. Exported electricity is valued at the separately entered Export Credit rate.

6. Calculate Annual Solar Savings and SREC-II Revenue

The calculator combines the value of self-used electricity, export credits, property tax savings, and entered SREC-II revenue. It then subtracts annual utility solar fees.

N_y=H_y r_y+X_y e_y-A+Q+J

Where:

N = Calculated financial benefit for the year.
H = Total self-used solar electricity during the year, in kWh.
X = Total exported electricity during the year, in kWh.
r = Retail electricity rate for that year.
e = Export credit rate for that year.
A = Entered annual utility solar fees.
Q = Entered annual property tax savings.
J = Entered Annual SREC-II Revenue.

The calculator increases both the retail electricity rate and export credit rate by the entered Annual Utility Rate Increase percentage each year.

r_y=r_1\left(1+\frac{g}{100}\right)^{y-1}

e_y=e_1\left(1+\frac{g}{100}\right)^{y-1}

Here, g is the entered annual percentage increase. Annual utility fees, property tax savings, and SREC-II revenue remain fixed at their entered dollar amounts.

Important: The implemented model adds the entered SREC-II revenue in every year of its 25-year projection. It does not stop those payments after 15 years, even though the calculator’s informational notes describe a 15-year SREC-II payment period.

7. Calculate Payback and 25-Year Net Savings

The calculator adds annual financial benefits over 25 years and subtracts the net installation cost.

\text{25-Year Net Savings}=\sum_{y=1}^{25}N_y-C_{\text{net}}

Payback occurs in the first whole year when cumulative modeled savings reach or exceed the net installation cost.

If the net cost is $0, the calculator displays Immediate. If cumulative savings do not recover the cost within 25 years, it displays 25+ Years.

New Jersey Solar Savings Calculation Example

Consider a hypothetical homeowner using the calculator’s default settings.

Calculator Input	Example Value
Monthly Electric Bill	$140
Electricity Rate	$0.210/kWh
System Size	8 kW
Installed Cost per Watt	$3.00
Export Credit	$0.210/kWh
Daytime Self-Consumption	30%
Annual Utility Rate Increase	4%
Annual Utility Solar Fees	$0
Federal Credit	0%
New Jersey State Credit	0%
Upfront Rebates	$0
Annual Property Tax Savings	$100
Annual SREC-II Revenue	$0

Step 1: Calculate the installation cost. An 8 kW system at $3.00 per watt costs $24,000. With no entered upfront credits or rebates, the net installation cost is also $24,000.

Step 2: Calculate annual household electricity usage.

\frac{140\times12}{0.210}=8000\text{ kWh}

Step 3: Calculate first-year solar production.

8\times1200=9600\text{ kWh}

Step 4: Calculate first-year self-consumption and exports. At 30% self-consumption, the model assigns 2,880 kWh to household use and 6,720 kWh to exports.

Step 5: Calculate the first-year financial benefit. Both self-used and exported electricity are valued at $0.210/kWh. The model also adds $100 in annual property tax savings and $0 in SREC-II revenue.

(2880\times0.210)+(6720\times0.210)+100=\$2116

Step 6: Project the following 24 years using 4% annual electricity rate growth and a 0.5% annual production decline. The calculator continues adding $100 in annual property tax savings throughout the projection.

The resulting estimates are:

Calculated Result	Estimated Value
Gross System Cost	$24,000
Net Installation Cost	$24,000
Year 1 Solar Production	9,600 kWh
Annual Household Usage	8,000 kWh
Calculated First-Year Self-Use	2,880 kWh
Calculated First-Year Exports	6,720 kWh
Calculated First-Year Financial Benefit	$2,116
Payback Period	10 Years
25-Year Net Savings	$56,814
Solar Offset	120%
25-Year CO2 Offset	101.8 tons

The model calculates approximately $80,814 in cumulative financial benefits over 25 years. After subtracting the $24,000 installation cost, the remaining net savings are approximately $56,814.

These are hypothetical results based on the calculator’s default assumptions. Actual installation costs, electricity production, utility compensation, and tax treatment may differ.

How to Use the New Jersey Solar Savings Calculator

Enter your Monthly Electric Bill. Provide your monthly electricity expense in dollars. The default is $140.
Enter your Electricity Rate. Use your electricity price in dollars per kWh. The default is $0.210/kWh.
Set the System Size. Enter your proposed solar installation capacity in kW. The default is 8 kW.
Enter Installed Cost per Watt. Provide the estimated installation price per watt. The default is $3.00.
Select your Utility. Choose PSE&G, JCP&L, Atlantic City Electric, or Rockland Electric.
Enter Export Credit and Daytime Self-Consumption. Specify the export compensation rate and the percentage of solar electricity used at home.
Adjust Annual Utility Rate Increase and Solar Fees. Enter your assumed annual electricity rate increase and any recurring solar utility fees.
Review the Battery Storage Checkbox. The checkbox is available, but checking it does not automatically change the financial calculation.
Enter applicable upfront incentives and tax savings. Adjust Direct Federal Credit, New Jersey State Credit, Upfront Rebates, and annual Property Tax Savings.
Enter Annual SREC-II Revenue. Provide the yearly dollar amount you want to include. The default is $0. Remember that the model applies this amount for all 25 years.
Click Calculate Savings. Review the costs, payback period, 25-year savings, and production estimates. Click Reset to restore the default entries and hide the previous results.

The monthly bill, electricity rate, system size, and installation cost fields are required. Numeric fields specify nonnegative minimums. Daytime Self-Consumption and credit percentages have limits of 0% to 100%, while Annual Utility Rate Increase has a range of 0% to 50%.

For meaningful calculations, enter a positive electricity rate and complete all numeric fields used by the model. The underlying calculation does not separately handle division by zero or blank optional numeric values.

Financial results appear in whole U.S. dollars. Electricity quantities are rounded to whole kWh, system size appears to one decimal place, Solar Offset is shown as a whole percentage, and the CO2 offset appears to one decimal place.

Important Assumptions Behind Your New Jersey Solar Savings Estimate

How to Interpret Payback and Net Savings

Gross System Cost represents the installation price before entered incentives. Net Cost represents the remaining amount after federal credits, state credits, and rebates.

Payback Period identifies the first whole year when cumulative modeled savings recover that net cost. A progress meter compares the estimated payback year with the 25-year projection period.

25-Year Net Savings represents cumulative modeled financial benefits minus net installation cost. A positive amount indicates that modeled benefits exceed the initial cost. A negative amount indicates that the system has not recovered its modeled upfront expense after 25 years.

New Jersey Net Metering and Export Credits

Net metering describes how electricity exported by a solar system is credited by a utility.

The calculator’s New Jersey information describes statewide retail-rate net metering with monthly credit rollover. Its default electricity rate and export credit are both $0.210/kWh.

However, the calculation does not separately model monthly credit rollover, settlement rules, or individual utility tariffs. Instead, it values every modeled exported kWh at the entered Export Credit rate.

The utility dropdown includes PSE&G, JCP&L, Atlantic City Electric, and Rockland Electric. Selecting a different utility does not automatically adjust electricity rates, export credits, fees, or financial results.

Check your utility’s actual compensation rules before choosing an export credit rate.

Understanding SREC-II Revenue

SREC-II refers to the solar renewable energy certificate incentive described in the calculator’s New Jersey program notes. These notes describe the SuSI program as providing payments to registered solar systems over 15 years.

The calculator also provides an Annual SREC-II Revenue field. Its default is $0, so no SREC-II income is included unless you enter an amount.

The model does not automatically multiply solar production by a certificate price. It uses the annual dollar amount entered by the user, without adjusting it for solar production decline.

The most important limitation is the payment duration: The model adds entered SREC-II revenue every year for 25 years, not just the 15 years stated in its informational notes.

For example, entering $500 as annual SREC-II revenue adds $12,500 to the calculator’s 25-year cumulative financial benefits. Fifteen years of $500 payments would total $7,500 instead. This difference can materially affect estimated payback and net savings.

When a positive SREC-II amount is entered, the results include an Annual SREC-II Revenue row. The SREC-II Revenue badge itself is informational and does not confirm registration or eligibility.

Verify any applicable SREC-II payment amount, registration requirements, and payment duration before relying on projected revenue.

Property Tax Savings and Other Incentives

The calculator’s 2026 informational notes describe New Jersey solar property tax and sales tax exemptions. Its Property Tax Savings field starts at $100 per year.

That $100 is an entered assumption, not an amount calculated from the home’s assessed value or local property tax rate. The model simply adds it to annual financial benefits throughout the 25-year period.

The model does not separately calculate sales tax savings. Any applicable sales tax treatment would need to be reflected in the installation cost entered by the user.

The Direct Federal Credit and New Jersey State Credit fields both start at 0%. The calculator’s notes state that the residential federal Section 25D credit ended for systems placed in service after December 31, 2025. They also describe New Jersey’s SREC-II program as distinct from a state income tax credit.

These are the calculator’s stated assumptions. Entering a nonzero credit or rebate changes the mathematical result but does not determine whether an individual installation qualifies for that incentive.

Self-Consumption, Battery Storage, and Utility Rate Growth

Daytime Self-Consumption determines the share of monthly solar production assigned to household use, subject to the model’s monthly usage cap.

If the entered retail electricity rate exceeds the export credit rate, increasing self-consumption generally increases modeled savings. If the two rates are equal, as in the default settings, self-used and exported electricity receive the same monetary value per kWh.

The battery storage checkbox does not automatically change self-consumption, installation expenses, or savings. The model does not separately simulate battery charging, discharging, or replacement costs.

The default Annual Utility Rate Increase is 4%. The calculator applies that increase to both retail and export credit rates every year while reducing annual solar production by 0.5%.

Solar Offset and CO2 Offset

Solar Offset compares first-year solar electricity production with estimated annual household electricity usage.

\text{Solar Offset (\%)}=\frac{\text{Year 1 Solar Production}}{\text{Annual Electricity Usage}}\times100

For the default inputs, 9,600 kWh of solar production divided by 8,000 kWh of household usage produces a 120% Solar Offset.

A value above 100% means modeled annual production exceeds estimated annual household usage. It does not necessarily mean the homeowner will have no electricity charges.

If estimated annual electricity usage is zero or less, the calculator sets Solar Offset to 0%.

The 25-Year CO2 Offset uses cumulative modeled solar production and a fixed conversion factor of 0.45 tons per 1,000 kWh.

\text{25-Year CO2 Offset}=\frac{\text{Total 25-Year Solar Production}}{1000}\times0.45

This is a simplified production-based estimate, not a measurement of the actual emissions avoided at a particular property.

Important Result-Label Limitations

Some labels in the implemented calculator do not match the values passed to them:

Year 1 Self-Use kWh: This row displays the final simulated year’s self-consumption value, corresponding to year 25 instead of year 1.
Year 1 Export kWh: This row also displays the final simulated year’s exported electricity amount rather than the first year’s value.
Net Year 1 Savings: This row displays the positive portion of the calculated 25-year net savings, or $0 if that long-term result is zero or negative. It does not display the actual modeled first-year financial benefit.

With the default settings, Net Year 1 Savings displays $56,814, even though the model’s first-year financial benefit is $2,116.

The rows labeled Year 1 Self-Use kWh and Year 1 Export kWh display approximately 2,554 kWh and 5,958 kWh. These correspond to year 25, rather than the calculated first-year values of 2,880 kWh and 6,720 kWh.

The Property Tax Exempt badge is also informational. It does not verify an individual property’s treatment or change according to the Property Tax Savings amount entered.

The model does not separately calculate financing interest, routine maintenance, equipment replacement, detailed hourly electricity demand, or changes in SREC-II payment terms. Actual costs and savings may differ. Verify important assumptions with your utility, installer, and tax professional when appropriate.

Frequently Asked Questions

How much can solar panels save in New Jersey?

Potential savings depend on installation cost, system size, electricity rates, export credits, annual fees, and entered incentives. Using the calculator’s default settings, the model estimates approximately $56,814 in net savings over 25 years. This includes an assumed $100 in annual property tax savings but no SREC-II revenue. It is a hypothetical projection, not a guaranteed financial return.

How long does it take for solar panels to pay for themselves in New Jersey?

The calculator determines payback by finding the first whole year when cumulative modeled financial benefits equal or exceed the net installation cost. Its default values produce a 10-year payback period. Changing installation expenses, electricity rates, export credits, annual fees, or entered incentive amounts can change the result.

Does the calculator automatically include SREC-II payments?

No. Annual SREC-II Revenue defaults to $0. Users must enter an amount to include these payments. The calculator does not automatically calculate revenue from solar production or verify program eligibility. It also applies the entered amount for all 25 years, despite the 15-year payment period described in its notes.

Does New Jersey net metering pay the full retail electricity rate?

The calculator’s informational notes describe retail-rate net metering with monthly credit rollover. Its default export credit equals its default retail electricity rate of $0.210/kWh. However, the calculation does not verify a particular utility tariff or separately model credit rollover. Users should confirm their actual export compensation terms before entering a rate.

Does selecting a different New Jersey utility change the calculation?

No. The dropdown includes PSE&G, JCP&L, Atlantic City Electric, and Rockland Electric, but the implemented calculation does not use that selection to adjust financial results. To evaluate different utility conditions, manually change the electricity rate, export credit, and annual utility solar fees.

Does the calculator account for New Jersey property tax savings?

Yes. The Property Tax Savings field starts at $100 per year, and the calculator adds that amount to every year’s modeled benefits. However, it does not calculate actual savings from assessed property value or local tax rates. The entered amount is a financial assumption, not a verified property tax benefit.

Can the 25-year solar savings result be negative?

Yes. Negative 25-year net savings mean that cumulative modeled financial benefits remain below the net installation cost. Higher upfront expenses, lower electricity rates, reduced export credits, or greater annual fees can contribute to a negative estimate. The result depends on the entered assumptions and does not guarantee an actual financial loss.

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New Jersey Solar Savings Calculator