Summary

The New Jersey Board of Public Utilities (NJBPU) voted on May 21, 2026 to reduce the residential Administratively Determined Incentive (ADI) — the program most homeowners know as SREC-II — from $85 to $77 per megawatt-hour. That new rate applies to any residential solar system whose registration is received on or after July 27, 2026. Systems registered before that date remain locked at the higher $85 rate for their full 15-year incentive term.

The $8 per MWh difference is modest on a monthly basis, but because the incentive qualification life is 15 years and one certificate is earned for each megawatt-hour of qualifying production, the gap compounds across the life of the program. Any solar proposal, online calculator, or sales presentation that still uses $85 for a newly registered residential project is out of date and will overstate your earnings.

The good news: New Jersey’s solar incentive stack remains one of the strongest in the country. The ADI program, full 1:1 retail-rate net metering, a 6.625% sales tax exemption, and a 100% property tax exemption still work together to make residential solar financially meaningful — even in the absence of the federal residential tax credit, which expired on December 31, 2025. The $77 rate is a recalibration, not a program collapse.

Green Sun Energy Services installs residential solar throughout Monmouth County and can prepare a savings projection that reflects the current $77/MWh ADI rate — along with every other incentive that applies to your specific home and utility. Learn more about solar panel installation in New Jersey or read about how JCP&L electric rates are expected to rise through 2028, which affects the value of every kilowatt-hour your panels produce.

What exactly is the SREC-II program, and how does it work for a New Jersey homeowner?

New Jersey’s solar incentive program has gone through several names and structures, which causes genuine confusion. The current program for residential homeowners is formally called the Successor Solar Incentive (SuSI) Administratively Determined Incentive, or ADI. Most homeowners and installers still call the certificates it produces SREC-IIs. The program was created by the NJBPU on July 28, 2021, as a replacement for the original volatile SREC market, and is authorized under New Jersey’s Clean Energy Act of 2018.

The mechanics are straightforward: according to the NJBPU’s May 21, 2026 order, your solar system earns one SREC-II certificate for each megawatt-hour (1,000 kilowatt-hours) of qualifying solar electricity it produces. The BPU sets a fixed dollar value — the Administratively Determined Incentive — for those certificates. That rate locks in at the time your system is registered and does not change for the entire 15-year incentive qualification period. Payments are made quarterly.

Unlike the old SREC market, where prices swung wildly (historically ranging from roughly $20 to over $600 per certificate depending on market conditions), the ADI program gives homeowners a predictable, fixed income stream. Registration is handled through the NJ Clean Energy Program and your licensed installer manages the process on your behalf. You do not bid into a competitive market; the rate is set administratively by the BPU.

Why did New Jersey cut the residential ADI rate from $85 to $77 per MWh?

The NJBPU conducted its required three-year review of the SuSI ADI program and held a public board meeting on May 21, 2026. The resulting order reduced the residential market segment incentive level from $85/MWh to $77/MWh, effective for registrations received on or after July 27, 2026. The official board order (Docket Nos. QO20020184 and QO26030096) contains the full staff recommendation and supporting analysis.

The reduction reflects strong residential solar demand. As reported by Xpansiv, a certificate market platform that covers NJ solar policy, the BPU made this adjustment because demand for residential solar continues to significantly exceed available program capacity — meaning homeowners were adopting solar at very high rates even at the $85 level. A program that is consistently oversubscribed is a signal to regulators that the incentive may be higher than necessary to drive adoption.

This is consistent with the BPU’s stated long-term goal: reducing the cost of solar incentives over time while maintaining a competitive solar market in New Jersey. The reduction is not a sign that solar is less viable — it is a sign that solar has become popular enough that the state felt it could lower the subsidy without slowing adoption. Residential demand was running at approximately 5.2 MW of new registrations per week during Energy Year 2026, according to analysis of program data published by homesolarcostguide.com.

How much does the $8 per MWh reduction actually cost a homeowner over 15 years?

Eight dollars per megawatt-hour sounds small in isolation, but SREC-II income accumulates over 15 years of production, so the difference is real. The math depends on your system size and roof orientation, but a few reference points help frame it.

For a typical 8 kW residential system, NuWatt Energy’s SuSI/ADI program guide estimates annual ADI income of approximately $739 at the $77/MWh rate, based on average New Jersey production figures. At the prior $85/MWh rate, that same system would have earned approximately $808 per year — a difference of about $69 annually, or roughly $1,035 over the full 15-year term for a system of that size.

Larger systems feel the difference more. For a 13 kW system producing approximately 14,700 kWh per year, the $85 rate generated roughly $9,600 more over 15 years than no ADI income at all; the $77 rate reduces that total by approximately $1,755 compared to the old rate over the same period. These are estimates based on average production assumptions — your actual numbers depend on your roof angle, shading, and location in New Jersey. The key point is that any solar savings proposal prepared before July 27, 2026 that uses $85/MWh for a newly registered system needs to be updated, because it will overstate your expected ADI income.

Does the rate cut affect systems that were already registered before July 27, 2026?

No. The rate change applies only to new registrations received on or after July 27, 2026. According to NuWatt Energy’s ADI program guide, systems registered before that date lock in $85/MWh for their full 15-year payment term, and the rate does not change regardless of future BPU rate adjustments.

This is one of the most important structural features of the ADI program: whatever rate is in effect at the moment your system is registered is the rate you receive for the entire 15-year incentive life. The BPU can change the rate for future registrations — as it just did — but it does not reach back and reduce the rate for existing participants. Homeowners who registered before July 27, 2026 are not affected by this change at all.

For homeowners who are in the middle of a solar installation process and whose registration had not been submitted by July 26, 2026, the $77 rate is what applies. If you are evaluating a proposal right now, confirm with your installer exactly when and how registration is submitted, and ask them to show you a savings projection that uses $77/MWh rather than $85/MWh. That small difference in the input number produces a meaningfully different output over 15 years.

What other New Jersey solar incentives are still in place alongside SREC-II?

The ADI program is the most discussed NJ solar incentive, but it is only one layer of a broader financial picture. Three additional programs remain intact in 2026 and apply to most Monmouth County homeowners.

Net metering allows you to receive a full 1:1 retail-rate credit for every kilowatt-hour your solar panels export to the grid. According to NuWatt Energy’s net metering guide, the credit rate depends on your utility: Atlantic City Electric customers receive approximately $0.30/kWh, PSE&L customers approximately $0.27/kWh, JCP&L customers approximately $0.21/kWh, and RECO customers approximately $0.27/kWh. Monthly surplus credits roll over to the following month, and an annual true-up settles any remaining balance. Net metering and the ADI program run simultaneously and independently — earning one does not reduce the other.

Sales tax exemption: All solar energy equipment sold in New Jersey is exempt from the state’s 6.625% sales and use tax. SolarReviews’ New Jersey incentive guide confirms this covers equipment that provides electrical power through the conversion of solar energy. On a typical system, this saves thousands of dollars at the point of purchase.

Property tax exemption: Under New Jersey law, the added value a solar system contributes to your home’s assessed value is 100% exempt from property taxes. SunnyMac’s NJ incentives guide notes that your local tax assessor cannot increase your property tax bill because of the panels. Given New Jersey’s property tax burden — among the highest in the nation — this exemption can represent hundreds of dollars in annual savings for as long as the system is on your roof. You typically need to notify your local municipal tax assessor after installation to activate it.

What happened to the 30% federal solar tax credit, and does it affect NJ savings projections?

The 30% federal Residential Clean Energy Credit (Section 25D) expired on December 31, 2025. NuWatt Energy’s NJ solar tax exemptions guide notes that this expiration was enacted under the One Big Beautiful Bill Act signed on July 4, 2025. There is no federal tax credit for homeowner-owned solar systems placed in service after December 31, 2025. Any sales presentation or website that still advertises a 30% federal tax credit for a 2026 or 2027 residential installation is incorrect.

Third-party-owned systems — meaning solar leases and power purchase agreements (PPAs) — operate under different tax rules. The commercial clean electricity credit (Section 48E) remains available to the financing company that owns the system, and some of that value is passed through to homeowners via lower lease or PPA rates. Green Sun Energy offers solar lease options in New Jersey; you can review the $0-down solar lease program or read a detailed comparison of cash vs. lease solar in New Jersey to understand which financing path makes sense for your situation.

With the federal credit gone for homeowner-owned systems, the ADI incentive, net metering, and the two tax exemptions carry more relative weight in any savings analysis than they did in prior years. The $8/MWh ADI reduction matters more in a 2026 proposal than it would have in 2024, when the federal credit offset a large share of system cost upfront.

Should a Monmouth County homeowner still go solar given all these changes?

New Jersey remains one of the stronger residential solar markets in the country, even after the federal credit expiration and the ADI rate reduction. SurgePV’s 2026 NJ solar incentives guide notes that New Jersey is one of the few states where the remaining state incentive stack is strong enough to keep residential solar financially attractive after the federal credit ended. The combination of a 15-year fixed ADI payment, retail-rate net metering, and permanent tax exemptions creates a durable financial case — it just requires honest math based on current figures.

For Monmouth County homeowners specifically, JCP&L is the dominant utility, and retail electricity rates there have been rising. A solar system locks in a portion of your electricity supply at a fixed production cost while simultaneously earning quarterly ADI income. Those two effects — reduced utility bills and ADI cash flow — work together across a timeline that extends well beyond the 15-year incentive period, because quality solar panels continue producing electricity for decades beyond the incentive period, even after SREC-II payments stop.

The roof your panels sit on matters too. A system installed on a failing or aging roof is a problem waiting to happen. Green Sun handles both solar panel installation and roofing, so if your roof needs attention before panels go up, that can be addressed as part of the same project rather than creating conflicts between separate contractors later. And if energy resilience is part of your planning — protecting against grid outages during New Jersey storm seasons — Generac standby generators can complement a solar installation to keep critical loads running regardless of what the grid is doing.

How do I make sure any solar proposal I receive uses the correct current ADI rate?

The most direct step is to ask your installer to state in writing the ADI rate used in the savings projection and the source of that figure. The current rate for systems registered on or after July 27, 2026 is $77/MWh, per the NJBPU’s May 21, 2026 order. You can also confirm the live current rate at cleanenergy.nj.gov, the official New Jersey Clean Energy Program website, before signing any contract.

Beyond the ADI rate, ask the installer to show you the system’s projected annual production in kilowatt-hours, the net metering value based on your specific utility’s current rate, and whether the savings projection separates ADI income from utility bill savings. These are three distinct financial benefits that should be modeled individually. A proposal that bundles them into a single annual savings figure without showing the components is harder to verify and harder to compare across installers.

Also confirm who handles ADI registration and when. Registration timing determines which rate applies. According to NuWatt Energy’s SuSI/ADI guide, registration is automatic through your licensed installer — you do not need to register independently — but your rate locks at the moment registration is received by the NJ BPU, not at the moment you sign your contract or the panels are installed. Ask your installer to confirm their registration timeline relative to your installation date.

Frequently Asked Questions

What is the current NJ SREC-II (ADI) rate for residential solar in 2026?

For residential solar systems whose registration is received on or after July 27, 2026, the Administratively Determined Incentive (ADI) rate is $77 per megawatt-hour, per the NJBPU’s May 21, 2026 board order. Systems registered before that date remain locked at the prior $85/MWh rate for their full 15-year term. You can confirm the current live rate at cleanenergy.nj.gov before signing any contract.

Does the SREC-II rate cut affect my existing NJ solar system?

No. If your system was registered before July 27, 2026, your rate is locked at whatever was in effect at registration — likely $85/MWh — and it does not change for the entire 15-year incentive qualification life. The new $77/MWh rate applies only to registrations received on or after July 27, 2026.

How much will I earn from SREC-II payments on a typical NJ home solar system?

At the current $77/MWh rate, a typical 8 kW residential system in New Jersey earns approximately $739 per year in ADI income, based on average statewide production figures. Over the full 15-year incentive period, that is roughly $11,085 — before factoring in any panel degradation. Actual earnings depend on your system size, roof orientation, and shading.

Is there still a federal solar tax credit for New Jersey homeowners in 2026?

No. The 30% federal Residential Clean Energy Credit (Section 25D) expired on December 31, 2025. Homeowner-owned solar systems installed in 2026 do not qualify. Solar leases and power purchase agreements operate under different rules, and the financing company — not the homeowner — may claim a commercial clean energy credit on those projects.

What other NJ solar incentives still apply in 2026 alongside SREC-II?

Three additional programs remain in effect: full 1:1 retail-rate net metering (credit rate varies by utility, from approximately $0.21/kWh for JCP&L customers to $0.30/kWh for Atlantic City Electric customers), a 6.625% state sales tax exemption on all solar equipment, and a 100% property tax exemption that prevents your home’s assessed value from rising due to the solar installation. These programs are independent of the ADI program and apply simultaneously.

How do I know if a solar quote I received still uses the old $85/MWh SREC-II rate?

Ask the installer to show you the ADI rate used in the savings projection and the source. Any proposal prepared before July 2026 for a system not yet registered should be updated to $77/MWh. A proposal using $85 for a new registration will overstate your expected ADI income by approximately $8 per megawatt-hour across 15 years of production.

When does the SREC-II rate lock in for my system?

Your rate locks at the moment your licensed installer submits your registration to the NJ BPU — not when you sign your contract, and not when your panels are physically installed. The rate that is in effect on your registration date is the rate you receive for the full 15-year incentive qualification life. Ask your installer to confirm their expected registration timeline before you sign.

Is solar still worth it in Monmouth County, NJ after the ADI rate cut?

For most homeowners with a suitable roof and a meaningful electric bill, yes. The ADI reduction from $85 to $77 is approximately 9%, which affects the total incentive value but does not eliminate it. New Jersey’s combination of 15-year fixed ADI payments, retail-rate net metering, a sales tax exemption, and a property tax exemption still makes the state one of the stronger residential solar markets in the country, even without the federal tax credit.

The Bottom Line

New Jersey’s residential SREC-II (ADI) incentive is now $77 per megawatt-hour for any system registered on or after July 27, 2026. That is the number that should appear in every current solar savings projection for a new Monmouth County installation. The $8/MWh reduction from the prior $85 rate is real and compounds over 15 years, but it does not change the fundamental case for solar in New Jersey. The ADI program, retail-rate net metering, and two permanent tax exemptions still work together to deliver meaningful financial returns — they just need to be modeled accurately. Any proposal that still shows $85 for a new registration is out of date.

The broader picture for New Jersey homeowners is that incentive programs do change, and they have generally moved in one direction: down, as solar adoption rises and the state adjusts subsidy levels accordingly. Locking in today’s rate — $77/MWh for 15 years — is a fixed, known quantity. Future rate changes will affect future registrations, not yours. That is a reason to move on a well-designed proposal now rather than waiting for conditions that may not improve. You can also explore how solar equipment prices are expected to move in New Jersey in 2027 and review how much solar adds to your home’s value in New Jersey as part of a complete financial picture.

Green Sun Energy Services installs residential solar throughout Monmouth County and will provide savings projections built on the current $77/MWh ADI rate, your actual utility, and your roof’s real production potential. The team also handles roofing, Generac standby generators, and EV charger installation — so if your energy project involves more than panels alone, everything can be coordinated through one local contractor. Visit greensunnj.com or review what past clients have said to get started.

NJ SREC-II Incentive Drops to $77/MWh: What Monmouth County Homeowners Need to Know