PV Solar Panel FAQs
In this section, we help our readers answer questions such as: What is a solar panel system? What are the benefits of having solar panels? How much do solar panels cost? What solar rebates and incentives are available? What’s a solar renewable energy certificate (SREC)?
Q: What is a solar panel system?
Solar panel systems (or solar energy systems) use Photovoltaic (PV) cells to convert sunlight into direct current (DC) electricity. Solar panel cells are made from silicon and were originally developed to power spacecraft and space stations. The cells are wired together in panels that typically measure about 4 feet by 2 ft by 1.5 inches deep. A group of solar panels mounted on a frame is called a solar panel array.
To provide electricity reliably and safely, solar panel system components typically include an inverter, wiring and optional battery storage and charge controller. Most solar panel systems convert the DC electricity that is produced by the solar panels into the common household form of electricity, alternating current (AC), by using an inverter. AC electricity can then be used to power your appliances directly, or feed back to an electric utility's grid. The DC electricity can also be stored directly in batteries for later use. In this case, to prevent overcharging or discharging of the batteries, a charge controller is used.
Q: What are the benefits of having solar panels in New Jersey?
Reduce your utility bill
Solar panel systems can significantly reduce your utility bill. Any energy produced for free by the sun and your solar panel system is energy that you don't have to purchase from your utility. This translates into direct savings on your monthly utility bill. In addition to the direct savings, the solar panel arrays also act as a sunshade for your roof, reflecting heat from the sun that would otherwise be absorbed by your house. A shaded roof area can reduce the air temperature of your house, reducing the energy required by your air-conditioner to keep a comfortable temperature in your home.
Increase the resale value of your home
According to a report produced by the National Renewable Energy Laboratory entitled "A New Market Paradigm for Zero-Energy Homes: December 2006 The Comparative San Diego Case Study", Solar panels can increase the value of your home.
By using a renewable power source, you're helping reduce the impact of global warming and climate change. You will avoid producing hundreds of tons of greenhouse gases during the solar panel system lifetime.
You will also decrease your use of foreign oil and minimize utility company price increases.
srecQ: How Do I Go Solar In New Jersey?
Going solar in NJ is a simple as 1-2-3.
- Solar Evaluation of your Home. Schedule your phone or in person appointment through our website. Our Solar Site Assessment specialists will ask you a few simple questions and survey your home (via satellite roof evaluation) – to evaluate your home’s solar potential. Based on your Solar Site Assessment and your financial goals our team will determine which solar financing options and esign make the most sense for you.
- Solar Design, Permitting and Solar Installation. Once you feel comfortable with the solar program designed for you, we'll handle all of the permitting to install the solar panel system – typically installing your system in just one day!
- Utility Approval (PTO) and Activation. Once permission to operate is received from your utility provider, your solar energy system can be turned on to power your home – saving your family money while saving the environment.
Q: How much do solar panels cost?
The actual cost of solar panels will depend on equipment options, solar installation costs, and the solar panel manufacturer. Please click on Get an Estimate for details on how much "going solar" can save you. Read More
Q: How should I finance my solar panel system?
After you get past the mechanics of how solar works, you should come to realize that “going solar” is more like making a financial investment than doing a capital improvement on your home. Aside from the great environmental benefits of solar, most homeowners are focused on saving money by installing solar --- or, more importantly making money by installing solar panels. Read More
Q: Will a solar panels in New Jersey require additional insurance?
Typically, homeowners will be required by the utility company to provide proof of insurance coverage for their system. However, most standard homeowner insurance policies provide adequate insurance protection and meet the minimum requirements stated in your utility interconnection agreement.
Q: Will my property taxes go up if I install solar New Jersey?
No, in October of 2008, New Jersey enacted legislation exempting renewable energy systems used to meet on-site electricity, heating, cooling, or general energy needs from local property taxes. Please see Property Tax Exemption for Renewable Energy Systems for more information.
Q: Can Solar Panels Increase the Value of my home in New Jersey?
Yes, according to a report produced by the National Renewable Energy Laboratory entitled "A New Market Paradigm for Zero-Energy Homes: December 2006 The Comparative San Diego Case Study", Solar panels can increase the value of your home.
"The greatest single gain in value was $446,410 for a home in the SheaHomes communities with a PV system owned for 26.9 months (a 79% increase in value). In comparison, the single largest gain for a home in the comparison community was $378,769 for a home owned for 40.2 months (a 61% increase)."
When you lease your system, things are going to be different. "FannieMae, B2-3-04: Special Property Eligibility Considerations (12/16/2014)", indicates that: If the solar panels are leased from or owned by a third party under a power purchase agreement or other similar arrangement, the following are some of the requirements that apply: The solar panels may not be included in the appraised value of the property. The lease payment must be included in the debt-to-income (DTI) ratio calculation. This requirement does not apply in the case of a power purchase agreement if the payment goes entirely to pay for the energy. Any portion of the payment that does not go toward the purchase of the energy must be included in the DTI ratio.
Q: What solar rebates and incentives are available for businesses in New Jersey?
There are currently five solar incentives available to businesses in New Jersey. The first solar incentive is the investment tax credit (ITC), which currently allows you to deduct 30 percent of the cost of your solar energy system from your taxes. The second incentive is Modified Accelerated Cost-Recovery System (MACRS), followed by the Solar renewable Energy Certificate (SREC) program, sales tax exemption and property tax exemption.
Q: What solar rebates and incentives are available for homeowners in New Jersey?
There are currently four solar incentives available to homeowners in New Jersey. The first solar incentive is the investment tax credit (ITC), which currently allows you to deduct 30 percent of the cost of your solar energy system from your taxes. The second incentive is the Solar renewable Energy Certificate (SREC) program, followed by sales tax exemption and property tax exemption. Read More
Q: What is The Residential Renewable Energy Tax Credit?
According to the Solar Energy Industry Association (SEIA), A tax credit 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 ITC is based on the amount of investment in solar property.
A taxpayer may claim a credit for qualified expenditures for a system that serves a dwelling unit located in the United States that is owned and used as a residence by the taxpayer. Expenditures with respect to the equipment are treated as made when the solar panel installation is completed. If the solar installation is at a new home, the "placed in service" date is the date of occupancy by the homeowner. Expenditures include labor costs for on-site preparation, assembly or original solar panel installation, and for piping or wiring to interconnect a system to the home. If the federal tax credit exceeds tax liability, the excess amount may be carried forward to the succeeding taxable year. Read More
Q: I needed a new roof to hold the solar array.... does it qualify for the Federal Tax Credit, as it was an additional cost?
The instructions for Tax Form 5695 state the following:
Qualified solar electric property costs. Qualified solar electric property costs are costs for property that uses solar energy to generate electricity for use in your home located in the United States. No costs relating to a solar panel or other property installed as a roof (or portion thereof) will fail to qualify solely because the property constitutes a structural component of the structure on which it is installed. Some solar roofing tiles and solar roofing shingles serve the function of both traditional roofing and solar electric collectors, and thus serve functions of both solar electric generation and structural support. These solar roofing tiles and solar roofing shingles can qualify for the credit. This is in contrast to structural components such as a roof's decking or rafters that serve only a roofing or structural function and thus do not qualify for the credit. The home doesn't have to be your main home.
It looks like that sentence is saying: "a roof that is built to be able to hold a solar array counts as a structural component, and therefore counts as a cost of the project". Check with your licenced tax professional to be sure that you qualify.
Q: What’s a solar renewable energy certificate (SREC)?
Solar renewable energy certificates or SRECs show that a certain amount of electricity was produced using solar energy. They are typically used in conjunction with New Jersey's renewable energy standards (also called renewable portfolio standards or RPS) to show that regulated entities are meeting their solar energy goals.
In New Jersey’s RPS rules, an SREC is issued once a solar facility has generated 1,000 kWh (1MWh) through actual metered production. The SREC represents all the clean energy benefits of electricity generated from a solar electric system. SRECs can be sold or traded separately from the power, thus providing solar system owners a source of revenue to help offset the cost of the solar panel installation. Read More
Q: Are solar renewable energy certificates (SRECs) Taxable in NJ?
We are not in a position to provide tax advice and we always recommend that clients should consult their tax advisors when it comes to making tax related decisions, but you can click here to see some information provided by a New Jersey CPA along with the supporting IRS documenting the following "You can exclude from gross income any subsidy provided, either directly or indirectly, by public utilities for the purchase or installation of an energy conservation measure for a dwelling unit.”
Q: What’s a transition renewable energy certificate (TREC)?
In June 2018, the state decided to phase out SRECs in favor of a new, yet-to-be-established successor solar program. In an effort to bridge the gap between SRECs and the next phase of solar incentives, NJ implemented a transition solar incentive, known as TRECs.
Transition Renewable Energy Certificates (TRECs) are now created in New Jersey to provide incentives for all solar systems certified under the current Transition Incentive (TI) Program. This platform allows homeowners and aggregators to obtain payments from the electric utilities in NJ for generation reported to GATS. Read More
Q: Can I get credit for producing my own electricity in New Jersey?
Yes. The energy that is produced by a solar panel system will first serve a home's electrical load. Then, if the solar panel system produces more electricity than the home needs at any given time, your utility credits the excess electricity at the same price you would pay for electricity from the utility - in effect turning the electrical meter backwards. This is called "Net Metering," and the credit will appear on the monthly utility bill. Should the home need more energy than the solar panel system is producing at any given time, the customer can be assured that the utility will provide the electricity that the home needs. Often, homeowners find that they receive credits during expensive peak daytime hours, and then use more utility power during less expensive evening hours.
Q: What is Net Metering?
Net Metering is the policy that allows you to sell excess electricity back to the grid at the retail rate. This is great because the retail rate of NJ net metering is significantly higher than the wholesale rate that large power plants receive for the electricity they sell to the utility. Additionally, the ability to both buy and sell electricity from the grid allows you to balance your consumption and production, instead of letting any excess electricity you produce go to waste.
Check out the top utility net metering programs in New Jersey:
- Jersey Central Power & Light (JCP&L)
- Public Service Electric & Gas (PSE&G)
- Atlantic City Electric (ACE)
Q. When is my anniversary date (What is my PTO date)?
Your anniversary date is the date your system received approval to operate from the electric utility. If you have solar credits at your anniversary date, the electric utility will pay you a price specified by them (typically wholesale rates). At that point, your energy credits reset to zero.
Q. Can I change the anniversary date of my permission to operate (PTO) or interconnection date?
Yes. Your utility company will allow a one-time change to your anniversary date. Remember, if you have solar credits banked, this is when the utility company will pay you for the excess generation. If you have excess generation during the summer months, you want to be able to carry those credits into the fall and winter months to help offset your bills when your solar system is producing less energy. In general, we suggest that you set your anniversary date to the end of March. If you have electric heat or non-typical usage, your electric utility may recommend a different month.
Q: What Are The Best Solar Panels?
Our clients are faced with a wide variety of choices from the size of the panels (watts), to efficiency ratings, to the material they are made from (Monocrystalline, Polycrystalline or Thin Film), to their warranty, to where the solar panels are made. We currently only use Monocrystalline silicon panels for residential solar panel installations because of their even coloring and uniform appearance. This high-purity silicon is made of single-crystal wafer cells cut from cylindrical crystal slabs. The deep blue color of the panels is because they are made from a single continuous ingot. While they cost more than other types of silicon, they are also the most efficient, producing more power per square foot than other types.
We work with each of our client's to determine the best solar panels for their application. Many factors impact this decision including: your current energy usage, the amount of energy you want from solar, the size of your roof, the angle and pitch of your roof, the amount of irradiation your roof receives from the Sun. your warranty preferences, and your budget. Read More
Q: What is the lifespan of a solar panel system?
Solar panel systems last a long time depending on the amount of active use, or the amount of sunshine converted into electricity by the solar panels. Most systems are only in use for 6 to 8 hours per day. Manufacturers will usually provide from 10 to 20 year materials warranties (and 25 year production warranties) for the solar panels, and a 5 to 10-year warranty on the balance of system components. EnPhase provides a 25 year warranty on their micro-inverters. Solar panels have been reported to last 30 to 40 years.
Q: Can I install solar in a gated community or adult community in New Jersey?
According to the ACT (C.45:22A-48.2) approved August 21, 2007, an association cannot restrict you from installing solar on your roof, so long as you own and are responsible for maintaining the roof. Please e-mail us at firstname.lastname@example.org to request a copy of this ACT.
Q: What is the environmental impact if I use solar power at my NJ home?
As a general rule of thumb, studies indicate that the typical New Jersey home using solar power has an environmental impact of removing two cars from the road. Over 25 years, you will have avoided producing more than 500 tons of greenhouse gas emissions. Using solar electricity to power a million homes would reduce greenhouse gas emissions by 4.3 million tons per year, the equivalent of removing 850,000 cars from the road (Source: EPA).
Solar panels have received attention from researchers, businesses and homeowners because, unlike traditional power generation sources, these technologies produce electricity using a renewable source, the sun, without creating noise, emitting pollutants that cause climate change such as greenhouse gases, smog, acid rain, or water resource pollution. Even when the emissions related to solar cell manufacturing are counted, solar panels produce less than 15% of the carbon dioxide from a conventional coal-fired power plant.
Q: Does solar replace an electric utility in New Jersey?
Solar panel systems are typically used as either stand-alone systems or grid-connected systems. The role of solar panels in these two types of systems is very different, and the design decisions and performance requirements are very different as well. Stand-alone solar panel systems generate all of the on-site electricity needs of a home. Therefore, they are not connected to any electric utility. Stand-alone systems can provide AC or DC electricity, and typically include batteries to store electricity for use when the sun is not shining. Stand-alone systems are often cost-effective when installed in remote areas where access by electric utilities is difficult and expensive. Grid-connected solar panel systems are typically sized to meet at least 50% of a home's electrical load. These systems are not always sized to meet all of the electricity loads of a house because of the higher up-front costs associated with purchasing a larger system. Solar panel systems can be easily integrated with a utility's electrical grid to provide clean, renewable electricity for homeowners, while still ensuring continuous power supply from your regular utility.
Q: Does solar work if the power goes out?
Solar panel systems cannot power your house during a power outage unless you install some form of energy storage (an expensive battery back up system). There are two reasons that ordinary grid-tied solar will not work during a grid failure. The first is a technical reason and the second is a safety and regulatory issue.
The electronics that control a solar electric system constantly adjust voltage and current in order to keep the panels operating at their most efficient and powerful operating point through a range of varying sunlight conditions. To do this, the system needs to be able to produce quantities of power that are not dependent on how much your house is actually using at the time.
The second reason that solar shuts down during a blackout is safety. During a power outage, the power utility sends out repair crews to find and fix the points of failure. The linemen and women can be jeopardized if there is a solar array leaking power onto the grid lines. Therefore, utility rules mandate that in the event of a power outage, solar arrays must automatically shut down. Solar systems have detectors that sense whether power is coming across the grid, and whenever grid power is down, they automatically shut down too, to protect utility workers.
Q: What is involved in maintaining and operating a solar panels in New Jersey?
Minimal maintenance is required of the homeowner. But don't worry, Green Sun Energy Services does all the work! We even clean the panels of any debris such as fallen leaves and pollen.
Q: What happens to solar panels when it’s cloudy or raining in New Jersey?
Photovoltaic panels can use direct or indirect sunlight to generate power, though they are most effective in direct sunlight. Solar panels will still work even when the light is reflected or partially blocked by clouds.
Q: What is “free solar” all about?
If you’ve been researching solar panel system, you’ve probably heard at least one company advertise ‘free solar panels’ or seen ads that start with "U.S. Government Pays Middle Class Families to Go Solar" or "New Jersey will pay you to install solar" --- These ads are typically lead capture scams to sell your information to solar leasing companies!
Here's the deal: There is no such thing as a free lunch (or a free solar panel installation). Free solar panels’ are not actually free; you will pay for the electricity that they produce, usually under a 20 to 25 year solar lease or power purchase agreement (PPA). Read More
Q: What happens when I sell my house with solar in New Jersey?
When you purchase and own your system, your solar investment should increase the value of your house. The Appraisal Journal (October 1999), suggests that appraisers should increase the property value of a home with energy improvements by $20 for every $1 of annual energy savings.
When you sell your home, the Solar Installation is seen as a fixture on your house and is typically sold with the house. If you have an outstanding Home Equity Loan or Line of Credit, this will be closed out when you close on the sale of your home. SRECs if any are normally transferred to the new homeowner, but you can negotiate an assignment agreement with the buyer, whereby you retain ownership of the SRECs.
Q: What if my house isn't right for Solar?
Even if your house doesn't qualify for a solar system, there are still a lot of things that you can do to reduce your energy bill. For starters, please visit our Energy Saving Tips page for an extensive list of energy savings ideas that really work.
Q: How Do I Select The Best Solar Installation Company?
Choosing the best solar installation company can be one of the most challenging parts of your solar buying process. While solar panels and equipment can be classified by product specification, and different financing options have costs and benefits that can be compared, verified solar company reviews with standard metrics to evaluate solar panel installers can be difficult to find. Read More