25-year savings projection for New Jersey
This projection starts from New Jersey's assumed $0.19/kWh electricity rate and 1,260 kWh/kW of annual production, then grows savings by 3% a year as electricity prices rise and reduces output by 0.5% a year as panels degrade.
| Year | Annual savings | Cumulative savings | vs. $24,400 cost |
|---|---|---|---|
| Year 1 | $1,578 | $1,578 | −$22,822 |
| Year 5 | $1,741 | $8,293 | −$16,107 |
| Year 10 | $1,968 | $17,668 | −$6,732 |
| Year 15 | $2,225 | $28,268 | +$3,868 |
| Year 20 | $2,516 | $40,252 | +$15,852 |
| Year 25 | $2,844 | $53,801 | +$29,401 |
A simple, undiscounted projection — it does not apply a discount rate, financing interest, inverter replacement (commonly needed once in 25 years), maintenance, or any change in home value. Treat it as a shape, not a forecast. See methodology.
Why savings look like this in New Jersey
Retail net metering plus guaranteed incentive payments per megawatt-hour make New Jersey a consistently strong market.
The single biggest variable is what your utility pays for exported power. New Jersey requires full retail net metering with annual true-up at avoided cost — one of the strongest export policies in the country.
What would change this number
- Your actual rate. This uses a $0.19/kWh New Jersey average. If you pay more, savings scale up roughly proportionally.
- Self-consumption. We assume 68% of output is used on site at retail value and the rest exported at 45% of retail. Households home during the day, or with a battery, do better.
- Electricity price growth. At 3% a year, savings nearly double by year 25. Slower growth meaningfully reduces lifetime return.
- Incentives. New Jersey's main program — susi / srec-ii payments for 15 years — reduces net cost and shortens break-even. See New Jersey incentives →
- Financing. A cash purchase earns the return above. A loan shifts it — interest can consume a large share of lifetime savings.
Frequently asked questions
How much can you save with solar panels in New Jersey?
An 8 kW system in New Jersey could save roughly $1,578 in the first year — about $132 a month — and around $53,801 across 25 years, assuming electricity prices rise 3% a year and panel output declines 0.5% a year. Against a midpoint installed cost of $24,400, that is a net gain of about $29,401.
What is the ROI on solar panels in New Jersey?
On these assumptions, roughly 120% over a 25-year system life — $29,401 of net savings on a $24,400 system. That is a simple, undiscounted return: it ignores financing interest, the time value of money, and any effect on home resale value. A cash purchase and a loan produce very different numbers.
How long does it take for solar to pay for itself in New Jersey?
Around year 14, when cumulative savings first exceed the $24,400 installed cost. A simple payback that ignores rising electricity prices gives a wider range of 13–17 years.
Do solar savings in New Jersey include the federal tax credit?
No. The 30% federal residential clean energy credit (Section 25D) ended for systems installed after December 31, 2025, so none of these figures include it. Any savings projection you see elsewhere that still applies 30% to a 2026 purchase is overstating the return.
What most affects solar savings in New Jersey?
Three things, in order: your utility's export compensation (New Jersey requires full retail net metering with annual true-up at avoided cost — one of the strongest export policies in the country.), how much of the output your household consumes on site rather than exporting, and your actual electricity rate versus the 0.19/kWh state assumption used here. SuSI / SREC-II payments for 15 years can improve the result further.
Where these numbers come from
State assumptions are informed by public data and reviewed periodically (September 2026):