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| Will my SREC floor price decline over time?
What is the PSE&G Solar Loan Program?
Why did PSE&G initiate the Solar Loan Program?
Who is eligible to participate?
Who is eligible for net metering?
How will Net Metering affect my PSE&G electric bill?
What are the program benefits for residential customers?
What is the size and cost of a typical residential solar electric system, and how much will I save?
How does the residential PSE&G Solar Loan Program work?
What exactly is a Solar Renewable Energy Certificate (SREC)?
What advantages does the Solar Loan Program have over a bank loan?
When do SRECs start accumulating?
How will PSE&G track my SREC repayments?
What is the loan interest rate?
How long is the loan repayment period?
How much of my solar electric system’s cost will the PSE&G loan cover?
When will I receive the money I am borrowing under the loan program?
Will PSE&G give me a commitment for my loan?
How will I know that my system will produce sufficient SRECs to repay my loan?
What if my system doesn’t perform as well as predicted?
If the value of an SREC climbs higher than my floor price, can my loan be repaid in less than 10 years?
What other incentives are available for solar installations?
Are PSE&G Solar Loan Program participants eligible for rebates through New Jersey’s Clean Energy Program?
What happens if I sell my house?
How does a residential solar electric system work?
How does net metering work?
What type of roof design is best for a solar power system?
Can my house have a solar electric system and still be connected to PSE&G?
Will my solar system operate if PSE&G experiences an electric outage?
Will my system work at night or on cloudy days?
So, how do I get started with solar power?
Where can I learn more about solar energy?
What if I have additional questions?
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No! Your SREC floor price depends on when your application is received. Once capacity is reserved for your project, and if your loan closes, your SREC floor price will be the same for the life of the loan. |
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PSE&G has committed to providing approximately $143 million toward financing solar electric system installations over the next two years under Solar Loan Program II. Solar Loan Program II allows residential solar systems to be installed “behind the meter” using PSE&G as an essential source of capital. |
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| By the year 2020, New Jersey’s draft Energy Master Plan seeks to reduce projected energy use by 20%, while meeting 20% of the State’s electricity needs with Class 1 renewable energy sources, such as solar energy. Solar energy is a clean, renewable energy source. However, due to its high up-front costs, new financing programs are needed to help customers pay for solar electric system installations.
As New Jersey’s largest utility, PSE&G is uniquely positioned to provide the capital resources to help support the State’s renewable energy goals, slow global warming, and reduce our dependence on foreign oil. |
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| Who is eligible to participate? |
| All PSE&G residential, business, municipal, and non-profit electric customers can take advantage of the PSE&G Solar Loan Program, provided they meet the minimum credit requirements. However, solar power systems must be installed within PSE&G’s electric service territory and must be eligible for net metering |
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| Who is eligible for net metering? |
| Net metering is available to residences that generate electricity on the customer side of the meter, using Class 1 renewable energy sources (such as solar). The capacity of the customer-generated facility must not exceed 2 megawatts (MW) or the customer’s historical annual electricity usage. |
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| How will Net Metering affect my PSE&G electric bill? |
| For more information on how Net Metering would affect your bill click here. |
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| What are the program benefits for residential customers? |
| PSE&G’s Solar Loan Program is a convenient way to finance part of your solar power system’s up-front investment. And, because solar electric systems generate years of clean, renewable energy, you’ll be doing your part to help the environment and fight global warming – while lowering your monthly electricity bills. |
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| What is the size and cost of a typical residential solar electric system, and how much will I save? |
| The average size of a residential solar system in New Jersey is 7 kilowatts (kW) at an average cost of $58,000. However, the size of your system depends on your home’s electricity needs. For this reason, you should first look for ways to reduce your energy consumption, such as installing high-efficiency appliances and adjusting the temperature on your thermostat. You should also take into account the cost of insurance or maintenance.
The amount of money you will save on your energy bill depends on many factors, such as the efficiency of your solar system. Your installer can review specific details with you.
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| How does the residential PSE&G Solar Loan Program work? |
| PSE&G will provide you with a loan to cover about 40% – 60% of the cost of installing a solar electric system on your home. You can repay your loan with Solar Renewable Energy Certificates (SRECs) earned from the electricity your system generates over a 10-year period. |
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| What exactly is a Solar Renewable Energy Certificate (SREC)? |
| An SREC is a clean energy credit issued in the form of a tradable certificate by the New Jersey Board of Public Utilities (BPU). Every time your solar power system generates 1,000 kilowatt hours (kWh) (or one megawatt hour [MWh]) of power, one SREC is earned and its value is applied to the balance of your loan. |
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| What advantages does the Solar Loan Program have over a bank loan? |
| Unlike bank loans, which can only be repaid in cash, loans from the PSE&G Solar Loan Program can be repaid using SRECs, and supplemented by cash if your system does not generate enough energy. PSE&G will value your SRECs at your corresponding floor price, or at market price, whichever is higher. However, you must be the owner of the solar panels, and PSE&G must have a first-priority security interest in the solar panels as loan collateral. |
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| When do SRECs start accumulating? |
| SRECs start accumulating on the day your solar electric system is connected to electric service. Your system must also pass an inspection by the BPU’s Office of Clean Energy, and you must establish an account under the BPU’s SREC Program. |
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| How will PSE&G track my SREC repayments? |
| PSE&G will track your SRECs through your system output meter, which will be read by PSE&G meter readers. Each time your system generates 1,000 kWh of electricity (equal to one SREC), PSE&G will transfer one SREC from your account toward repayment of the loan. Your electric usage will be tracked by a separate net meter. |
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| What is the loan interest rate? |
| The interest rate on a 10-year residential loan is 6.5%. |
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| How long is the loan repayment period? |
| The loan repayment period is 10 years. |
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| How much of my solar electric system’s cost will the PSE&G loan cover? |
| The PSE&G loan will cover about 40% – 60% of the cost of your system installation. The loan amount depends on the expected amount of energy that your system will produce. |
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| When will I receive the money I am borrowing under the loan program? |
| PSE&G will close the loan and disburse the proceeds after your solar system is installed, inspected, and registered to produce SRECs. |
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| Will PSE&G give me a commitment for my loan? |
| Yes. Once your project is approved, you will receive a loan commitment letter that is good for one year. The commitment will be rescinded if your system is not completed during this one-year timeframe. However, if the delay is caused by reasons beyond your control, the commitment may be extended an additional six months. |
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| How will I know that my system will produce sufficient SRECs to repay my loan? |
| Your contractor will use a software program to estimate the number of SRECs that will be generated over the life of your loan. Using this estimate, PSE&G will determine your loan repayment schedule based upon your SREC floor price. |
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| What if my system doesn’t perform as well as predicted? |
| If you fall behind on loan repayment through SRECs due to inadequate energy output by your system, PSE&G will require that you make cash payments to true-up the shortfall. This true-up will be performed annually to ensure that your account is current. Consult our residential loan documents for more details. |
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| If the value of an SREC climbs higher than my floor price, can my loan be repaid in less than 10 years? |
| Yes. However, PSE&G will retain the right to purchase the SREC output from your system. The price you receive from PSE&G will equal 75% of the current SREC market price. After the end of your 10-year loan period, you will have full rights to your SRECs. |
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| What other incentives are available for solar installations? |
| You may also be eligible for tax credits and incentives that may further offset the cost of your solar power installation. Ask your solar contractor/installer or tax advisor for details. |
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| Are PSE&G Solar Loan Program participants eligible for rebates through New Jersey’s Clean Energy Program? |
| Residential customers who participate in the PSE&G Solar Loan Program may apply for Clean Energy Program rebates, if available. Visit NJCleanEnergy.com for the latest rebate information. |
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| What happens if I sell my house? |
| Generally, your loan will be repaid at closing, and PSE&G will retain the right to purchase SRECs from the new owner for any remaining option period (10 years from loan closing). If, however, the new owner agrees to assume your loan obligation, the loan can be transferred, provided that the new owner meets all applicable credit criteria and pays any associated legal and administrative costs. |
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| How does a residential solar electric system work? |
A solar system converts sunlight directly into DC power through an array of solar cell modules mounted on your roof. An inverter converts this DC power into AC power that can be used in your home.
our solar system will be interconnected with PSE&G’s distribution system. If your solar system produces more electricity than your home is using, PSE&G will credit your utility account for the excess power being returned to the grid. This is called net metering.
PSE&G will continue to provide power as usual at night and during the day when your electricity demand exceeds that which is produced by your solar system.
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| How does net metering work? |
| Net metering measures the difference between the electricity you buy from your utility and the electricity you produce with your solar electric system. Your electric meter keeps track of this difference automatically. Under net metering, excess electricity produced by your solar electric system is delivered back into the utility grid, effectively spinning your meter backwards. Your meter spins forward when your solar electric system does not produce all of the electricity you are currently using. |
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| What type of roof design is best for a solar power system? |
| Solar photovoltaic panels work best when mounted on an unobstructed roof at an angle that captures the most sunlight. |
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| Can my house have a solar electric system and still be connected to PSE&G? |
| Yes. Solar power systems are designed to interconnect with utility power. |
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| Will my solar system operate if PSE&G experiences an electric outage? |
| In most cases, the solar system is shut down to protect utility workers as they restore power. However, some system designs include isolation circuitry that allows continued operation. |
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| Will my system work at night or on cloudy days? |
| Sunlight must be present for solar modules to produce power, so you will still need to draw power from your utility at night. Under a lightly overcast sky, solar panels typically produce about half as much electricity as they would under full sun. On cloudy days, the amount of electricity generated may decrease further. |
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| So, How do I get started with Solar Power? |
| The first step is to obtain proposals from several solar contractors/installers, and to check their references carefully.
Click here for a list of contractors/installers from the New Jersey Clean Energy Program Web site.
Once you have chosen your installer, the next step is to apply for financing from PSE&G. Click here for application instructions and forms, as well as copies of all loan documents.
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| Where can I learn more about solar energy? |
| Visit the U.S. Department of Energy Web |
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| What if I have additional questions? |
| For more information, download our Residential Solar Loan Brochure, email solarloan@pseg.com, or call the PSE&G Solar Loan Program at 973-430-8460.
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