Under N.J.A.C. 18:24-26.4 the purchaser of a solar energy device or system must issue to the seller an Exempt Use Certificate, Form ST-4, or other approved form. The certificate should indicate on its face that the purchase qualifies for exemption as a solar energy system.
The purchaser must also insert the address of the property upon which the solar energy device or system will be installed. So the exemption attaches to a specific installation address, which matters if you own more than one property or if the billing address differs from where the system is going.
The practical point is the timing. This is not a credit claimed on a return months later, it is a certificate given to a seller as part of the transaction. Ask your installer how they handle it, and ask to see that it was issued rather than accepting an assurance that the price already reflects it.
Check the quote itself while you are at it. If a quote shows sales tax as a line item, ask why, because that is a question with a good answer or a very useful one.
The property tax exemption is a separate filing later
New Jersey has a second exemption that works nothing like the first. Qualifying renewable energy systems are exempt from real property taxation under N.J.S.A. 54:4-3.113a to g, and the annual exemption is the difference between the total assessed value of the property before and after installation.
That one is claimed after the system is in, and it is not automatic. Form CRES, the Certification of Renewable Energy System, must be filed with your local municipal tax assessor, and the system must be certified by the local construction code official.
So the sequence across a project is: Form ST-4 with the seller at purchase, then Form CRES with the assessor once the system is installed and certified. Two exemptions, two procedures, two points in time, and both easy to miss because neither arrives as a cheque.
Write both on a list at the start of the project. That is genuinely all it takes, and it is the difference between receiving what New Jersey offers and receiving most of it.
What the system earns once it is running
New Jersey provides full retail net metering, so you receive full retail credit on your utility bill for each kilowatt hour your system produces over the course of a year. The credit comes either through directly offsetting electricity delivered by the grid, or through a credit applied by the electric distribution company after a month of net excess generation.
On top of that, the Administratively Determined Incentive pays on generation. One SREC-II is created when a system generates 1,000 kilowatt hours of electricity, and the incentive is guaranteed for a term of 15 years.
Those two streams need two meters. New Jersey's Clean Energy Program states that the metering used for netting and crediting cannot measure gross generation for REC or SREC creation, and that relying on one meter for both would leave the customer-generator short changed. Confirm a production meter is included in your installation.
Ask your installer to show the bill savings and the incentive income separately in any projection, rather than as one combined figure. They behave differently, they last for different periods, and you should be able to see each on its own.
Two exemptions, and only one of them happens by itself
New Jersey exempts solar energy equipment from state sales tax, but the exemption has a procedure. Under N.J.A.C. 18:24-26.4 the purchaser must issue to the seller an Exempt Use Certificate, Form ST-4, or other approved form. The certificate should indicate on its face that the purchase qualifies for exemption as a solar energy system, and the purchaser must insert the address of the property where the system will be installed.
Note that this happens at the point of purchase, with the seller, rather than being claimed back afterwards on a return. Ask your installer how they handle it and confirm the certificate has been issued rather than assuming the price you were quoted already reflects it.
The property tax exemption is separate and is not automatic either. Qualifying renewable energy systems are exempt from real property taxation under N.J.S.A. 54:4-3.113a to g, but Form CRES, the Certification of Renewable Energy System, must be filed with your local municipal tax assessor, and the system must be certified by the local construction code official.
The annual exemption is the difference between the total assessed value of the property before and after the system has been installed. Nobody files Form CRES on your behalf by default, so ask whether your installer assists, and put it on your own list either way. An exemption you qualified for and never claimed is the most avoidable cost in a New Jersey solar project.