Net metering and interconnection are two related but different processes: one determines how solar generation appears on your bill, and the other determines whether and when the utility permits the system to operate.
How bill credits work
Eligible New Jersey customer-generators can receive full-retail bill credits for production up to total annualized electricity use. Excess credits carry forward within the annualized period. Fixed charges and other non-energy items may remain on the bill. NJ solar market FAQs
What happens at annual true-up?
At the end of the annualized period, any remaining excess credit is valued at the utility’s avoided wholesale cost, not the full retail price. This is one reason a system should be sized to household energy use rather than simply filling every roof plane.
Sizing around household use
The usual net-metering eligibility rule limits generating capacity against annual electric consumption. Recent bills, potential EV or heat-pump additions, roof condition and shade should all be considered in a site-specific design. Program sizing guidance
Updated interconnection screens
The January 2026 adopted NJBPU rule broadened Level 1 review for qualifying smart-inverter systems to facilities of 50 kW AC nameplate or less and 25 kW export capacity or less, while retaining other technical screens. Projects outside Level 1 may enter Level 2 or Level 3 review. Approval time depends on application completeness and the local grid, so older generic week ranges should not be treated as guarantees. Current adopted rule
Frequently asked questions
Does a solar system erase the entire utility bill?
Not necessarily. Fixed charges, seasonal production, annual reconciliation and energy use can leave a balance.
What happens to unused credits at year end?
Remaining annualized-period credits are reconciled at the utility’s avoided wholesale cost, rather than the full retail rate.
Can every rooftop system use Level 1 review?
No. A project must meet the current Level 1 size and technical screens; otherwise a different review process may apply.
Eligibility, rates, utility practices and contract terms can change. Review current official material and obtain qualified legal, tax or financial advice where relevant.
