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Get a Free QuoteWith the federal residential tax credit dead and NJ’s ADI program paying $85–$95/MWh for 15 years, who owns the system matters more than ever. Here’s a data-driven breakdown.
For most New Jersey homeowners in 2026, owning your system through a local installer saves $15,000–$22,000 over 25 yearscompared to a Sunrun lease/PPA. The biggest reason: you keep NJ’s ADI payments ($1,200–$1,400/year for 15 years) instead of handing them to Sunrun. Ownership also means no escalator clauses and a cleaner home sale.
Based on a typical 8 kW system in New Jersey producing ~9,600 kWh/year.
| Factor | Sunrun Lease/PPA | Local Installer (Own) |
|---|---|---|
| Upfront cost | $0 down | $2.85-$3.15/W ($22,800-$25,200) |
| Effective $/kWh | $0.16-$0.20/kWh (escalates) | $0.06-$0.10/kWh (fixed) |
| 25-year total cost | $38,000-$48,000 | $25,000-$31,000 (incl. loan interest) |
| System ownership | Sunrun owns | You own |
| ADI revenue (15 yr) | Sunrun keeps (~$18K-$21K) | You keep (~$18K-$21K) |
| Federal ITC (25D) | Dead — $0 for homeowners | Dead — $0 for homeowners |
| Section 48E ITC | Sunrun claims (you get nothing) | N/A — homeowner purchase |
| NJ sales tax exemption | Yes | Yes |
| NJ property tax exempt | Yes (Sunrun-owned) | Yes (you benefit directly) |
| Escalator clause | 1.5-2.9%/year | None — fixed loan or $0 if cash |
| Home sale impact | Lease transfer required | Adds home value |
| Roof warranty risk | Sunrun handles | Installer warranty (25 yr typical) |
New Jersey still has some of the strongest state-level solar incentives in the country. But most of them only benefit the system owner.
NJ’s Administratively Determined Incentive (ADI) pays $85.00/MWh in EY2025-26, rising to $85.00/MWh. For a typical 8 kW system, that’s $1,200–$1,400/year for 15 years— roughly $18,000–$21,000 total. With Sunrun, they keep every dollar.
NJ offers full 1:1 retail net metering at ~$0.26/kWh. Excess energy you export credits your bill at the same rate you pay. Both Sunrun and owned systems benefit, but owners capture the full savings directly.
Solar equipment is exempt from NJ’s 6.625% sales tax. On a $24,000 system, that saves you ~$1,590upfront. With a Sunrun lease, this exemption benefits Sunrun’s purchase cost, not your payments.
NJ provides 100% property tax exemption on solar installations. Your home value increases without higher property taxes. This applies to both owned and leased systems, but owned systems add directly to your equity.
This is the single most important number in the NJ Sunrun vs local installer debate. NJ’s ADI program pays the system ownera fixed rate per megawatt-hour for 15 years. When Sunrun owns your system, they collect this income — not you.
ADI Rate
$85.00
per MWh
Annual ADI Income
~$1,370
8 kW system
15-Year Total
~$20,500
forfeited to Sunrun
That $20,500 in ADI revenue alone nearly covers the cost of buying your own system. When you add utility bill savings on top, owned solar in NJ pays for itself in roughly 8–10 years— then generates pure profit for the remaining 15+ years of the system’s life.
Sunrun PPAs typically include a 1.5–2.9% annual price escalator. Here’s what that looks like over 25 years for an 8 kW NJ system.
Year 1 PPA Cost
$0.18/kWh
~$1,728/year
Year 10 (2.9% esc.)
$0.24/kWh
~$2,304/year
Year 25 (2.9% esc.)
$0.36/kWh
~$3,456/year — above grid rate
The crossover problem
With a 2.9% annual escalator, your Sunrun PPA rate surpasses NJ’s current grid rate (~$0.26/kWh) by year 14–16. At that point, you’re paying morefor solar than you would for grid electricity — locked in for the remaining 9–11 years of your contract. With ownership, your cost per kWh is fixed at $0.06–$0.10 and never increases.
To be fair, there are narrow scenarios where a Sunrun lease could be reasonable:
Even in these cases, compare the 25-year total cost carefully. A $0-down solar loan often beats a Sunrun PPA because you still own the system and keep all ADI revenue.
NJ's ADI program pays system owners $85-$95/MWh for 15 years. That's $1,200-$1,400/year you keep instead of giving to Sunrun.
Cash purchase = $0 monthly. Loan = fixed payment that never increases. Either way, no surprise rate hikes.
Owned solar adds $15K-$20K in home value per Zillow data. No lease transfer headaches for buyers.
Total cost of $25K-$31K for ownership vs $38K-$48K for a Sunrun PPA. That gap widens with higher escalator rates.
Yes. Sunrun operates in New Jersey offering solar leases and PPAs. However, under a Sunrun agreement, Sunrun owns the system and keeps all SREC-II/ADI revenue — worth $1,200-$1,400 per year for a typical 8 kW system.
No. Under a Sunrun lease or PPA, Sunrun owns the system and keeps the ADI income. Only system owners receive ADI payments. With a local installer and cash or loan purchase, you keep all $85-$95/MWh in ADI revenue for 15 years.
A typical Sunrun PPA in New Jersey starts at $0.16-$0.20/kWh with a 1.5-2.9% annual escalator. Over 25 years, total payments typically reach $38,000-$48,000 for an 8 kW system. Ownership with a local installer costs $25,000-$31,000 total (including loan interest), and you keep ADI revenue on top of that.
No. The Section 25D residential solar tax credit expired on December 31, 2025. Homeowners who purchase solar in 2026 receive $0 in federal tax credits. Third-party owners like Sunrun can still claim the Section 48E commercial ITC on systems they own — but that benefit stays with Sunrun, not you.
Yes, but buyout pricing is set by Sunrun and often exceeds fair market value. Many NJ homeowners report buyout quotes of $15,000-$25,000 after already paying years of lease payments. This makes it difficult to recoup your total investment.
You must either transfer the lease to the buyer (who must qualify) or buy out the remaining contract. Many NJ real estate agents report that Sunrun leases can complicate home sales, as buyers may not want to assume the obligation.
See your system size, cost, ADI income projection, and payback timeline. Compare cash, loan, and third-party options side by side.