By Solar Expert
February 23, 2026
Going solar is one of the smartest investments a New Jersey homeowner can make, but the first post-installation electric bill catches many people off guard. If you want to estimate your electric bill after solar before you sign a contract, you need a clear, step-by-step method that accounts for how utility billing actually works. This 5-step solar savings formula gives you a practical way to project your new monthly costs so you can make a confident decision based on real numbers, not sales projections.
What You'll Learn
Many homeowners walk into a solar installation expecting their electric bill to disappear entirely. When the first statement arrives and still shows charges, the surprise can feel like something went wrong. In most cases, nothing is broken. The issue is a gap between the sales pitch and how utility billing actually works.
Your electric bill is made up of several line items, not just one charge for the electricity you consume. Supply charges cover the cost of the energy itself, and these are the charges that solar production directly offsets. But delivery fees, fixed customer charges, societal benefits charges, and non-bypassable charges are billed based on your connection to the grid. Solar panels do not eliminate these costs.
A realistic expectation looks like this: a well-sized solar system can dramatically reduce or eliminate the supply portion of your bill, but you will still see a monthly statement with fixed and delivery charges. Understanding this upfront is what separates a satisfied solar homeowner from a frustrated one.
Claim: Your electric bill will not drop to zero after installing solar panels, even if your system covers all of your energy usage.
Evidence: New Jersey utilities charge fixed customer charges, delivery fees, societal benefits charges, and non-bypassable charges that appear on every bill regardless of how much solar energy you produce. These line items typically remain even when your net energy consumption reads zero.
The foundation of any accurate solar savings estimate is your actual electricity usage over a full year. A single month's bill or an annual average hides the seasonal peaks and valleys that directly affect how your solar system performs and how net metering credits accumulate.
Start by logging into your utility account portal. If you are a JCP&L customer, PSE&G customer, or served by another New Jersey utility, you can typically download or view 12 months of billing history online. Look for the usage section that shows kilowatt-hours (kWh) consumed each month.
While you are reviewing each bill, record three key numbers for every month: total kWh consumed, the supply charges (the per-kWh cost of the electricity itself), and the delivery charges (the per-kWh cost for moving that electricity to your home). These two charge categories behave very differently once solar panels are producing energy, so tracking them separately is important.
Claim: Using a full 12 months of utility data gives you a far more accurate solar estimate than looking at a single month or an annual average.
Evidence: Electricity consumption in New Jersey varies significantly between summer (air conditioning loads) and winter (heating and shorter days). A single month or flat average hides the peaks and valleys that directly affect how much solar production you need and how net metering credits accumulate across seasons.
With 12 months of billing data in hand, the next step is straightforward. Add up the kWh from each month to get your total annual consumption. This is the number your solar installer will use as the baseline for system sizing.
For example, if your monthly usage ranges from a low of 500 kWh in spring to a high of 1,200 kWh in summer, your annual total might land somewhere around 9,000 to 10,000 kWh. That total is the target your solar system needs to match or approach.
Here is the step most people miss: if you plan to add a major electrical load in the near future, factor it in now. An electric vehicle charger can add several thousand kWh per year to your household consumption, depending on how much you drive. A heat pump for heating and cooling or a new pool pump will also increase your baseline. Since adding panels after the initial installation requires a new permit and potentially a new interconnection agreement with the utility, it is more cost-effective to size for your anticipated future usage upfront.
Claim: If you plan to add an electric vehicle or heat pump within the next few years, you should factor that additional load into your solar system sizing today.
Evidence: Adding an EV charger can increase household electricity consumption by several thousand kWh per year depending on driving habits. Since solar panel systems are sized at installation and adding panels later requires a new permit and potentially a new interconnection agreement with the utility, it is more cost-effective to size for anticipated future loads upfront.
Now that you know how much electricity you use in a year, you need to find out how much a solar system on your specific roof can produce. This is where the estimate starts to depend on your property rather than general averages.
Professional installers use design tools like Aurora Solar or the free PVWatts calculator from the National Renewable Energy Laboratory to model expected annual kWh output. These tools factor in your roof angle, compass orientation, shading from trees or nearby structures, and local solar irradiance data for your area in New Jersey.
The key concept here is your solar offset percentage. This is simply your estimated annual solar production divided by your annual consumption, expressed as a percentage. If your system is projected to produce 9,500 kWh and you consume 10,000 kWh per year, your offset is 95 percent. Most installers recommend targeting an offset between 90 and 100 percent of your annual usage.
Keep in mind that roof orientation matters significantly. A south-facing roof with minimal shading will produce more energy per panel than an east- or west-facing roof. North-facing roofs are generally not recommended for solar in New Jersey's latitude. Shading from trees, chimneys, or neighboring buildings during key daylight hours can also reduce output, which is why a site-specific assessment is important.
Claim: A south-facing roof with minimal shading will produce meaningfully more energy per panel than a north-facing or heavily shaded roof in the same New Jersey neighborhood.
Evidence: Solar production depends on the angle of sunlight hitting the panels. In New Jersey's latitude, south-facing roofs receive the most direct sunlight throughout the year. Shading from trees or neighboring structures reduces output during affected hours. Installers model this with satellite imagery and shade analysis tools, and the difference between an ideal and a compromised roof can significantly affect the number of panels needed to reach the same offset.
This is where the formula starts turning your data into a real estimate. Take your solar offset percentage from Step 3 and apply it to the supply portion of your bill. The supply charges are the per-kWh cost of the electricity itself, and this is the portion that solar production and net metering credits directly reduce.
To calculate your offset percentage, divide your estimated annual solar production by your annual consumption. If your system is expected to produce 9,000 kWh and you consume 10,000 kWh, your offset is 90 percent. That means solar would cover roughly 90 percent of your supply charges over the course of the year.
Under New Jersey's net metering rules, this includes solar in Passaic, excess electricity your panels send to the grid during sunny months earns credits at the full retail rate for the supply component. These credits roll over month to month and offset supply charges during months when your panels produce less than you consume. However, delivery charges and fixed fees are billed based on your grid connection and usage patterns, not your net production. This is a critical distinction that many homeowners overlook.
In practical terms, your post-solar bill will still include delivery charges, fixed customer charges, and non-bypassable charges every single month. The supply side is where you see the savings.
Claim: Net metering in New Jersey lets you bank excess solar production as credits that offset future bills, but those credits apply only to the supply portion of your bill.
Evidence: Under New Jersey's net metering rules, excess electricity your panels send to the grid earns credits at the full retail rate for the supply component. However, delivery charges and fixed fees are billed based on grid connection and usage patterns, not net production. This means even a homeowner with a large credit bank will still see charges on every monthly statement.
Now it is time to put the full formula together. For each month, you will subtract your estimated solar production from your consumption, apply net metering credits for any surplus months, and add back the fixed charges that solar does not eliminate. The result is your projected post-solar electric bill, month by month.
Here is a seasonal pattern you can expect: during spring and summer, your panels will likely produce more energy than you consume, building up a bank of net metering credits. During fall and winter, shorter days and lower sun angles reduce production while heating-related electricity use may increase. Your credits from summer help offset winter bills, but the fixed charges remain constant throughout the year.
Follow this checklist to run your own month-by-month projection:
Claim: Most New Jersey solar homeowners see their lowest electric bills in spring and summer and their highest remaining charges in December and January.
Evidence: Solar panels produce the most energy during longer daylight months (May through August), often generating surplus credits. In winter, shorter days and lower sun angles reduce production while heating-related electricity use may increase. The result is a seasonal pattern where credits build up mid-year and get drawn down in winter, and the fixed charges become the dominant portion of the bill during high-production months.
One of the most helpful ways to understand your future electric bill is to see exactly which line items change after solar and which remain the same. The table below illustrates how a typical New Jersey utility bill breaks down before and after installing a solar system sized to offset most of your usage.
| Bill Line Item | Before Solar | After Solar (High Offset) |
|---|---|---|
| Supply charges (per-kWh energy cost) | Full amount based on usage | Reduced or eliminated by solar production and net metering credits |
| Delivery charges (per-kWh grid fees) | Full amount based on usage | Mostly unchanged; billed based on grid connection |
| Fixed customer charge | Monthly flat fee | Unchanged; charged for grid access regardless of solar |
| Non-bypassable charges (societal benefits, etc.) | Small per-kWh or flat charges | Unchanged; these remain on every bill |
| Solar net metering credit | N/A | Credits appear when production exceeds consumption; offsets future supply charges |
| Estimated total monthly bill | Full utility rate applied to all usage | Significantly reduced; primarily fixed and delivery charges remain |
The most common surprise on the first post-solar bill is the delivery charge. Homeowners who expected a near-zero bill often do not realize that delivery fees cover grid maintenance and infrastructure costs that are independent of how much energy your panels produce. These charges vary by utility, but they are a standard part of every New Jersey electric bill.
Another common surprise is the timing of credits. Net metering credits earned during sunny months may not appear as a simple dollar amount on your bill. Instead, they show up as kWh credits that roll forward. Understanding how your specific utility displays these credits on your statement helps you verify that the system is performing as expected.
Claim: Delivery charges and fixed fees can make up the majority of your post-solar electric bill even when your panels cover all of your energy usage.
Evidence: New Jersey utilities structure bills with separate supply and delivery components. Solar production and net metering credits offset the supply side. The delivery side -- which covers grid maintenance, infrastructure, and regulatory charges -- is billed based on your connection to the grid and is largely unaffected by how much solar energy you produce. Homeowners who expect a zero bill are often surprised that these charges persist.
Almost never. Fixed charges, delivery fees, and non-bypassable charges remain on every bill. Solar offsets the supply (energy) portion, but the utility still charges for grid access and infrastructure. Most homeowners with a well-sized system see a dramatically reduced bill, but not a zero one.
Excess solar energy sent to the grid earns credits at the full retail supply rate. Credits roll over month to month and offset future supply charges. At the end of the annual billing period, remaining credits may be paid out at a lower wholesale rate depending on your utility.
Most installers recommend sizing a system to offset 90 to 100 percent of your annual usage. Going above 100 percent is generally not financially beneficial under New Jersey net metering rules because excess annual credits are compensated at a lower rate.
Estimates from reputable installers who use satellite-based design tools and your actual utility bills are generally reliable. Be cautious of estimates based on assumptions rather than your real usage data. Ask whether the estimate accounts for fixed charges and delivery fees, not just the supply portion.
Yes. South-facing roofs produce the most energy in New Jersey. East- and west-facing roofs produce less but can still be viable for solar. North-facing roofs are generally not recommended for solar at this latitude because they receive significantly less direct sunlight.
If utility rates increase, your savings increase proportionally because each kWh your panels produce displaces a more expensive kWh from the grid. This is one reason solar is often described as a hedge against rising energy costs.
You can get a rough estimate using the 5-step formula in this article plus free tools like PVWatts. However, a professional site assessment accounts for your specific roof geometry, shading, and rate plan, giving a more precise projection than any DIY calculation.
Claim: Following a structured 5-step formula that separates supply charges from fixed fees gives homeowners a more realistic post-solar bill estimate than relying on a single savings percentage.
Evidence: Generic savings estimates often focus only on total kWh offset without distinguishing between supply and delivery charges. Because delivery fees and fixed charges persist regardless of solar production, homeowners who use a line-item approach -- separating what solar offsets from what it does not -- consistently arrive at more accurate projections and avoid the common disappointment of expecting a zero bill.
You now have a practical 5-step formula to estimate your electric bill after solar: gather 12 months of utility data, calculate your annual consumption, estimate your system's production, apply the offset to your bill, and project your new monthly costs. This approach gives you a realistic baseline that accounts for the charges solar eliminates and the ones it does not.
For a more precise estimate tailored to your specific roof, shading, and utility rate plan, a professional site assessment is the next step. Online calculators use generalized assumptions, but an on-site evaluation uses satellite imagery, shade analysis tools, and your actual rate schedule to model production and savings for your property.
Powerlutions provides detailed, site-specific solar production estimates and bill projections for New Jersey homeowners. Contact us to run the numbers for your home and see exactly what your post-solar electric bill will look like.
Claim: A professional site assessment will give you a more precise savings estimate than any online calculator because it accounts for your specific roof geometry, shading, and utility rate plan.
Evidence: Online calculators use generalized assumptions about roof orientation, shading, and electricity rates. A professional assessment uses satellite imagery, shade analysis tools, and your actual utility rate schedule to model production and savings for your specific property. This is why installer-provided estimates are typically more accurate than DIY calculations.
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