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NJ solar customers are safe from energy rate hikes. Trump’s tax bill could change that.
By
Mike Hayes
Published Jun 16, 2025
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Najlah Feanny/Corbis via Getty Images
By
Mike Hayes
Published Jun 16, 2025
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In an age of surging utility bills, one group has largely escaped the pain of recent rate hikes: Solar energy customers not only harness the sun's rays to power their homes, the vast majority are putting more energy back into the grid than they actually use, offsetting the financial burden that others face.
President Donald Trump’s “big, beautiful bill” could put an end to that.
Electricity bills in parts of New Jersey went up as much as 20% at the start of June. In New York, utility customers' bills could go up 11% this summer. A provision in Trump’s budget bill could upend the solar industry, according to installers and industry experts, taking residents' ability to avoid rising energy costs with it. The legislation moving through Congress does away with the tax credits that many homeowners and solar companies rely on to keep monthly prices low.
Lyle Rawlings, president and CEO of New Jersey-based commercial solar installation firm Advanced Solar Products, said that if Trump's bill is passed, it would lead to future rate hikes for all energy payers and would hit the solar industry hard. He added that the mood within solar companies is somber.
“A lot of them are laying off already and shrinking their companies and wondering whether they're gonna survive,” he said.
The bill would specifically eliminate a 30% tax credit for homeowners that install solar panels. That would also apply to solar leasing companies that charge homeowners a monthly fee for their panels.
Rawlings said the current bill's provisions are not retroactive and homeowners who already installed solar wouldn’t face changes to their contracts. The legislation would apply to the installation of any solar system completed after December 2025.
Doug O’Malley, director of the advocacy group Environment New Jersey, said the bill could cause a “drastic slowdown” in the state's solar growth.
“There's predictions that the solar market could decrease its growth by up to 40%,” he said, citing energy research firm Wood MacKenzie.
Rate hike blame game
PJM — the marketplace that sets prices for energy in New Jersey, plus 12 other states and Washington, D.C. — broke the news of a rate hike to utility payers earlier this year. The increase went into effect at the start of June. The company said future demand for energy was outstripping supply. At a legislative hearing earlier this year, PJM officials blamed a “proliferation of data centers,” increased electrification of homes and vehicles and “the onshoring of the U.S. manufacturing industry.”
In New York, Con Edison announced last month that residents' bills would increase by approximately 2.7% in the coming months, making the average bill $141. The company said commercial and business customers would see even larger increases.
In New Jersey, the rate hikes set off a political firestorm. In April, Gov. Phil Murphy sent a letter to the Federal Energy Regulatory Commission accusing PJM of market manipulation.
Clean energy advocates have also pushed back, noting that 95% of energy projects waiting in the queue to come online are for renewables and blaming PJM for being slow to act.
“ The backlog of projects, most of them are solar and storage that are supposed to be getting on the grid that haven't been able to connect,” said Drew Tompkins, director of advocacy and policy for the Jersey Renews Coalition.
Most home solar customers produce more electricity than they need to power their home in a given month. That excess electricity is then sent back onto the grid through a process called net metering. Solar customers then bank energy credits to use during, nighttime hours and cloudier months. But when home solar systems are humming, there’s no need for customers to tap into the grid.
The House passed Trump’s bill in May. It’s currently being debated in the Senate. Elowyn Corby, Mid-Atlantic regional director for nonprofit advocacy group Vote Solar, said negotiations around the solar tax incentives are underway.
“We are optimistic that the final legislation will look much better than what we've seen so far,” she said.
Rawlings said he’s heard moderate Senate Republicans show support for continuing the incentive program.
“ It's a matter of whether they'll grow a spine and stand up for what they really want,” he said.
Meanwhile, the Murphy administration says it's committed to giving every resident and business in the state access to solar energy.
“New Jersey will continue to be a leader on solar energy generation to provide our residents with clean, affordable and local energy, regardless of who controls the federal government,” said Eric Miller, director of the Governor’s Office of Climate Action and the Green Economy.
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Mike Hayes
Mike Hayes covers equity and access to opportunity in New Jersey. He joined WNYC and Gothamist in 2023. Before that, he worked as a freelance journalist writing about policing and criminal justice. He has written for ProPublica, CNN, HuffPost, BuzzFeed News and The Appeal. He is also the author of the book, “The Secret Files: Bill De Blasio, The NYPD, and the Broken Promises of Police Reform.” In 2019, he was a finalist for the Livingston Award for Young Journalists.
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Gothamist is funded by sponsors and member donations
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