If you live in New Jersey, you know that electricity bills are going up, and no one seems to have a good answer to the problem. Governor Mikie Sherrill declared a state of emergency and froze utility bills, but that’s not a long-term solution.
Wholesale power costs are soaring, and foreign conflicts, such as the war in Iran, continue to drive up fuel costs. Data centers have caused a massive surge in electricity demand across New Jersey. This has triggered a supply crunch and caused recent PJM capacity auctions to hit record-high price caps.
You don’t need to have a deep understanding of energy markets to know that this is a mess that won’t be easily solved. Right now, everyone wants power from a grid that was built before many people’s grandparents were born, which desperately needs repairs. It’s a perfect storm that’s likely going to get worse before it gets better.
On top of all of this, extreme storms and power outages now happen far more frequently in New Jersey than ever before. Home batteries are one of the best solutions to the high cost of energy and instability of our grid.
A battery can keep your lights, refrigerator, and Wi-Fi running when the power goes out. But modern home batteries do far more than keep the lights on in an emergency. They can also help you save money on your daily electric bills by letting you avoid buying power from the utility company when rates are at their highest.
Home batteries can be expensive to buy and install. That’s why the New Jersey Board of Public Utilities (NJBPU) is launching the Garden State Energy Storage Program (GSESP).
What is the Garden State Energy Storage Program (GSESP)?
New Jersey wants to build a massive battery network to strengthen the electric grid, prevent blackouts, and lower energy costs for everyone. The GSESP is their plan to do so.
Here are the goals of the program:
- Install 2,000 megawatts of energy storage (batteries) in New Jersey by 2030
- Make battery storage affordable for homeowners
- Stabilize and strengthen the electric grid
- Protect New Jerseyans from power outages
- Capture and save renewable energy for when it’s needed most
If you’re craving some context, 2,000 megawatts is enough power to run hundreds of thousands of homes at once!
The GSESP is designed to roll out in phases.
- Phase 1 (Transmission-Scale): This phase is for giant, industrial-sized battery projects built by professional developers. These batteries connect directly to the main high-voltage transmission lines of the power grid, so the energy they store will power the entire grid, not just homes.
- Phase 2 (Distributed): This phase helps pay for home and small-business batteries. These are smaller batteries, usually installed in your garage or on the side of your home or building.
Phase 1: Batteries Supporting the Grid
On March 4, 2026, the state officially approved the first round of awards (Tranche 1). The NJBPU reviewed 10 bids and approved incentives for 3 massive battery projects. Together, these projects will bring 355 megawatts of storage capacity to New Jersey.
The three winning projects are :
- Woods Landing Energy Storage: A 200 MW project in Northern New Jersey built by Jupiter Power.
- Two Rivers Energy Storage: A 150 MW project built by Elevate Renewables.
- North America Energy Storage Corp: A smaller 5 MW project in Central New Jersey.
On the exact same day, March 4, 2026, the state launched Tranche 2 of Phase 1. This new round is seeking bids for another 645 megawatts of battery projects.
The NJBPU expects these large-scale battery projects to save New Jersey utility customers over $169 million. They’ll dump cheap, stored power back onto the grid during busy, hot summer afternoons to keep wholesale electricity prices from spiking.
Phase 2: The Distributed Battery Program
This phase of the program is built for home and business owners. While we don’t yet have an exact release date, the program is expected to officially launch in mid 2026.
If you’re interested in reading through the New Jersey BPU’s official PDF on the program, you can find it here.
There are two ways that Phase 2 incentives will help New Jersey home and business owners pay for batteries:
- The Distributed Fixed Incentive, which is an upfront rebate
- The Distributed Performance Rebate, which is an ongoing rebate based on how much backup power you use or sell to the state.
The Distributed Fixed Incentive (Upfront Rebate)
This incentive acts like a cash-back rebate to help lower the upfront cost of buying and installing your home battery. If you qualify, you’ll receive an upfront rebate between $1,250 and $1,625.
Here are the steps you’ll need to take to claim the distributed fixed incentive:
1. Partner with an Approved New Jersey Solar Contractor
Before any paperwork can be filed, you’ll need to contact an approved New Jersey solar contractor like Exact Solar. If you work with Exact Solar, we’ll evaluate your home’s electrical panel, help you choose the right battery system, and ensure your setup complies with all local and state grid rules.
2. Designer Proposal & Incentive Pre-Approval
Once you choose a system, your installer will design a customized battery system. either paired with a new solar array or as a standalone backup unit. Your installer will handle the project designs, interconnection paperwork, and rebate application with the New Jersey Board of Public Utilities (NJBPU) on your behalf.
It’s important that you submit your paperwork quickly once the rebate program opens. State rebate money for home upgrades tends to run out quickly. Your spot in line starts the exact day and time the program administrator receives your completed application.
New Jersey will set aside a certain amount of battery capacity each year in “capacity blocks”. Once a block fills up with applications, the next block will likely open with a lower rebate.
3. Installation, Inspection, and Rebate Credit
After the application is approved, your installer will complete the installation, clear local township inspections, and activate the battery with your utility company. Once the system is fully operational and approved for grid connection, your installer will finalize the rebate claim.
After installation is complete, your installer will also help you enroll in optional Virtual Power Plant (VPP) programs through your utility provider, allowing you to earn an additional $150 to $300 in annual performance payments.
The Distributed Performance Incentive (Ongoing Payouts)
The second part of the program is an ongoing, annual payout that rewards you for helping the grid.
During times of extreme heat or high grid stress (usually on hot summer afternoons when everyone’s running their AC), your battery will automatically discharge its stored power to run your home. Sometimes, your utility company will pull from it to help reduce the load on the grid.
Every year, you will receive a check from your utility company based on how much power your battery provided.
This will net you anywhere between $150 and $300/year.
This will be especially powerful if you plan to install solar at the same time. There are several rebates available in New Jersey for solar and batteries that will help your solar energy system pay for itself much faster.
New Jersey’s Solar and Battery Incentive Stack
Even without the federal tax credit for cash purchases, New Jersey is still one of the most profitable states in the country for clean energy. This is thanks to our incredible state-level incentives.
Exact Solar can help you combine all the different programs to get the fastest ROI on your solar investment. Here are the incentives available for New Jersey homeowners today:
| Incentive Type | How It Works | Estimated Value |
| NJ Sales Tax Exemption | Solar and battery equipment and installation labor are 100% exempt from the state’s 6.625% sales tax. | Saves $1,600 to $2,200 on a typical system. |
| Property Tax Exemption | Adding solar and batteries increases your home’s value, but New Jersey law says this cannot increase your property taxes. | $0 added to your property tax bill after going solar in New Jersey. |
| Net Metering | Your utility credits you at the full retail rate of electricity (about $0.26/kWh) for any excess solar power you send to the grid. | Thousands of dollars in bill savings over the life of your solar energy system. |
| SREC-II ADI Payments | Under the SuSI Program, the state pays you a fixed, guaranteed rate for every megawatt-hour (MWh) of solar energy you generate for 15 years. | Generates $10,000 to $12,000 in direct income for a typical home system. |
| GSESP Phase 2 Rebates | Upcoming upfront and performance-based state incentives for home batteries. | After launching in 2026, this program will offer homeowners thousands of dollars over the lifetime of a system. |
What to Do Now
If you’re interested in getting the state of New Jersey to pay you to install a home battery, now is the time to contact a highly qualified, well-reviewed local solar and battery installer.
Our team at Exact Solar would love to work with you to make sure you get every dollar you can. Schedule your free consultation with our team today!
Frequently Asked Questions (FAQ)
1. What is the Garden State Energy Storage Program (GSESP)?
The Garden State Energy Storage Program (GSESP) is New Jersey’s state program that funds energy storage (batteries) throughout the State. Run by the New Jersey Board of Public Utilities (NJBPU), the program aims to deploy 2,000 megawatts (MW) of energy storage by 2030 to strengthen the local power grid, prevent storm-related blackouts, and reduce long-term electricity costs for New Jerseyans.
2. When can New Jersey homeowners apply for these battery incentives?
Homeowner battery incentives are part of Phase 2 of the GSESP, also known as the “distributed segment”. The program is expected to be finalized and open to homeowner applications later in 2026. Exact Solar will announce when the battery program opens via our email list and social media channels.
3. How do the GSESP Phase 2 incentives work?
The program offers two different incentives that will compensate homeowners for the upfront cost and then, over time:
- Distributed Fixed Incentives (Upfront Rebates): This is a cash-back rebate designed to directly offset the purchase and installation cost of your home battery.
- Distributed Performance Incentives (Ongoing Payments): These are annual cash payments from your utility company based on how much power your battery provides to support the grid when called upon during peak energy events.
4. Can I still get the 30% federal tax credit if I buy a battery in 2026?
If you purchase your system outright with cash or a solar loan, you are no longer eligible for the 30% personal tax credit. The One Big Beautiful Bill Act officially ended the residential Section 25D tax credit for solar and home battery systems as of December 31, 2025.
5. If I install a battery, will it reduce my New Jersey solar net metering or SREC-II benefits?
No, it will not. Adding a battery to a home solar system does not impact your eligibility for the state’s net metering credits or your SREC-II production payments. You can only claim these incentives if you have a solar energy system.
6. What are “capacity blocks” and why does the “block priority date” matter?
The state plans to release Phase 2 funding in yearly “capacity blocks”. Once a capacity block is fully claimed by applications, the block closes, and the next block may open with a slightly lower incentive level.
Your spot in line is called your block priority date, which is set the exact moment the program administrator receives your completed application. Homeowners who partner with an installer to complete their application as soon as the program opens will have a much better chance of getting the rebates.
7. Do I need to have solar panels on my house to qualify for the battery rebate?
No. Standalone home battery systems and batteries paired with a Class I renewable energy system (such as solar panels) are eligible to qualify for the GSESP Phase 2 incentives.
8. What is a “Virtual Power Plant” (VPP) and how does it relate to this program?
A Virtual Power Plant (VPP) is a digital network of home batteries. When the electric grid is stressed, the VPP can discharge power from these batteries to lower demand. In January 2026, Governor Sherrill signed Executive Order 2, which fast-tracked the development of a statewide VPP program that will coordinate directly with the GSESP Phase 2 battery networks.
9. Can I apply for these battery rebates myself?
Homeowners cannot apply for the New Jersey battery rebates on their own. They must have a local solar installer like Exact Solar do so on their behalf.