Solar Power Saving

Illinois has made significant investments in its sustainable energy future, with a focus on incorporating solar power into the state’s energy mix. Over the past decade, the state has created policies, plans, and incentives to encourage homeowners to adopt solar energy solutions. If you are an Illinois resident considering investing in solar energy, it’s important to understand the various options available to you.

Solar Power in Illinois

Illinois has established a flourishing solar market with policies, plans, and incentives that incentivize residents and organizations to invest in sustainable energy. The state’s Renewable Portfolio Standard (RPS), first introduced in 2007 and updated through the “Future Energy Jobs Act” and the “Climate and Equitable Jobs Act,” mandates that the state generates 25% of its energy from renewable sources by 2025. The Solar Energy Industries Association predicts that the amount of solar capacity installed in Illinois will increase by over 1,700% in the next five years.

Illinois has invested more than $2 billion in solar energy, generating over 5,000 jobs with exponential growth expected. In the last five years, the cost of solar has decreased by 4%, and installations have increased by over 2,000%.

State incentives support Illinois residents and organizations who go solar, including rebates for excess energy produced and programs that assist or eliminate the financial burden of equipment and installation. These incentives complement the federal solar tax credit, all designed to benefit homeowners who invest in solar.

Illinois is dedicated to achieving 100% sustainable energy by 2045, with specific carve outs for energy generated from solar (SRECs).

Cost of Solar Panels in Illinois

According to EnergySage, the average solar panel cost in Illinois before tax is $3.04/W as of April 2022. However, the actual cost varies based on system size. Purchasing panels in bulk can result in a lower cost per watt.

For a five-kilowatt (kW) solar system, the average installation cost in Illinois ranges from $12,920 to $17,480. Keep in mind that your net price will likely decrease by thousands of dollars after factoring in federal tax credits and other state and local incentives.

In addition to equipment and installation costs, the overall expense of going solar also includes permitting fees, inspection costs, and installer profit margins, which will vary depending on the region and company chosen.

Tax Credits from the Federal Government to Encourage Solar Energy Investment

If you meet the criteria established by the U.S. Department of Energy, installing a solar system in 2022 could make you eligible for federal tax incentives. To qualify, you must own your home, use new solar panels or panels being used for the first time, and own your solar panels.

By taking advantage of the solar investment tax credit, you can claim 26% of your total project costs (including equipment, permitting, and installation) as a credit on your federal tax return. Each dollar credited means one less dollar owed in taxes the following year. It is essential to note that this is not a tax refund; instead, you must owe taxes to be eligible and claim the reduction in what you owe.

The federal solar investment tax credit is available to all states at 26% for home solar systems purchased and installed by December 31, 2022, and will decrease to 22% in 2023.

Illinois Offers Rebates and Tax Credits for Solar Power Transition

While there is no tax credit available in Illinois for solar panels, the state offers several incentives to support the development of new solar energy generation and help residents offset costs.

One such initiative is the Illinois Shines program, which offers a Solar Renewable Energy Credit (SREC) to homeowners for every 1,000 kilowatt-hours of energy produced by their solar panels. These credits can be sold to local power companies that are mandated to generate at least 25% of their electricity from clean sources by 2025 as part of the state’s Renewable Portfolio Standard.

The Adjustable Block Program, also known as Illinois Shines, was so successful that it ran out of funding and was unable to accept new applications in 2021. However, following the Climate and Equitable Jobs Act passed in September 2021, the program was reactivated and officially reopened in December of the same year.

Illinois Solar for All (ILSFA) is another state incentive available to income-eligible homeowners, renters, nonprofits organizations, and public facilities. Under this program, eligible participants partner with ILSFA Approved Vendors to receive affordable solar installations with either zero or reduced upfront costs. They then pay a reduced fee for the energy produced over time.

In summary, although Illinois does not have a tax credit for solar panels, the state offers a range of incentives, including the SREC program and Illinois Solar for All, to make solar energy more accessible and affordable for its residents.

Solar Net Metering

Through solar net metering, homeowners can earn utility credits by “cashing in” excess energy produced by their solar systems that they don’t use. Local power companies are required by law to provide full credit to solar system owners for all surplus electricity generated and exported to the power grid. This arrangement also benefits utility companies as they can supply the additional solar electricity to other buildings on the same grid.

Rebates from ComEd

ComEd, the largest electric company in Illinois, provides a rebate for nonresidential solar systems. The rebate amounts to $250 per kilowatt of solar capacity up to 2,000 kW.

Illinois Property Tax Exemption for Solar Energy Systems

In Illinois, the increase in home value resulting from installing solar panels is not subject to taxation.

Exclusive Incentives

Your city, county, or power company may offer additional solar incentives that are specific to your area.

Choosing the Right Solar System for Your Home

To ensure that you select the best solar system for your home, it is crucial to understand your property’s energy efficiency and solar potential. The U.S Department of Energy advises homeowners to evaluate their total electricity usage and optimize energy efficiency before investing in solar. Conducting a home energy audit can help identify areas where energy loss or over expenditure can be minimized.

Various online tools are available to project a property’s suitability for solar panels, such as the Solar Energy Technologies Office (SETO) solar rooftop potential and Sun Number Score technology. Google’s Project Sunroof also offers an estimate of a roof’s solar savings potential.

Homes that are suitable for solar panels typically have good roof conditions, slightly sloped south-facing roof surface area, and receive adequate sunlight. However, even if the roof is in poor condition, too small, gets too much shade, or cannot withstand solar panels, solar energy can still be utilized.

Community solar installations allow customers within a geographical area to buy or lease panels from an off-site array. Similar to homeowners who own their solar panels, community solar customers receive credits on their electric bill for the electricity generated by their share. For renters who do not own their homes but wish to use solar resources, community solar is an excellent option.

The Advantages of Switching to Solar Energy

Tips for Selecting the Top Solar Panel Company in Illinois

When evaluating solar panel companies, it’s essential to consider various factors to ensure that you maximize your investment and achieve a net positive return.

Illinois Solar Frequently Asked Questions:

What are the benefits of transitioning to solar energy in Illinois?

Illinois offers significant support and benefits for individuals seeking to switch to clean energy, thanks to its Renewable Energy Standard (RES) policy. According to SEIA, RES policies do not significantly increase electricity rates, and often result in cost savings for consumers. The Illinois RES policy also boosts local demand for solar technology, leading to job creation and economic development. Additionally, income-eligible homeowners and organizations in Illinois may qualify to go solar at zero upfront costs with state incentives.

According to Google’s Project Sunroof, the average home in Illinois can save approximately $8,000 over 20 years following the purchase of a solar system.

What tax exemptions and rebates are available for solar energy systems in Illinois cities?

While there aren’t any specific tax credits available for solar panels in Illinois, any new solar energy systems installed in the state are exempt from an increase in property taxes, which increases the value of your property. Additionally, statewide rebates are offered through the Illinois Solar Renewable Energy Credit (SREC) program. The rebate amount is based on the amount of excess energy your solar system produces.

To figure out potential savings based on your zip code and utility company, you can use solar calculators that analyze your data.

For those looking to install solar panels, SunVibe Solar is a provider that offers high-quality solar panels at competitive prices with exceptional customer service.

Should I consider buying or leasing solar panels?

The answer to this question depends on your specific situation. If the primary goal of going solar is to earn positive returns, it’s essential to evaluate the costs associated with buying versus leasing. You should also consider your home’s potential solar efficiency.

In some states, tax benefits and rebates are only available to homeowners who purchase their solar panels. This can result in significant cost savings over time. However, if your home cannot support solar panels, or if you are a renter looking to benefit from lower energy bills without investing significant upfront installation costs, leasing solar panels may be the best option for you. Community solar programs may also be available in your area, which may provide additional options for accessing solar energy.