Illinois has invested heavily in its sustainable energy future over the past decade with a focus on utilizationsolar powera significant part of state energy in the coming years.
To accomplish this, the state has created policies, plans, and incentives for homeowners making the switch to solar power. Here's what you need to know if you're an Illinois resident looking to invest in solar energy.
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Solar Energy in Illinois
The solar market is thriving and growing at a rapid pace in Illinois, where the state has created the framework for reaping significant dividends from sustainable energy investments and is incentivizing residents and organizations to do the same.
A Renewable Portfolio Standard (RPS), first introduced in 2007 and updated by the Future Energy Jobs Act and the Climate and Equitable Jobs Act, requires the state to generate 25% of its energy from renewable sources by 2025 and the next five years, theSolar Energy Industry Associationexpects installed solar capacity in Illinois to grow more than 1,700%.
The state has invested more than $2 billion in solar energy and created more than 5,000 jobs, with growth forecast to be exponential. Over the past five years, solar prices have fallen 4% while solar installations have increased by more than 2,000%.
State incentives support Illinois residents and organizations making the switch to solar power, including rebates on excess energy generated and programs to support or remove the financial hurdle that comes with equipment and equipmentInstallation. These incentives are in addition to the federal solar tax credits, all of which are designed to help homeowners who invest in solar systems.
Illinois law requires the state to achieve 100% sustainable energy by 2045, which includes a special spin-off for solar-derived energy (SRECs).
Cost of solar panels in Illinois
According to EnergySage, the average pre-tax solar panel cost in Illinois in April 2022 is $3.04/W. The average cost of solar panels varies by system size –more panelsmeans higher equipment and installation costs - but panels can be purchased at a bulk price, resulting in a lower cost per watt.
With a solar system size of five kilowatts (kW), the average installation cost in Illinois ranges from $12,920 to $17,480. Note that after accounting for the Federal Investment Tax Credit and other state and local incentives, your net price will likely drop by thousands of dollars.
In addition to equipment and installation costs, solar costs also include permit costs, inspection costs and installer profit margins, which vary by region and company.
Tax credits for federal solar investments
There are federal tax incentives to install a solar system in 2022 if you meet criteria set by the US Department of Energy: you must own your home (renters are excluded), the solar panels must be new or first-time use, and you must Own your solar panels.
With the solar investment tax deduction, you can claim 26% of your total project cost (including equipment, permits, and installation) as a credit on your federal tax return. ($1 credit = $1 less tax the following year.) This is different from a tax refund; You must owe taxes in order to be eligible to claim your debt reduction.
The federal solar investment tax credit is available to all states at 26% for residential solar systems purchased and installed by December 31, 2022, decreasing to 22% by 2023.
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Illinois Solar rebates and tax credits
There is no solar panel tax credit in Illinois, but there are federally administered incentives to support the development of new solar generation and to help Illinois residents offset the cost.
Illinois shines: Illinois is one of the few states with a Solar Renewable Energy Credit (SREC) program to support solar project development in the state. Homeowners receive an SREC for every 1,000 kilowatt hours produced by their solar panels. According to EcoWatch, "These credits can then be sold to local energy companies that are subject to the state's Renewable Portfolio Standard, which requires them to generate at least 25% of their electricity from clean sources by 2025."
Also known as the Adjustable Block Program, this program, which began in January 2019, was so successful that it ran out of funding and was unable to accept new applications in 2021. It was reactivated and officially reopened in December 2021.
Illinois Solar for All (ILSFA): Government incentives are available to help income-earning homeowners, renters, nonprofits, and public entities install solar panels with either affordable or no upfront costs. Eligible participants work with verified ILSFA-approved providers to get affordable solar systems and pay a reduced fee for the energy generated over time.
solar grid measurement: Homeowners can obtain utility credits to “cash in” excess energy generated by their solar systems and not used in their home. It is a legal requirement that local utility companies charge solar panel owners for any excess electricity generated that is fed into the grid. Energy suppliers also benefit from this, as they can supply the excess solar power to other buildings in the same grid.
ComEd Solar Rebate: Commonwealth Edison (ComEd), the largest electric company in Illinois, is offering a nonresidential rebate: $250 for each kilowatt of solar power up to 2,000 kW.
Tax exemption for solar systems in Illinois
Installing solar panels increases the value of your home, but the resulting increase is not taxed in Illinois.
Local Incentives
Additional solar incentives may be offered by your city, county, or utility company.
Which solar system is right for your home?
The right solar system for your home is the one that takes advantage of your home's energy efficiency and solar potential. Before you invest in solar,US Department of Energyrecommends homeowners understand their total electricity consumption and how to do itOptimize energy efficiencywhere you can A home energy audit can outline steps you can take to minimize energy loss or overspending.
There are online tools that can help you predict your home's suitability for solar panels such asSolar potentialfrom the Solar Energy Technologies Office (SETO) and their Sun Number Score technology. Google's Project Sunroof can also estimate the solar savings potential of your roof.
Homes that are well suited to solar panels get enough sunlight (slightly pitched, south-facing roofs are ideal) and have roofs in good condition that will last for decades. If you live in a sun-poor area, your roof gets too much shade, has too small an area, needs to be replaced in the foreseeable future or cannot support solar panels for other reasons, you can still use solar energy.
Regionalmunicipal solar systemsFlow solar power from an external array to customers within a geographic area. Customers can purchase or lease panels within this formation and, just like customers who own their homes and solar panels, receive a utility bill credit for the electricity generated by their share. If you don't own your home and are a renter looking to take advantage of solar resources, Community Solar is an excellent option.
Best Solar Companies by State and City
Benefits of switching to solar energy
- The environmental benefits of using solar energy are enormous. It is a clean, renewable and inexhaustible source of energy, and using it reduces your carbon footprint, decreases your dependence on fossil fuels and natural gas, reduces the load on the electricity grid and produces no pollutants, including noise. As long as the sun shines, free solar power is available.
- You qualify for tax breaks and discount incentives. Whether you install a new solar system and receive federal, state, or local tax credits, or your utility company pays you for the excess energy your solar system generates, there are a number of financial benefits of going green.
- A high return on investment is likely. Installing solar panels adds value to your home and can reduce or even eliminate your energy bills, saving your wallet from the rising cost of energy and utilities.
- The cost of converting to solar energy has come down and the clean energy economy has increased. Although a large financial investment in solar energy can seem daunting, federal and state governments have created incentives for solar energy to make it more accessible. As a result, competition in the market has grown, as have clean energy jobs, which means lower solar panel installation costs for the customer.
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THIS IS ADVERTISING AND NOT EDITORIAL. Please note that we receive compensation for any products that you purchase or sign up for through this advertisement and that compensation will affect the ranking and placement of all offers featured here. We do not inform about every available offer. The information and savings figures shown above are for demonstration purposes only and your results may vary.
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How to choose the best solar panel company in Illinois
There are a number of factors to consider when evaluating solar panel companies to ensure you are getting the most out of your investment and ideally a positive net return on that investment.
- equipment: Not all solar panels are created equal. When choosing theThe best solar panels for private homes, evaluate the efficiency of each company's solar panels — power rating, power tolerance, efficiency, and temperature coefficient — to understand how much energy those panels are expected to generate. Compare this to the industry standard solar panel efficiency of 16% to 18%. The most efficient panels may not always have the best cost-per-kW - and the best value can vary depending on the number of panels installed - so you may need to do some math.
- manufacturer quality: Check production, equipment durability, solar panel manufacturer warranties and representations. The industry-standard manufacturer's warranty averages 10 to 25 years. If you live in an area with weather conditions that could take a toll on your solar panel installation, verify that the panels you purchase are designed to withstand the rigors of the outdoors.
- Installation: Like any other professional you hire, check a solar panel company's certifications, licenses, warranties, ratings, and local reputation. TheThe best solar companieshas a full time knowledgeable team that should be able to answer any questions you may have throughout the installation and life of your solar system.
- Local Incentives: In addition to the state and regional benefits of switching to solar power, a study by the National Renewable Energy Laboratory (NREL) found that larger companies tend to cost an average of 10% more than smaller, local solar companies for the same or lower quality of equipment. Take a look around to see if you could save by choosing a local solar company.
Frequently Asked Questions (FAQs)
What Are the Benefits of Solar Energy in Illinois?
Illinois has a Renewable Energy Standard (RES) policy, which means solar seekers will have more support and benefits as they transition to clean energy.BISstates that "RES policies do not significantly increase electricity prices and often result in cost savings for consumers." Illinois' RES policy also increases local demand for solar technology, leading to job creation and economic development. Also specific to Illinois, income-eligible homeowners and organizations with the state's incentives may be able to switch to solar at a 0% upfront cost.
Google's Sunroof project estimates that the average Illinois home will see approximately savings over 20 years after purchasing a solar panel8.000 $.
Which Illinois Cities Have Better Solar Tax Exemptions and Reductions?
There are no special tax credits for solar panels in Illinois.
Although installing solar panels increases your property value, all newly installed solar energy systems in Illinois are exempt from an increase in property taxes. Thanks to the Illinois SRECs, there are also statewide rebates based on how much excess energy your solar system is producing.
You can also use solar calculators to analyze savings based on your zip code and utility company.
Should I buy or lease my solar panels?
Depends on. If the goal of switching to solar power is to generate positive net dividends, consider the costs involved in buying versus leasing — including your home's potential solar efficiency. Some states offer tax benefits and rebates only available to homeowners who purchase their solar panels, which can help you save big on expenses. If you live in a home that cannot support solar panels, if you are a renter, if you want to benefit from lower energy bills without investing major upfront installation costs, or if solar panels are available in your area, solar panel leasing can make sense its the best option for you.
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FAQs
What are the solar incentives for 2023 in Illinois? ›
Meanwhile, the federal solar tax credit provides a significant tax credit for homeowners: 26 percent for systems installed through December 31, 2022, and 22 percent for systems installed in 2023.
Does Illinois offer incentives for solar panels? ›Solar Renewable Energy Credit (SREC)
Residential: REC's are a state incentive, whose value is equal to the solar energy you produce over 15 years times the price set by the Illinois Power Agency for REC's. For your system, the value is 7.1 cents/kWh produced, which is paid in year one.
Qualified homeowners with home solar could be eligible for a tax credit of up to 30% against the cost of the system. Eligible low-income homeowners can get access to solar panels in Illinois with $0 up-front costs.
What is the average cost to install solar panels in Illinois? ›Illinois' average cost of a solar panel installation ranges from $13,430 to $18,170. On a cost per watt ($/W) basis, a solar panel installation in Illinois ranges in price from $2.69 to $3.63.
Do solar panels increase property taxes in Illinois? ›There are no specific tax credits for solar panels in Illinois. However, although installing solar panels will increase your property value, any new solar energy systems installed in Illinois are exempt from an increase in property taxes.
How long does it take for solar panels to pay for themselves in Illinois? ›Average Solar Payback Period in Illinois
The time it takes for you to pay off your solar panels and start enjoying savings is called the solar panel payback period. In Illinois, the average payback period is around 12 years, with most residents falling between 9 and 15 years.
Those who already have a solar energy system can register with Illinois Shines and receive 15 years of payments in return for solar renewable energy credits (called SRECs or RECs). You'll receive credits for each megawatt (MW) of electricity produced over the payback period.
Does Illinois buy back power from solar power? ›Illinois net metering
Thanks to Illinois' net metering policy, your utility will buy back any excess electricity your solar system produces.
The RHI was a government scheme which provided MCS certified solar thermal panels. This ended in March 2022 and was replaced by the Boiler Upgrade Scheme. This scheme funds some solar panels as part of a heat pump system, but applications for this are now closed.
Can I write off my solar bill? ›Yes. If you financed the system through the seller of the system and you are contractually obligated to pay the full cost of the system, you can claim the federal solar tax credit based on the full cost of the system.
Can you sell solar energy back to the grid Illinois? ›
For every megawatt-hour you produce with your solar panels and send to the grid, you receive one REC, which you can then sell at a price set by the Illinois Commerce Commission and the Illinois Power Agency. Learn more about RECs and pricing here.
How many years can you write off solar panels on taxes? ›You can only claim the solar tax credit one time for your solar power installation. If you have any unused amount remaining on your tax credit that you are unable to claim in a single tax year, you may be able to carry over that tax credit value for up to five years.
How much does it cost to put solar panels on a 2400 square foot house? ›The average cost of a residential solar panel installation in 2022 ranges between $18,000 and $20,000, before applying tax credits or other incentives that may be available where you live.
Is Sunrun a reputable company? ›As mentioned above, Sunrun doesn't have a great reputation when it comes to customer service, follow-up during the installation process or responding to warranty claims. Many of the reviews online are overwhelmingly negative and call out the company for unresponsiveness and poor service.
Are more expensive solar panels worth it? ›When it comes to solar panels, you often get what you pay for. More expensive solar panels will usually be of a higher quality and will be more efficient. This means that they will produce more electricity and will last longer.
Is net metering going away in Illinois? ›Note: The Climate and Equitable Jobs Act (Illinois Public Act 102-0662) removed the 5% aggregate cap on net metering and replaced it with a threshold date of December 31, 2024, or when utility tariffs setting new compensation values are approved, whichever is later.
What is considered high property tax in Illinois? ›...
Overview of Illinois Taxes.
| McHenry County$13,500 | 2.700% of Assessed Home Value |
|---|---|
| National $4,950 | 0.990% of Assessed Home Value |
Illinois Shines – Illinois Shines is a state-administered incentive program supporting the development of new solar energy generation in Illinois. Please note that information on this site may not incorporate programmatic changes from the passage of the Climate and Equitable Jobs Act on September 15, 2021.
What is the break even point for solar panels? ›The payback period for solar panels is the amount of time it takes for the energy savings to exceed the cost of going solar. Also known as the break-even point, a typical payback period for residential solar is 7-10 years.
How long do solar panel batteries last? ›On average, solar batteries last between 5 to 25 years. Lithium-ion batteries are the most prevalent solar battery type and have a lifespan of up to 15 years. Some factors that impact a solar battery's longevity are battery type, installation, depth of discharge, cycle life, environment and maintenance.
Do solar panel companies own your roof? ›
Solar Panels – Ownership and Maintenance
Where solar panels have been installed by a solar panel provider, the provider will usually own and maintain them under the roof top lease. The lease should set out clearly the responsibilities for maintenance and removal of the panels where works are required to the roof.
What incentives are available for solar in Cook County, IL? At a minimum, solar installations in Cook County, IL are eligible for the 30% solar tax credit. Learn more about other local Cook County, IL incentives, tax credits & rebates to help you lower the overall cost of going solar even more.
How much does Illinois pay for SREC? ›New pricing is set to be announced in August, 2022, but prices have typically ranged from around $37 to $76 per SREC. This means most homeowners with a 6 kW array could earn around $360-$750 each year for their SRECs in Illinois.
Do solar panels stop electricity bills? ›The biggest benefit of having solar panels installed is that you will save on electricity costs. If your solar panels are large enough, you may be able to produce enough electricity for your whole home. The Energy Saving Trust's solar energy calculator will give you an estimate on how much you could save.
Can you sell electricity back to the grid? ›If you generate renewable electricity in your home or business, you can feed back into the grid any electricity that you don't use. Under the Smart Export Guarantee ( SEG ) you will be paid for every unit of electricity that you feed back.
What is the government solar panels program 2023? ›What is the Government Solar Panels Program 2023? Funding is available to households under the government-backed ECO4 Scheme. Grants for solar panels will help households with low energy efficiency homes who are considered likely to face financial difficulties heating their homes.
How do you qualify for a solar grant? ›Be the owner of a home built and occupied before 2021. Use new materials and products that were not already covered under another grant scheme. Use a registered company from the SEAI's registered list of companies.
Who is eligible for solar panel grant? ›Eligibility. The ECO4 scheme is open to low-income, fuel-poor and vulnerable households receiving benefits. To be eligible for solar PV panels, your home needs to meet specific requirements: currently have an inefficient heating system within the D-G energy efficiency band.
What proof do I need for solar tax credit? ›Filing requirements for the solar tax credit
To claim the credit, you'll need to file IRS Form 5695 as part of your tax return. You'll calculate the credit on Part I of the form, and then enter the result on your 1040.
How does the solar tax credit work? The solar tax credit is a non-refundable credit worth 30% of the gross system cost of your solar project. That means that if the gross system cost is $20,000, your tax credit would be $6,000 ($20,000 x 30%= $6,000).
What is the new net metering law in Illinois? ›
Illinois net metering law requires investor owned utilities (ComEd, Ameren, MidAmerican) to offer one-to-one net metering for renewable energy generation that is sized to offset the household's energy usage.
Does Illinois have net metering for solar? ›Homeowners and small business owners who have a solar power system or a wind turbine can use net metering to offset their traditional utility costs while using cleaner energy. Q. How does the Illinois net metering program work? A.
What is the best state to sell solar panels? ›Although California is by far the best solar job market with a total of 75,712 solar jobs, Florida, Massachusetts, New York and Texas have also created thousands of jobs due to their solar implementation.
What is the downside of solar panels on roof? ›On the other hand, the key disadvantages of solar energy are that it doesn't work for every roof, it's not ideal if you're about to move, the upfront cost can be expensive, savings can be low if your electricity bills are low, and finding a local installer can be difficult.
Why am I not getting my full solar tax credit? ›In short, you must owe at least as much money in taxes as the amount of your credit in order to receive the full amount of that solar tax credit.
Can I write off a new roof for solar? ›Previously, it allowed homeowners a federal solar tax credit for roof replacement. This equaled 30 percent of the cost of installing a solar energy system on their home. As of 2020, the deduction dropped to 26 percent. In 2021, it will become 22 percent, and from 2022 onward, 10 percent.
What does a Tesla powerwall cost? ›A single Tesla Powerwall has a price of $10,500. The system price increases based on how many units are connected together (up to 10), and the price per Powerwall is lower when installing two or more.
How big of a solar panel do I need for 2000 square foot house? ›A 2000 square foot house will need 28- 34 solar panels, which comes out to an average cost of \$3.50 per watt. Not only will installing solar panels save homeowners money on their electric bill, but they can also increase the value of their home.
Is Sunrun owned by Costco? ›No. Although Costco and Sunrun are partners in advertising solar, Costco does not back the warranties for your solar panel system – all they provide is a Costco Cash Card and access to their Costco Member Service Hotline.
Why is Sunrun going down? ›Solar companies SunPower and Sunrun were downgraded by Barclays. Wall Street is getting more bearish on clean energy but some strategists still see tailwinds. On Wednesday, Barclays downgraded solar companies SunPower (ticker: SPWR) and Sunrun (RUN), citing slowing U.S. residential demand.
Is there a lawsuit against Sunrun? ›
SunRun Inc. has been hit with a class action lawsuit alleging the San-Francisco-based solar energy company deceived consumers into leasing SunRun solar panels by making misleading claims about their cost savings and about the increasing costs of electricity.
Are solar panels worth it in Illinois? ›Illinois residents pay around 13.04 cents per kilowatt-hour, which is just below the national average rate. Given the low price of solar equipment and the average energy rates, many homeowners in the area will find that solar is a worthwhile investment.
How do I know if a solar panel is of good quality? ›The best photovoltaic solar panels have a “positive only” power tolerance, which means that you are guaranteed to get at least the specified output power of the panel. For example: a 200W solar panel with a tolerance of + 5% / – 0% will produce a minimum of 200W and a maximum of 210W.
What is the difference between cheap and expensive solar panels? ›A good quality panel differs from a cheaper one in the sealing materials used such as backing sheets, the soldering and the efficiency of the solar cells. For example, whilst LG panels will cost slightly more they are designed to deliver year after year performance.
Will there be a solar tax credit in 2023? ›Prior Law — Investment Tax Credit for Solar Energy Property
Solar generation facilities were eligible for an ITC claim and subject to the standard phase-out of that credit (i.e., maximum credit of 26% in 2020-2022, which dropped to 22% in 2023 and then 10% in 2024 and thereafter).
The good news? Solar costs are very likely to decrease in 2023, making rooftop renewables affordable for more homeowners. In November 2022, the National Renewable Energy Laboratory (NREL) published its analysis of the cost of solar and energy storage (battery) system installations for the first quarter of 2022.
What is the solar stimulus program Illinois? ›What is Illinois Solar for All? Illinois Solar for All (ILSFA) helps make solar installations more affordable for income-eligible households and organizations through state incentives. ILSFA has programs for income-eligible homeowners and renters as well as non-profit organizations, and public facilities.
What is the solar power target of Budget 2023? ›However, there is still much work to be done, with a need to install 25-30 GW of solar energy each year for the next eight years to meet its 280 GW solar target.
Do I need to tell my electricity supplier I have solar panels? ›If you install generation equipment like solar panels at your home, and the equipment is connected to the grid, your DNO must be notified. This is because they need to know if you're putting electricity onto the grid, so they can manage their networks efficiently. Most installations are connected to the grid.
How many years can I claim solar tax credit? ›If you have any unused amount remaining on your tax credit that you are unable to claim in a single tax year, you may be able to carry over that tax credit value for up to five years.
Are solar prices dropping? ›
In 2023, solar panels in the U.S. cost about $20,020 on average down from more than $50,000 10 years ago. In this article, we'll break down the cost of solar by system size, state, and panel brand, all of which can significantly impact the final number you pay.
Does solar raise property value? ›Yes, solar panels will raise your home's property value. Although the added value can vary by location, the National Renewable Energy Laboratory (NREL) found that home value increases by $20 for every $1 saved on your utility bills. This translates to a higher market value when selling your home.
Are solar batteries worth it in 2023? ›Solar batteries are definitely worth it in 2023 and beyond. As solar feed-in tariffs continue to drop to negligible levels, solar panels just don't make sense without a battery. Without a battery, you're paying for your electricity as soon as the sun disappears.
Is the government really giving out free solar panels? ›Simply put, you cannot get free solar panels from the government. These payment plans are actually solar leases or PPAs, and they're a no-cost upfront option that gives ownership to the solar company or installer.
Can you get a government grant for solar? ›You can apply for the ECO4 grant if you're in recipient of benefits and if you own your home, or have permission to install solar panels from your landlord if you are renting. Full eligibility criteria can be found on the ECO4 website (opens in new tab).