Illinois projects to install nearly 5,700MW of solar energy over the next 5 years. That’s enough electricity to power almost 900,000 households. With the Prairie State ready to invest heavily, now is the right time for homeowners to consider solar panels in Illinois.
You might wonder about how to cover the cost. No worries, we’ve got you covered. The state has one of the strongest emerging renewable standards, which makes it easy for homeowners to install a solar array. Here’s everything you need to know about the existing programs.
How to Save Money on Solar Panels in Illinois: Overview
Because of relatively low sunshine and the affordable price of traditional electricity, homeowners in Illinois might not find much reason to switch to solar energy. However, upgrading to an array can save you thousands of dollars over its lifetime. Additionally, Illinois is one of the emerging states that is investing in renewable energy.
This is good news for homeowners in the Prairie State. Legislation in Illinois is moving forward with performance programs, net metering laws, and more. Combined with the federal solar tax credit, Illinoisans could drastically reduce the price of a solar array and even earn money in the long run.
Solar Panels in Illinois: Federal Incentive
Whether you live in Illinois or any other state, you can apply the federal solar tax incentive to your solar installation so long as you meet the qualifications. While you’ll have to purchase your system outright (loans work but leases don’t), you could see 30% back in the form of a credit on your federal taxes. In Illinois, this program can save homeowners nearly $5,000. For more on how this works, check out our federal solar tax credit article.
Illinois State Credits and Rebates
In many states, homeowners can receive direct financial rewards for their solar panel systems. These typically come in the form of credits off income taxes or municipal rebates for equipment. Currently, solar panels in Illinois do not come with credits or rebates of these types. However, with the state’s improving renewable support, we could see them implemented in the near future.
That being said, Illinoisans can still receive money back by connecting their system to the power grid. The Prairie State mandates inter-connectivity and net metering laws, which require municipalities to pay homeowners for excess solar energy. This comes in the form of a credit on the next month’s bill. These credits expire at the end of the year, however, so it’s not worth it to install more solar than you need (for the time being).
Homeowners can earn significant benefits by signing up for the state’s performance program. The Adjustable Block Program, branded Illinois Shines, allows you to sign over your expected solar renewable energy certificates (SREC) to your solar installer for a price of $64 each. With an average, 6kW system expected to produce about 110 SRECs throughout the program, Illinoisans could see up to $6,600 off their installation cost.
Solar Panels in Illinois: Government Regulations
A lot of Illinois’ solar incentives stem from its renewable portfolio standards (RPS). This is a set of goals that intend to strengthen the state’s renewable infrastructure. Illinois has a forefront goal of reaching 20% renewable energy production by 2025. With this goal coming up soon, we can expect the Prairie State to up its solar mandates.
Common regulations that stem from a strong RPS are tax exemptions. In some states, homeowners can waive the sales tax on their solar purchases, which lowers the overall cost but also the amount you’ll receive on your federal solar tax credit. However, Illinois currently does not offer this type of exemption.
Instead, they provide property tax adjustments. While this doesn’t act the same as a regular property tax exemption, it does update the amount you’ll be charged at the end of the year. This adjustment varies by household, so you’ll have to register with the county you live in.
Should Illinoisans Lease Solar?
Leasing solar panels in Illinois is an option available to those that want to improve their carbon footprint but don’t have the funds to purchase the equipment outright. However, it’s essential to know that while you can save money going this route, it won’t compare to bought systems. Additionally, you won’t get to take advantage of Illinois’ Adjustable Block Program or the federal solar tax credit. Overall, you should only consider this option if you’re looking to support the environment.
Solar Panels in Illinois: Incentive Summary
|Federal Tax Incentive||30% credit|
|Illinois Tax Credits / Rebates||None / none|
|Net Metering||Available at the full retail rate, no annual payout|
|Renewable Portfolio Standard||25% by 2025|
|Property Tax Exemption||Property tax rate adjustment|
|Sales Tax Exemption||None|
|Performance Payment Program||Adjustable Block Program|
How to Save Money on Solar Panels in Illinois: Further Reading
Homeowners can save good money on solar panels in Illinois despite low sunlight. With decent net metering laws and performance programs supported by an emerging renewable portfolio standard, Illinoisans can easily afford an installation. For more on how the Prairie State supports new technology trends, read these articles below.
How to Save Money on Solar Panels in California – Learn more about how Illinois’ solar programs compare to one of the leading states in renewable energy.
Owning an EV in Illinois: Charging Cost, Incentives, and More – With a large segment of Illinoisans living in or around cities, it might be worth considering an electric vehicle.
Largest Tech Companies in Illinois – At the heart of the Prairie State are some of the country’s most prominent technology companies. Here’s what you need to know about them.