What makes Illinois a leader in solar energy?As we mentioned in previous blog posts, Illinois is a fast-growing solar market thanks largely to the state’s Renewable Portfolio Standard (RPS) legislation and the financial solar incentives available in Illinois.
What is the Illinois Renewable Portfolio Standard?The state’s Renewable Portfolio Standard (RPS) is a piece of legislation that sets a goal of having 25% of all electricity come from renewable resources by 2025.
What are the Solar Energy Incentives in Illinois?There are many incentives available for solar energy in Illinois. These incentives, which are a mix of federal, state, and local, are aimed at improving the investment return on solar energy systems. These incentives significantly reduce the cost of solar energy systems in Illinois.
The Federal Investment Tax Credit (ITC)The Federal Investment Tax Credit (ITC) is the most well-known incentive for renewable energy projects in the US. The ITC allows the owner of a solar energy system to deduct 22% of the cost of the system from their federal income tax . This is an uncapped deduction available to both individuals and businesses, making it a perfect complement to a technology as modular and scalable as rooftop solar energy! While this is a very simple way to reduce the net cost of solar energy systems, there are a few things you need to keep in mind. First, as the ITC is an income tax credit, you must declare enough taxable income for the value of the credit to be maximized! Second, you must be the owner (either cash or financed) of the system. If you are on a PPA or lease program, you are not the owner of the system and therefore cannot claim the ITC.
Solar Renewable Energy Credits (SRECs)Illinois’s Solar Renewable Energy Credit program rewards homeowners for making the switch to solar. This is also called The Adjustable Block Program or “Illinois Shines.” The way this program works is that you’re given one Solar Renewable Energy Credit for every MWh of electricity your solar panels produce . Thanks to the state’s RPS, which we discussed above, there is a requirement for large consumers to have a portion of their electricity be backed-up with RECs, and specifically SRECs. This means that there is a market for the SRECs minted for a rooftop solar owner! You can sell these credits from 5.0 to 8.0 cents per kWh .
ComEd Distributed Generation RebateComEd, the largest electricity provider in the state of Illinois, offers a rebate program for commercial and industrial (C&I) distributed generation (i.e., rooftop solar) systems up to 2 kW. As part of this program, ComEd will provide rebates of $0.25 per Watt if the customer is a registered participant of their net metering program (another great incentive to take advantage of). More information on the Distributed Generation Rebates program can be found on the ComEd website.
Property Tax BreakEven though having solar panels does increase your property value, you don’t have to worry about paying higher taxes – Illinois’ solar property tax break means you won’t be taxed for that additional value.
And Many MoreThese are just a few of the incentives offered to solar energy owners in Illinois. If you are looking for a more in-depth look at these, and other, solar incentives in Illinois check out our post Are Solar Panels Worth it in Illinois?.
What are the costs of Solar Energy in Illinois?The cost of solar panel installation in Illinois can vary depending on the system size, roof conditions, experience of the selected installer, and many other factors. However, we can say with good certainty that installation costs in Illinois range from approximately $2.63 to $3.55 per watt. If you’re looking for a detailed breakdown of that post, be sure to read our post cost of solar panel installation in Illinois.
What makes Illinois a leader in wind energy?The Illinois RPS target of 25% renewable electricity by 2025 doesn’t just apply to solar; it applies to all forms of renewable energy, including wind. In fact, the RPS has a specific carve-out stating that of the 25% renewable share, 75% of that must come from wind power. Another way to think of this is that Illinois has a mandate to get 18.78% of their electricity from wind power . As of April 2020, the state was halfway there, with 9% of electricity coming from wind power . While there is still a long way to go to reach the RPS target, this is surely a sign of impressive growth on the horizon!
What are the Wind Energy Incentives in Illinois?Just like solar energy, there are also financial incentives in Illinois aimed at spurring growth towards that 18.78% wind target.
The Federal Investment Tax Credit (ITC)The first thing to note is that the Federal ITC applies to both wind and solar energy systems. So, owners of wind energy systems can also claim 22% of the system cost on their federal income tax return.
Renewable Energy Credits (RECs)As wind energy is also a key part of the state’s RPS, the energy produced by wind turbines also receives renewable energy credits (RECs) that carry a monetary value. For wind energy projects, RECs are distributed through a central procurement program run by the Illinois Power Agency.
The Federal Production Tax Credit (PTC)Wind energy systems are also eligible for a tax credit based on how much energy they produce. This means that wind energy owners get a federal tax credit of 1-2 cents per kilowatt-hour .
How can you power your business with wind or solar energy in Illinois?
With strong financial incentives and a mandated push towards 25% renewable electricity, Illinois is a leader in both solar energy and wind energy. More businesses than ever are choosing to power their operations using clean renewable energy from the thousands of wind and solar farms in Illinois. While both technologies offer affordable, clean, renewable electricity, the barriers to entry are considerably different.
Powering your business with wind energy
Wind energy projects require considerable capital investment, regulatory know-how, and several years of planning and project execution before any renewable kilowatt-hours are ready for consumption. This means that wind energy projects are typically reserved for large companies that specialize in highly complex infrastructure projects.
There is a way around this hurdle, however: purchasing certified green electricity from your local retailer. Most electricity retailers offer programs where, for a few extra cents per kWh, you can ensure your electricity is coming from wind and/or solar energy. While this provides an easy way to go green, it does not offer any financial incentive, since this is a cost and not an investment that will make you money in the long run.
Powering your business with solar energy
Rooftop solar energy provides your business with the best of both worlds: clean renewable electricity, and an investment that will provide a strong R.O.I. Rooftop solar energy systems are scalable (making them an ideal solution for your business of all sizes) and quick to install. On top of that, the strong financial incentives available in Illinois make the investment a no-brainer for almost anyone.
Illinois is a leader in both solar energy and wind energy and more businesses than ever are choosing to power their operations using clean renewable energy. While both wind and solar energy offer affordable, clean, renewable electricity, the barriers to entry are considerably different.
Wind energy projects are complex and expensive. They are massive infrastructure projects reserved for the large companies known for this type of work. However, you don’t need to own a wind farm to get clean electricity since many retailers offer certified green electricity as an option to their customers.
Solar energy projects on the other hand are much more accessible. They do not require considerable capital investment and any regulatory and project execution aspects can be quickly handled by the experts at Eco Solar. We can provide you with a turnkey solution in a matter of weeks.
With this in mind, it’s not difficult to see why so many businesses in Illinois are opting for rooftop commercial solar systems. Contact us to learn how your business can save by doing the same.