Illinois Solar Incentives: Power Payback, Net Metering Illinois, Rebates, Credits

Georgette Kilgore headshot, wearing 8 Billion Trees shirt with forest in the background.Written by Georgette Kilgore

Solar Panels | March 18, 2024

Man relaxing on a solar panel and getting paid from Illinois solar incentives that lower the cost of solar panels in Illinois using federal tax credits, net metering, Illinois solar for all, Illinois shines and more.

The state of Illinois makes reducing the cost of solar panels in Illinois easy using Illinois solar incentives and federal programs.

With power payback, net metering Illinois, rebates, tax credits, and other initiatives, this Midwest state has moved towards a cleaner, greener future over the last decade.

If you have not really thought that much about converting to solar power, maybe this guide will change your mind.

All these programs and more are thanks to massive improvements in technology and the keen interest in alternative power sources. If you were waiting for a sign to invest in solar technology, this is your sign.

Residents can take advantage of Illinois solar incentives to reduce the cost of solar panels in Illinois when installing them on your home to reduce your emissions (and your electricity bill).

This guide explains how to do it.

Solar Power in Illinois

Solar energy Illinois is slowly but surely on the rise, and the state has made sure that the right initiatives are in place to guarantee an upward trend.

Organizations and homeowners have been incentivized already, and solar power is no longer a dream but becoming a reality, but before knowing the current statistics, you want to know how it all started.

Solar City Illinois came to be after the push by the RPS (Renewable Portfolio Standard) in 2007, which expected 25% of the power in Illinois to come entirely from renewable energy sources.

Pie chart showing Illinois renewable energy consumption including Illinois wind energy, biomass energy, geothermal energy, hydroelectric energy and solar energy in the state of Illinois for 2022.

So far, the state has invested an astonishing $2 billion towards solar power, and the number of solar roof Illinois has increased to as much as 2,000%.6

As if that is not enough, the introduction of solar power has also been credited for the creation of thousands of jobs in the clean energy sector and the 28% decrease in the emission of greenhouse gases.

Besides the Illinois solar incentives, the 11% price drop in solar prices has also led to a high number of new solar panel owners in the state.

There is a lot more in store for you as an Illinoisan if you wish to go solar, and who knows, you could be a key player in helping the state achieve its dream 2045 goal to achieve 100% conversion rates.

It seems impossible at first but totally achievable, and you can tell that the government is ready to help make it happen.

How Much Are Solar Panels in Illinois? Cost of Solar Panels in Illinois

The first item up for discussion is the cost of solar panels in Illinois because you will have to pay for it in one way or another.8 So how deep in your pockets do you have to go to be called a solar panel owner?

What you need to buy the equipment and have it installed in your home can be anything between $13,000 to $17,595, but on average, $15,300 will do.

What this means is that you will have to have about $3.06 for every watt you install. Note that these are only general numbers and that you can easily spend less if you factor in the size of the system, the quality of the equipment, and several other factors.

But still, remember that the same way that the price can go down is the same way that it can escalate; it all depends on what you are really going for.

The general rule of thumb when it comes to all matters concerning the cost of solar panels in Illinois is that the more you need, the more you will spend. If you usually expect a giant energy bill at the end of the month, it only makes sense that you will find yourself spending more to install the panels.

Factors Affecting the Cost of Solar Panels in Illinois

You are thinking it and probably so is any other prospective solar panel buyer, why are solar panels so expensive?

Look at it this way, it may cost a lot of money upfront, but imagine how much you will save in the long run.

Long-angle shot of solar panels on flat roof with the sky on the background.

(Image: Asia Chang18)

10 or 15 years down the line, you will thank yourself for making the decision when everybody else may be complaining about high utility costs and the solar panels are even more expensive by that time.

The good news is that the cost can go down if you play your cards right and consider the following factors:

The Size of the System

This has got to be one of the most important determinants of how much your installation will cost you. Simply put, the bigger you go, the higher the cost of solar panels in Illinois.

If your energy needs are higher, it will basically mean that you will need more panels and a generally more intricate system and no doubt pay more.

Solar Panel Quality

Next up, and something you should never take for granted is the quality of the product.4 With a myriad of solar companies in Illinois.

You don’t want to fall prey to cheap, ineffective products. Yes, they will cost less, but what if they break down in a few years and you have to replace them?

The Solar Companies Doing the Job

Each solar company has specific products and there is no way that you will find identical versions.9 Each comes with its own price tag and it is solely upon you to sift out the panels and equipment to find out which one of them you will go for.

Here is where you will save some or lose some, it all depends on your choice.

The Type of Installation

You should know that there are various ways to install solar panels, it can either be on the roof (the most obvious), on the ground, or on a carport.

Attaching on the roof is the simplest and cheapest way to go, but what if your roof cannot support the panels? You will have to resort to ground mounting, which will unfortunately cost you more.

The Type of Roof

Another aspect that many new customers tend to ignore is their roof type. You would think that it doesn’t matter but it is crucial, depending on the material because it is the one to determine how the racking process will go.

All those who know how to install solar panels on roof will tell you that there is a lot more to it. If you have a special roof, sadly, you will have to pay more for special equipment to effectively anchor the panels.

Solar Panel Cost Calculator Illinois: How Does It Work?

Cost calculators are secret weapons to help you estimate the cost of solar panels in Illinois even before going to an installer for a quotation. It feels great knowing what your budget should look like because it kind of gives you bargaining power and ultimately an upper hand when it comes to negotiations.

So how does the cost calculator work? Pretty simple.

All it expects from you is to insert accurate details about your address, the size of the installation that you expect (the modules multiplied by their size in watts), how much energy you use, and several other concerns based on how the software is designed.

With as little as a single click, you can receive an estimate, after which you can be able to tell whether you can afford it or not. But remember this, the results from the calculations should not be taken as is, at least not always.

The real figures are with your installer and the wisest thing is to still obtain their quotes regardless of the results.

How Much Can You Save After Installing Solar Panels for Home in Illinois?

By now, we have established that the upfront costs of solar panels in Illinois are not as overwhelming as they seem.

Solar panels arranged in rows on a level ground surface.

(Image: Kelly19)

When you put into consideration just how much you would have otherwise used on utility bills over more than a decade, you will realize that it is the right call.

If you can afford it, or get financial help to facilitate it, you should take the leap, and you will thank yourself for that in due time.

Saving money is one of the top benefits of going solar,10 and if you do the math, this is the money that you can direct to other personal projects of yours. By reducing or terminating how much energy you take from the grid, you can lower or eliminate your monthly utilities, and there are numbers to prove that.

Illinoisans can save as high as $28,900 over the entire course of 20 years and that is not even the most exciting part. If you have a payback time frame of about 7-10 years, you can imagine how much savings you will make as soon as the panels pay for themselves.

While others pay for grid electricity, you will be comfortable obtaining power for free, savings thousands every year, fascinating right?

Illinois Solar Rebates: Illinois Solar Incentives

The truth is that the transition to solar power, or any other renewable energy for that matter, can be pretty expensive. The best you can do is to squeeze your budget as much as possible and rely seriously on all the tax credits and rebate programs that you can get.

The great news is that there are Illinois solar incentives that you can fall back on that will help reduce the cost by a significant margin; take a look at what this means.

Federal Solar Investment Tax Credit (ITC)

You should know this, as every prospective solar system owner should know. If you are a tax-paying US citizen, you are eligible for the federal solar tax credit, and it applies to each and everyone, regardless of where you live, no matter the state, and Illinois is not left out on this one.

It might be one of the most lucrative incentives, and why, because it is vast, imagine 30% cost off your total solar panel installation. The amount goes to your tax credit next time you file your taxes.

It should be the first on your list when you are applying for a solar tax credit. Simply fill out your Form 1040 along with IRS Form 5695 to avail the tax credit.17

So far, as you can tell by its popularity, it has been a huge contributing factor to the country’s conversion agenda. It has come in handy in the creation of thousands of jobs in the solar power sector and has also brought in a lot of money, in billions, to the economy.1

Illinois Shines

One impressive thing about Illinois is that it is one of the few states that is mindful enough to offer SREC (Solar Renewable Energy Credits) to its people, in other words, also called the Adjustable Block Program.

It kicked off in January 2019, and it is interesting that it was such a huge success that all the funding ran out by 2021, after which it kind of stopped operations.

Luckily, it came back bigger and better by the end of that year, all thanks to the Climate and Equitable Jobs Act.11

There is no doubt that this program is a big deal, and it is evident by the fact that there is a long wait list that you have to apply for it on their website before you can qualify.

Illinois Solar for All (ILSFA)

ILSFA is here to the rescue for households that cannot afford the full cost of installing solar panels. This program is basically divided into three parts or, in short, targets three groups of people, distributed generation, community solar, and nonprofits or public facilities.

It is mainly for these groups, as long as they are low-income and cannot pay for the panels.

If you are eligible for the program, you get the chance to partner with ILSFA vendors, and, in turn, be able to receive solar installations, all in exchange for a very low fee for the power you receive.

For eligibility, the rule is that the household must be making less than 80% of the median income of the people living in the area.

Net Metering

This is another renowned program that takes place all over the country. “Where did it come from?” You ask.

Well, it is thanks to the policies requiring utility companies to embrace more renewable energy, and what better way to do that than to get solar from the residents?

So, what happens, is that the solar panel owners get into an agreement with the utility companies.

Map showing locations of solar plants in Illinois using yellow markers and Illinois solar panels with a US cut out showing the location of the state of Illinois.

If you have solar power, you can connect to the grid, which will put your surplus energy into good use, that is, instead of letting it go to waste.7 What do you get in return?

Not only will you receive compensation in terms of credits, but you will also be one of the people supplying your local area with electricity.

Note that residents are not obligated to sign up for net metering, and, if you like, you can also detach completely from it and use the power for yourself.

But since this means that you won’t have power at night, you will have to find a battery to store the excess power for use when you cannot rely on the sun’s rays.

Commonwealth Edison Solar Rebates

Commonwealth Edison or more popularly known as ComEd, also boasts of providing Illinois solar incentives. It is the largest utility company in the state and focuses more on offering rebates to those with solar power installed.

Nonresidential systems are eligible for rebates of up to $250 for every kilowatt capacity, and you are in luck if your system has over 2,000 kW because it obviously means more rebates.

Property Tax Breaks

As if the above incentives are not enough, Illinois goes a step further for its residents, offering them state tax exemptions. Before you wonder how this applies to this list, think of it as a tax credit.

Does solar increase home value? Yes.

And what happens to the property tax when the house’s value increases? You will also be obligated to pay more taxes, and here is where the incentive comes in.

The state doesn’t increase your taxes, and you don’t have to pay the extra money according to your house’s new value.2 This tax rebate offers a way that allows you to save money,12 and note that it applies to both active and inactive solar systems.

Federal Solar Tax Credit Is One of the Best Illinois Solar Incentives

Solar rebates from the government have so far proven to be effective, without a doubt. You can easily tell from the statistics that the country is gradually moving to solar power, and the rebates have a lot to do with it.

The federal solar ITC is one excellent example of being the most highly sought-after incentive in Illinois, in fact, the entire country.

Federal energy credits are given only to the country’s tax-paying citizens, and it is a clever way to get more people on board while helping them save more money.

You may wonder, how does this program even work? It is not as complex as it may first seem. Basically, the government rewards your conversion by offering a huge credit to your income tax, by a whole 30%.

On average, the Illinois credit stands at around $6,000, which is a lot of money if you come to think of it, given the total installation cost.

One of the most popular questions from new applicants is usually, how does the solar tax credit work if I don’t owe taxes? The system is specifically created for the taxpayers, or people with a tax liability.

Therefore, as unfortunate as it might be, if you don’t owe taxes, you cannot apply for the program.

How Does Illinois Solar Program Illinois Shines Work?

The Illinois Shines program is the state’s SREC, where the residents receive credits in accordance with the amount of power their system produces. These energy credits will later come in handy when you want to sell them for profit.

A Building for employee housing in Grand Canyon National Park showing solar panels mounted on the roof.

(Image: NPS photo by Michael Quinn21)

Usually, the program offers a credit per 1,000 kWh, which you will later realize is roughly the amount your household can generate in a month.

This is how it will work. First and foremost, find a reputable company that knows all the nitty-gritty of the SREC program, and once you are all set, you will easily be able to receive the credits.

You have the option of cashing out in 7 or 15 years, but the rules usually vary based on the region and the current regulations.

How Does Illinois Solar for All Work?

The ILSFA program is a game changer in the solar industry based on the fact that it allows those who cannot afford it to own solar systems. It is a perfect design for households earning below 80% of the median income, and there is no catch or upfront cost.

The only rule is that you pay a small amount for the service, which is lower than the everyday utility costs. The Illinois Solar For All works for those who cannot in any way finance the installation,13 whether from cash or solar loans.

So, what are the numbers? Let’s say that utilities cost about $90, and the panels can offset half of that, if you carefully run the numbers, you will realize that the program will save you way over $10,000 in the first two decades.

How Does Illinois Solar Property Tax Exemption Work?

The property tax exemption doesn’t exactly mean that you won’t have to pay taxes after installing solar panels; it is far from it. You will still have to pay, but the exemption prevents the rate from increasing following the home improvement you have just made.

You see, when you install panels, your home’s value increases, and logically, this should mean that your tax property tax should also follow suit and increase.5

Luckily, the tax exemption steps in to ensure that you won’t be obligated to pay more only because you have converted.

To put it more in perspective, if your property tax stands at 2.16%, and the installation costs you around $20,475, having the exemption means that you will save a whopping $8,845 all through the lifespan of your solar system.

How Does Net Metering Reduce the Cost of Solar Panels in Illinois?

Illinois net metering is like any other program from other states in the country. It may not initially seem like other regular incentives and rebate programs, but it comes in handy in one main way, helping you save a lot of money.

To put it more simply, signing up for it can ensure that you completely offset your utility bills, or at least significantly reduce them.

When you make full use of the program and maximize your energy savings, there is no faster way to reduce the payback time of your solar system.

The more you save, the shorter it will take for the panels to pay for themselves, and that is practically how net metering helps reduce the cost of solar panels in Illinois.

Every kWh the grid receives from you comes back to you, and you don’t have to pay for the energy in the form of utilities. All the credits can pile up all through the year but remember that the guidelines for the program are known to keep changing, and you should always be prepared for anything.

How Does Illinois Solar Incentives for Low Income Communities Work?

Illinois is one of the states that is proud to offer solar incentives to low-income communities. Instead of letting them shoulder the costs of panels, the program installs everything for them at no cost at all.

Aerial shot of a solar farm spanning across a vast expanse of lush green grass.

(Image: Derek Sutton22)

All that they have to do is pay a small fee at the end of the month, money that you will realize is much lower than the common utility bills.3

Another incentive that can work for low-income households is community solar Illinois.14 This is perhaps one of the cleverest ways to ensure that the residents in a specific area can access solar power and don’t necessarily have to install panels on their roofs.

This is quite different from individual solar power ownership, where each system serves just one household.

In this one-of-a-kind case, the solar system is able to serve the entire neighborhood. It is particularly handy when there are factors hindering panel ownership.

Let’s say you cannot afford it, are renting the property, or don’t have enough room for the panels in your urban setting. It works almost like the grid, but the advantage it has got over it is that it is cleaner and more affordable.

Benefits of Solar Power Illinois

Illinois is not a bad place to set up solar panels, and if you ask other residents that converted to renewable energy, they will surely have glowing reviews about it. Besides, Illinois boasts plenty of sunny days, which is what you should also consider before installation.

At 198, the average number of sunny days in Illinois is only slightly lower than the national average of 205.

Map of the state of Illinois with each county colored to show the daily peak sun hours in each Illinois county ranging from 4.03 to 4.47 daily hours of sunlight.

It puts it in a great position to set up solar panels because you are certain of so many sunny days. You are even more in luck if you live in places like Moline and Cairo, which have 201 and 217 sunny days, respectively.

But still, most places experience a lot of sunshine, like Rockford and Peoria, at 191 and 192, respectively.

Apart from that, if you want to know what you will be signing up for by installing the system, take a look.

You Will Be Caring for the Environment

By now, you understand the dangers of over-relying on fossil fuels. You know what it means for the environment now and for the coming generations.

Solar power and other renewable energy alternatives are the future because they are kinder to the planet and, thankfully, don’t emit as much emissions.

The carbon footprint solar panels is also surprisingly low, and even the emissions are only during the process of manufacturing.

Besides, if you are worried about what happens to old or broken panels, you will be glad to know that there are recycling companies all around Illinois that handle the waste. You don’t have to worry about them ending up in landfills and harming the environment.

It Is the Perfect Chance To Take Advantage of Illinois Solar Incentives

One of the reasons why more and more people are adopting solar power is the fact that the cost of solar panels in Illinois is significantly lower now, all thanks to rebates and tax credits.

Applying and qualifying for federal and local incentives can be quite a relief, and you may end up paying only a small fraction of the installation cost in one way or another.

You Are Sure of a High ROI

Solar power is a huge investment and is lauded for having quite a huge return on investment;15 ask solar farm owners. Besides setting it up for commercial purposes, it will also be of benefit to your residential property because it means an increase in your house’s value, which is fantastic if you have plans to resell your home.

The savings you make instead of paying for utility also count a lot as a high ROI.

Related Reading: Investing in Solar Farms vs. Solar Stocks: Guide to Solar Income (Calculator)

It Is Cheaper Than You Thought

The upfront cost may startle you but don’t fret because Illinois solar incentives have your back. The cost has proven to go down over the last the previous decade, and experts credit this to the rebate programs that have got more residents finally considering converting.

In addition to that, the competition in Illinois solar market has increased, meaning company expansions, the creation of more jobs, and, more importantly, a reduction in the cost of panels.

How To Find the Best Solar Panel Illinois

If you are a first-timer when it comes to solar installation, you will need all the time you can get. The last thing you want to do is settle for a system that is not right for you, which can easily happen if you don’t do your due diligence or are on a very tight budget.

Low-angle shot of solar panel system installation on the rooftop of a building in the dusk.

(Image: Biel Morro23)

For such a huge investment, you need to be very patient. First, you should ensure that what you purchase meets all your needs.

It must be able to handle all your household needs and, as such, be big enough if you need more power. If you want to be sure, you can either check online panel cost calculators or for more accurate details, consult with a reliable solar company for a quotation.

Another mistake you want to avoid is not checking your roof’s condition. It is very crucial to know whether the panels will receive sufficient light or not, that is based on the roof’s slope.

The setup should also not be in a shaded spot; otherwise, it will defeat the whole purpose of harnessing the sun’s rays.

How To Choose the Best Solar Panel Installation Company in Illinois

The installation company you go for is undoubtedly one of the best decisions you can make as a prospective owner of solar panels. Why?

Because it is the line between getting low or high-quality products and getting affordable or overpriced ones, this makes it a very critical part of the entire process.

So what should you do to make sure that your decision is more informed, one word, research.

You should never be in a hurry when picking the company. You can start by asking around for referrals and getting honest reviews; after that, the next thing is to get quotations solely for comparison reasons.

Sometimes, companies charge extra for systems that work almost the same, and you want to save as much as possible.

A solar panel worker holding a drill showing how to install solar panel systems on a roof.

(Image: Markus Spiske24)

Another trick that you should have up your sleeve is knowing how to check for quality products using the warranty, power rating, and efficiency.16

Trust that you don’t want to end up with a product that lasts only a few years and cannot handle all the everyday pressures. Going for a reputable company helps avoid such mishaps, and you will be sure that your panels will last way over the 20-year mark.

Does Illinois Free Solar Program Exist?

Like any keen Illinoisan, you may be wondering how to get solar panels for free. It is an excellent question because maybe, you won’t really have to worry about the high upfront cost and will find a more convenient way to own the panels.

But sorry to break it to you, there are no free panels. Unless you are talking about grants, there is no way that you can get panels for free on your residential property.

But what about the adverts and salespeople pitches about free panels, are they cons? Well, not exactly. You can get panels installed for free, all thanks to signing up for solar leases.

In this case, you will pay the solar contractor a specific fee at the end of the month. It is a bit like assuming that the company is your utility provider.

As you can see, there is no such thing as free in the solar market, so don’t fall prey to such claims.

Is Solar Panel Cost in Illinois Worth It?

Are you a prospective solar system owner and are struggling with the question, are solar panels worth it in Illinois? There are many more residents like you out there asking the same thing, and the answer is and will always be yes.

This is particularly true for Illinoisans based on what you have read so far. Take into account all the attractive incentives available from the federal to the local rebate programs.

Solar panels mounted on racking situated on a flat grassy ground with trees in the background.

(Image: Western Pennsylvania Conference – United Methodist Church20)

You cannot possibly regret converting to renewable energy unless you are okay with paying the hefty monthly utility bills.

You can avoid relying on the grid for power, which also gives you a sense of security in case of weather interference and power outages. You can use your panels for all your needs and store the excess for later use.

The payback period for solar panels in Illinois doesn’t go beyond 12 years, which means that your panels will pay for themselves in no time.

You will have more time to enjoy free power and in the process, save a whole lot of money that you would have otherwise paid for grid electricity.

Illinois is slowly turning to renewable energy, and it should be making significant progress within a very short time. You can also play your part to help your beloved state achieve its goals, and it starts with taking a leap.

Forget about the high upfront cost because still, there are lucrative government and local incentives that can help make the system more affordable for virtually all residents.

Although there are no specific statewide solar tax credits, the federal solar ITC still exists, and it is here to stay.

Apart from that, you are also free to make full use of the Illinois solar incentives, all in a bid to reduce the cost of solar panels in Illinois.

Frequently Asked Questions About Illinois Solar Incentives

What Are the Illinois Solar Incentives?

Illinois boasts of several solar incentives for the residents to enjoy, but the federal solar ITC is by far the most attractive, offering 30% of rebates but still, you get to make good use of other local programs in the state, like Illinois Shines, Solar For All, ComEd rebates, and net metering. All these are handy ways that can help you reduce the cost of solar panels.

Is There a Statewide Illinois Solar Tax Credit Program?

Unfortunately, Illinois doesn’t have a statewide tax credit program. Although the state has made major strides to find various ways to make panels more affordable for the residents, it is still not there yet in terms of offering tax credits so for now, you will have to take advantage of the tax credits from the government, which is not bad at all.

How Does the Illinois Power Payback Program Work?

The Illinois power payback program works just like net metering. When you sign up for it, you can be able to receive credits for each and every megawatt your solar system produces, which can be of really great help to you and your household.

What Factors Affect the Cost of Solar Panels in Illinois?

There are several factors that come to play when determining how much your panels will cost. The most crucial aspects to note include the size of the entire system, the quality of the equipment, the solar company you have contracted, and whether you make use of the solar incentives in the state.

Are There Free Solar Panels Illinois?

Unfortunately, there are no totally free solar panels in Illinois or any other state. The “free” panels you hear about are actually products of solar leases, which are services that you will have to pay for monthly.


References

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18Asia Chang. Unsplash. Retrieved from <https://unsplash.com/photos/Yr-PvhKiorM>

19Kelly. Pexels. Retrieved from <https://www.pexels.com/photo/solar-panels-in-a-solar-farm-9229392/>

20Western Pennsylvania Conference – United Methodist Church. Flickr. Retrieved from <https://flic.kr/p/WxsaDo>

21NPS photo by Michael Quinn. Flickr. Retrieved from <https://flic.kr/p/2jp9mU6>

22Derek Sutton. Unsplash. Retrieved from <https://unsplash.com/photos/rfgsYFb_5ow>

23Biel Morro. Unsplash. Retrieved from <https://unsplash.com/photos/HCha-UHkIg8>

24Markus Spiske. Unsplash. Retrieved from <https://unsplash.com/photos/rNn_TU8dvoY>