Solar Power Rebates, Tax Credits and Solar Panel Incentives in Illinois; 2012 Update
There have been several changes recently to solar power rebates, tax credits and other incentives that effect residents of Illinois.
Illinois's RPS or Renewable Portfolio Standard
Under Illinois's Renewable Portfolio Standard Act ("RPS"); targets have been set at 25% of electricity production to come from renewable energy by 2025-2026. Basically Illinois's RPS is one of the most complicated RPS's I have seen so far; it was some very heavy reading. There have been some recent changes and this pretty much means the smaller power companies are exempt if they have less than 100,000 customers. So as always the best way to know what's applicable in your area, click "here" to get contacted by local solar professionals.
Federal Tax Credit
A significant financial incentive for your solar power system in Illinois is the same Federal Tax Credit that applies right across the USA. This gives you a credit on your Federal Tax bill equivalent to 30% of the cost of your solar system For more information on this visit out page "The 30% federal tax credit for residential solar power systems" Because this is a tax credit you get the benefit of this when you do your next federal tax return, rather than getting a cheque on the day of installation. Still, it has a real value if you are in a position where you are paying annual federal income tax equivalent to 30% or more of the value of your solar panel system.
Illinois State Rebates
Illinois offers a state based rebate on solar power systems and some other renewable energy platforms. It is subject to funding restrictions and at this time applications are due to open for the next round of rebates on 30th April 2012. Rebates are available for residential and business solar PV, the rates are : $2.25/watt or 30% of project costs up to a maximum of $30,000. It is advised that you apply for the rebate before you make your decision to go ahead and install. There is also a Utility run rebate program, City Water, Light and Power are offering customers (residential and commercial) a rebate of $1,500 per kilowatt (kW) and are limited to $15,000 per customer. Funding restrictions do apply so it's a first come first served model. The best way to get the most up to date information on the rebate levels is to use the facility here to get 3, free quotes from installers who service your area and know the state of play with your local utility.
Net Metering means that your electricity provider will monitor how much power you consume from the grid and how much power you generate and send back to the grid. This can be achieved by the installation of a bio-directional meter that separately records what you buy from the grid and what you push back into the grid. The amount of kilowatt hours you feed back into the grid is subtracted from the amount of kilowatt hours you have purchased from the grid in each billing period. So if you used 1000 kwh in a period and sent 300 kilowatt hours into the gird during the day when you weren't using much power at home, then your utility will only bill you for 700 kilowatt hours. Not all utilities give a 1:1 credit of kwh's. Some only give a fractional credit i.e 90%. In this case, on the example above, only 270 kwh would be credited to the customer bill even though they fed 300 kwh into the grid. Illinois's Net metering system is quite complex compared to most others and for this reason the best thing to do is click "here" and we can put you in touch with local solar experts who know the current state of play in your area. The real value of net metering is that the value you get for the power that you feed back into the grid will increase in time as the retail price of power increases.
Illinois State Tax Exemptions and State Tax Credits
Although you don't get a state based tax credit the good news is that your solar power system is somewhat exempt for property tax, well just like the RPS the property tax is complicated as well. This means although the value of your property has been raised by the solar power install you won't be penalized for it by having to pay higher property taxes.
Illinois Solar Incentives and investment case: Summary April 2012
Illinois has a overly complex system in relation to policy, incentives and rebates. The good part is they do actually have a Renewable Portfolio Standard and Net Metering but the model they have created could be easier to deal with. It's our opinion that a solar power system for your home in Illinois does certainly stack up as a bit of an no brainer. Remember, Warren Buffet's compound annual return on investment over 50 years is only around 20% and with a solar power system you are likely to exceed this within only 5-6 years. From then on the percentage return you get each year just goes up and up as power prices go up and up over the next 30 years