Illinois Solar Panel Installation

See what you could save when you go solar in Illinois.
Enter your address and see how much you can save when you go solar.

How to Use the Solar Calculator

The best way to learn about local rebates, your home’s energy potential, and your eventual return on investment is to use our ModSun Solar Cost Calculator (see above). Enter your home address in the box, then click Check My Roof. You’ll get an instant picture of your roof’s productivity, your average energy expenses, and installation costs in your area—whether you decide to buy or loan. We’ll also provide system size recommendations and information about rebates and incentives you may be eligible for. Just select More Info under each purchasing strategy to learn more, and then connect with a solar pro.

Solar in Illinois

Illinois is currently a leader in the wind power industry, ranking 4th in the United States thanks to strong midwestern winds and government support. It also has a growing solar market due in large part to the adoption of a Renewable Portfolio Standard (RPS). An RPS requires utilities in the state to source a percentage of energy from renewable sources by a given date. A strong RPS is important because it encourages utility companies to promote conversion to renewable energy. That generally means more incentives for consumers in the form of solar power rebates and performance payments when you switch to solar.

Illinois’ RPS mandates that 10% of the state’s energy come from renewable energy by 2015, increasing to 25% by 2025. While this is by no means the most aggressive RPS in the country–Illinois is tied for the 10th best RPS in the nation–it is still a great way of getting the utility companies on board with the move to renewable energy sources. Illinois’ RPS does have a “solar carve out,” which mandates that 6% of its RPS come from solar power. While a move in the right direction, 6% is hardly an ambitious goal. That said, it does give big utilities an extra incentive to purchase solar power from homeowners who produce their own power from solar panels.

Illinois currently has 55MW of solar energy installed, making the state 25th in the nation in terms of installed solar capacity. This is enough energy to power 8,000 Illinois homes, and capacity is steadily increasing as solar energy systems become more affordable. The cost of solar energy systems in the United States has steadily declined–decreasing by 6% in 2014 and by 53% from 2010–making solar much more accessible for residential and commercial customers.

Illinois uses a system called net metering. Net metering requires your utility company to track your renewable energy production and consumption during each monthly billing cycle. Any surplus you produce is carried over as a credit onto your future bills–helpful for periods without much sunshine or if you use more energy than you can produce with your solar energy system. Net metering is required to be available for consumers under Illinois law, unless your electricity is supplied by a cooperative or municipal cooperation. The only “downside” to the net metering program is that your credits don’t hang around indefinitely, they expire. At the end of every annual period all remaining credits expire and revert back to the utility without compensation to the homeowner. To make the most of this system, make sure that your solar system isn’t so big that it generates much more energy than you could ever possibly use.

There are currently more than 261 solar companies at work in Illinois, employing 3,800 people. These companies provide a wide variety of solar products and services ranging from solar system installations to the manufacturing of components used in photovoltaic (PV) panels.

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Notable Solar Energy Projects Throughout the State

  • West Pullman Solar Park in Chicago was completed in 2010. This PV project has the capacity to generate 8 MW of electricity–enough to power over 1,500 Illinois homes.
  • Several large retailers in Illinois have gone solar, most notably Walgreens. IKEA has installed solar energy systems at its Chicago-area stores located in Bolingbrook and Schaumburg. These two solar projects total 248,700 square feet and a generating capacity of 1,989 kW, and were built with 8,463 solar panels. They represent the two largest distributed arrays in Illinois, making IKEA the state’s largest solar owner.
  • At 20 MW, Grand Ridge Solar Plant in LaSalle County is among the largest solar installations in Illinois. Completed in 2012, this PV project has enough electric capacity to power more than 2,700 homes.

Relevant Legislation

  • In June 2014, Illinois enacted H.B. 2427, which released $30 million in the Renewable Energy Resources Fund to the Illinois Power Agency for the purchase of PV power through a supplemental procurement process. Of the released funds, half are set aside for PV systems less than 25 kilowatts in nameplate capacity, such as residential rooftop systems.
  • In August 2007, Illinois enacted legislation (Public Act 095-0481) that created the Illinois Power Agency (IPA). The IPA requires large investor-owned electric utilities and alternative retail electric supplies to source 25% of eligible retail electricity sales from renewable energy by 2025. Electric cooperatives and municipal utilities are exempt from RPS requirements.


Available Incentives and Rebates

Illinois is the 5th most populous state in the nation, and it also has tremendous energy demands. Illinois households utilize 44% more energy than the average U.S. household. Transitioning to an energy system that relies more heavily on renewable resources is absolutely critical to reducing the state’s carbon footprint, decreasing energy costs for consumers, and boosting the state’s economy by maximizing the potential of a relatively new industry.

  • Illinois offers a rebate for all customers of investor-owned utilities, ComEd and Ameren. The rebate offers $1,500/kW back on solar systems, up to 25% of project costs, or $10,000, whichever is less.
  • In terms of tax credits, Illinois doesn’t offer any tax credits for solar power installations.
  • Effective January 1, 2009 the IRS extended tax credits for solar thermal and solar electric systems (PV). Both are eligible for a 30% uncapped Federal Tax Credit. Solar Renewable Energy Credits (SRECs) are new to Illinois this year. SRECs are generated when excess energy is created from clean sources, like solar panels on your rooftop. Utility companies that don’t have the desire or capability to set up their own renewable energy systems will pay you cash for the excess energy you produce in order to meet their RPS targets and avoid paying higher alternative compliance fees to the state. The price of SRECs in Illinois is expected to average $168 in 2016. You won’t get rich from SRECs, but because you have to sign a 5 year contract to sell your SRECs, you will have a regular source of solar income on top of the savings you experience with your utility bills.
  • Illinois has a property tax incentive to encourage solar power use. When you register your solar system with the chief county assessment officer your solar equipment will be valued at no more than the value that would be given to a conventional energy system.
  • Unfortunately, Illinois offers no sales tax exemption for solar energy systems, so expect to pay between 6.25% to 10% of the installed costs. Many states do offer a 100% sales tax exemption, but Illinois only offers it for wind energy installations.

What are Financing Options for Solar Systems in Illinois?

There are three financial options for going solar in Illinois: 1) solar leasing, 2) buying solar with a home equity line of credit (HELOC), or 3) buying solar with cash. Paying cash for your solar energy system leads to the highest dollar-amount returns over time. Taking a HELOC though can allow you to spend thousands less over time, while still reaping a large financial benefit in year one. The reason for this is that you are taking a loan for your system, but you still get all the benefits of paying cash up front including the 30% Federal tax credit, a rebate, SREC sales, as well as significant annual energy savings. All of those incentives combined will allow you to come out so financially ahead in the first year of your system’s operation that even though you’ll be making loan payments for the next 15 years, the windfall from the first year is so large that you’ll never actually have to spend any of your own money.

solar ROI illinois

If you don’t have the equity or cash to put down on a solar energy system, you may want to investigate solar leasing. With solar leasing or a Power-Purchase Agreement (PPA), the solar installation company puts panels on your roof at no cost to you, and you make monthly payments that save you about $10 per month from what you had been paying the utility company for traditional fossil fuel based energy. Your savings may start small, but they’ll finish big, because the lease cost will rise by less than the electric company’s annual rate hikes.

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