2023 Solar Incentives Guide for Capital, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Capital.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Capital?
Special Assessment for Solar Energy Systems
Solar Renewable Energy Credits
City Water Light and Power - Residential Energy Efficiency Rebate Programs
Geothermal Heat Pump: $500/ton
Rain Barrel: $25
High Efficiency Toilet: $50
Water Heater: $200 - $400
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The term "solar incentives" generally refers to financial incentives implemented by the government and by solar companies to encourage the use of renewable energy by making solar panels more affordable. Various types of incentives, like cash back, discounts or monthly utility bill credits, might be available to you. Certain incentives may be provided via the state of Illinois, by your utility company or by county or municipality, while others are federal. Types of solar incentives might include:
- Rebates: Solar rebates may be provided by your local utility company, or by your county or state. These rebates work as cash back that is applied after you purchase solar panels and before tax credits are calculated.
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are typically handled at the state level. Once your solar system meets the threshold (generally a small amount of energy production), you are eligible to receive SRECs that you can then sell to your utility company or other buyers. The money you receive from the sale is usually considered part of your taxable income.
- Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits are different from tax deductions.
- Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you have a net metering agreement in place with your Capital utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in others you may receive a refund equivalent to a percentage of the value.
- Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar panels. Property tax exemptions allow you to ignore the value that your solar panels add when calculating how much property tax you need to pay on your house.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have heard of. You may have heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a predetermined percentage of the money you spend installing solar panels.
The ITC applies to solar panels installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Originally, the tax credit was for 30% of the total cost — for panels, equipment, labor and accessories — although the percentage may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the amount you can claim.
Your local Capital solar panel installer can give you more information about the ITC and how it might apply to your situation.
In August 2022, the ITC (now called the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The Clean Energy Credit re-raises the credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After 2032, the percentage will be reduced slightly each year until the end of the program in 2035. Starting in 2023, the expansion to the program will also make it easier to get credit for energy storage systems.
More information about the new Inflation Reduction Act can be found here. Your local Capital solar panel company can answer any questions you have and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
In addition to federal solar incentives, there are often also state ones. Rebates, tax credits and more might be available at a more local level. These incentives might be provided by the Illinois government, or by your county or municipality. Some incentives may be ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Capital
The large number of available solar incentives has helped tremendously increase the use of solar power nationwide over the past 15 years. You can get solar incentives from the federal government, the Illinois government or from your local utility company. Call your local solar panel installer today to find out more information and to save as much money as possible on a solar system for your Capital home.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries (coming 2022)
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
EcoWatch's Capital, IL Solar Incentives FAQs
When does the federal solar tax credit end?
The federal solar tax credit, formerly called the ITC and now titled the Clean Energy Credit, is set to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
If I switch my appliances out for ones that utilize solar energy, are there any credits that I can claim?
Under the new Inflation Reduction Act, there are several new financial incentives that are available when you make eco-friendly improvements to your home. More details on these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I apply for incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can claim both tax credits and rebates towards the cost of solar panels. Depending on precisely which incentives you are applying for, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to ensure that you are claiming incentives correctly and getting the most money you can.
Can I use multiple types of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Be sure to go over your plan with your local Capital solar installer. They can help you plan your project and give you an understanding of various incentives that you might or might not qualify for.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.