2025 Solar Incentives Guide for Carbondale, IL - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in Carbondale?

Source: https://www.dsireusa.org/

The phrase "solar incentives" refers broadly to financial incentives put in place by solar companies and the government to encourage increased use of renewable energy by making the installation and use of solar panels more affordable. You might qualify for several types of incentives, such as cash back, discounts or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of Illinois and others from the federal government. Some solar incentives you might qualify for are:

• Net Metering: Be sure to speak to your Carbondale utility company about signing a net metering contract. This allows you to receive credit towards your utility bill every month for the value of excess energy generated by your solar panels. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar system. Property tax exemptions allow you to ignore the value added by your solar system when you're calculating the amount of property tax you need to pay.
• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a threshold (normally small) amount of electricity can qualify for SRECs or other similar performance-based incentives. SRECs and similar incentives are typically offered by your state government. You can sell SRECs to your utility company or another buyer, and this is usually considered part of your taxable income.
• Rebates: Rebates, or cash back after a purchase, are typically applied before any solar tax credits are calculated. Solar rebates might be offered by your local utility company, by your county or by your state.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives may be the first thing that comes to mind. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a percentage of your solar system's cost.

The ITC can be applied to the total cost of solar panel installation, including the panels themselves as well as equipment, accessories and labor. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence that you own, as long as it is located in the United States. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.

Your local Carbondale solar panel installation expert can give you more information about the ITC and how it applies to your situation.

The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The new Clean Energy Credit is valid until 2035. Homeowners can now receive a 30% credit for solar systems installed between January 1, 2022, and December 31, 2032. The credit will then see a slight annual decrease until it expires. The expansion to the program also makes it easier to get credit for energy storage systems, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. Your local Carbondale solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it will apply to you.

State & Local Solar Incentives

Rebates, tax credits and more might be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. Incentives may be handled by the state of Illinois, or by your county or municipality. Some incentives are available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Carbondale

You can receive solar incentives from the federal government and the Illinois government, as well as from your local utility company. Growing availability of solar initiatives over the last 15 years has helped greatly increase nationwide adoption of solar energy. If you're ready to make the switch to solar energy, reaching out to your local Carbondale solar panel installation expert is an excellent place to start.