2023 Solar Incentives Guide for Centralia, IL - Tax Credits & Rebates

In this guide, we'll cover the latest solar incentives and rebates available in Centralia.

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.
Get a free quote from one of our trusted Centralia solar installers to see how much you can save.

By EcoWatch Local Advisors

Data Analysis: James Savino

Ranking Methodology: Karsten Neumeister

Updated March 14, 2023

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We work with a panel of solar experts to create unbiased reviews that empower you to make the right choice for your home. No other site has covered renewables as long as us, which means we have more data and insider information than other sites. Our rankings are never affected by revenue or partnerships.

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

Special Assessment for Solar Energy Systems

Incentive Type:
Property Tax Incentive
Varies

Solar Renewable Energy Credits

Incentive Type:
Solar Renewable Energy Credit Program
Negotiated with procurement administrators

Federal Residential Renewable Energy Tax Credit

Incentive Type:
Personal Tax Credit
30% federal tax credit for systems placed in service after 12/31/2021 and before 01/01/2033. Good for: solar water heat, solar photovoltaics, biomass, geothermal heat pumps, wind (small), fuel cells using renewable fuels.

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


Solar incentives mitigate the cost of installing solar panels on your home. This category of financial incentives is in place to encourage more homeowners to switch their home over to renewable energy. Various kinds of incentives, including discounts, cash back or credit towards your monthly utility bill, may be available to you. Certain incentives may be handled by the state of Illinois, by your utility company or by county or municipality, while others are federal. Some solar incentives you might qualify for are:

  • Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you've signed a net metering agreement with your Centralia utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other places you might be refunded a percentage of the value.
  • Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (This is different from a tax deduction.)
  • Tax Exemptions: Your solar panels might qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to exclude the value that solar panels add when calculating property taxes on your house.
  • Rebates: Your solar installer might help you claim a rebate, or partial refund after purchase, for your solar system. Counties or states will also sometimes offer limited-time rebates. If you receive a rebate, that amount will usually come off your total price before any tax credits are calculated.
  • Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a specific (usually small) amount of electricity qualify for SRECs or other performance-based incentives. SRECs and similar incentives are typically offered by your state government. When you receive an SREC, you can sell it to your utility company or another buyer, and this is usually considered part of your taxable income.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge of. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a predetermined percentage of the cost of your solar system.

The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar system has to have been installed after January 1, 2006 on a property owned by you for you to claim the credit. The ITC initially covered 30% of all installation costs (panels, labor, accessories and equipment), although the amount has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the amount you can claim.

Have questions about how the ITC applies to your specific situation? Get in touch with your local Centralia solar panel installation expert to get more information.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now referred to as the Clean Energy Credit. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners can apply for a credit equal to 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit ends in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems under the new laws.

Click here to learn more about the new Inflation Reduction Act. Your local Centralia solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

Rebates, tax credits and more might be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. These incentives might be distributed by the Illinois government, or by your county or municipality. Some are ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Centralia

There are many kinds of solar incentives: those given by local utility companies, those given by the federal government and those given by the Illinois government, to name a few. The use of solar energy has grown tremendously in the last 15 years, thanks to these incentives. If you're prepared to make the change to solar energy, talking to your local Centralia solar panel installation expert is an excellent place to start.

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SunPower

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EcoWatch's Centralia, IL Solar Incentives FAQs

What if I am planning to add a solar system to a vacation home, rental property or commercial property? Will I still qualify for incentives?

Many solar incentives are intended to apply to a property located within the United States that you own, and most secondary residences fall under this distinction. There may be other solar incentives available for commercial properties, depending on the specifics. We recommend speaking with your local solar installer and/or tax professional to better understand what incentives apply to your specific situation.

How much can I save annually on my electric bill if I install solar panels on my house in Centralia?

Once you add solar panels to your home in Centralia, you can anticipate savings of approximately $837.34 per year, or approximately $15,909.42 over the next 20 years.

What are some of the environmental benefits of switching to solar energy?

You can lower your carbon footprint by 500 pounds of CO2 annually when you switch to solar panels. This adds up to roughly 13,000 pounds over 20 years. Solar is also a renewable energy source, which means that making the switch reduces the drain on our planet's resources.

If I trade in my appliances for ones that can use solar energy, are there any benefits I can claim?

The new Inflation Reduction Act introduces multiple incentives meant to reward homeowners for making eco-friendly upgrades. Some of these incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.

Can I qualify for incentives both towards the up-front cost of solar panels, and later as reimbursement?

The order your incentives will be applied in might vary depending on which incentives you are eligible for but usually yes, you can claim multiple types of incentives for your solar project. Get in touch with your solar installer or a local tax professional to verify you are claiming all of the incentives you qualify for and applying them in the correct order.

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.

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