2023 Solar Incentives Guide for Naperville, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Naperville.
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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What Solar Tax Credits, Incentives, and Rebates are Available in Naperville?
Special Assessment for Solar Energy Systems
ComEd - Energy Efficiency Program for Residential
Air Purifier: $50
Clothes Washer: $50
Electric Clothes Dryer: $50
Room Air Conditioner: $25
Refrigerator/Freezer Recycling: Free pickup and $50, plus an additional $10 if recycling a room A/C at the same time
Heating & Cooling
Air Source Heat Pump: $400 - $600
Central A/C: $300 - $600
Ductless Mini-Split Heat Pump: $400
Geothermal Heat Pump: Up to $6,000/home
Furnace Blower Motor (ECM): $50 - $100
Advanced Power Strip: $10
Air Sealing: Up to $400/home
Attic Insulation: Up to $300/home
Duct Sealing: Up to $500/home
Lighting: In-store discounts, varies
Pool Pump: $275
Smart Thermostat: $100
Wall Insulation: Up to $400/home
Solar Renewable Energy Credits
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to mitigate the cost of installing solar panels on your home. Financial incentives like these are designed to encourage more homeowners to switch their home over to renewable energy. You might qualify for several types of incentives, including cash back, discounts or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the Illinois government and others from the federal government. You might qualify for any of the following types of solar incentives:
- Tax Exemptions: Your solar system may qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you ignore the value that solar panels add when you are calculating property taxes on your home.
- Rebates: Solar rebates may be offered by your local utility company, or by your county or state. These rebates are essentially cash back that is applied after you pay for solar panels and before tax credits are calculated.
- Net Metering: Net metering becomes relevant once your solar system is up and running. If you've signed a net metering agreement with your Naperville utility company, it will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other areas you might get refunded a percentage of the value.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the government.
- Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for cash that typically becomes part of your taxable income. Typically, there is a small threshold of energy production to meet before your solar system qualifies for SRECs or similar performance-based incentives. Incentives like these are normally handled by your state government.
Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when thinking about solar incentives. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a specified percentage of the money you spend on your solar system.
The ITC can be applied to solar systems installed after January 1, 2006 and under this program you can deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. You can receive this credit for a solar panel system installed on a primary or secondary residence in the United States that you own. Originally, you could claim 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.
Curious how the ITC might apply to your specific situation? Reach out to your local Naperville solar panel installation expert to get more information.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). Homeowners can now qualify for a credit equal to 30% of the total solar system installation costs for projects started after January 1, 2022 and completed before the end of 2032. This percentage will then 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 this new program.
Click here to learn more about the new Inflation Reduction Act. Your local Naperville solar panel installer can answer your questions and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
Not all solar incentives are federal; rebates, tax credits and more may be offered at the local or state level. Incentives may be given by your county or municipality, or by the state of Illinois. Certain incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Naperville
The expanding 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. Your local Naperville solar panel installation company can help you learn more about which incentives you might qualify for, and get you started on the path to switching to renewable energy today.
EcoWatch's Naperville, IL Solar Incentives FAQs
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.