2023 Solar Incentives Guide for Palatine, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Palatine.
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 Palatine?
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
The term "solar incentives" refers broadly to financial incentives implemented by the government and by solar companies to encourage people to use renewable energy by making installing and using solar panels more affordable. Solar incentives can include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are provided by the federal government, some by the Illinois government and some by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce over a threshold (normally small) amount of electricity will qualify for SRECs or other similar performance-based incentives. SRECs and the like are typically offered by your state government. When you receive an SREC, you can sell it to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
- 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.)
- Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually come off your total price before tax credits are calculated.
- Tax Exemptions: These can come in the form of property tax exemptions, which allow you to exclude the value of your solar system when paying taxes on your house. You may also qualify for an exemption on sales tax at the time of purchase.
- 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 Palatine utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other places you may make back a percentage of the value.
Federal Solar Incentives
When you think about solar incentives, you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC provides you with a tax credit for a predetermined percentage of the cost of your solar system.
The ITC applies towards 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. This credit can apply towards solar panels 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 amount you can claim.
Talking to your local Palatine solar panel installation expert is the best way to learn more about how the ITC applies to you.
The ITC was both renewed and expanded by 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 apply for a 30% credit for solar systems that began installation on or after January 1, 2022 and will be done by December 31, 2032. The credit will then see a slight annual decrease until it expires. Starting in 2023, it will also be easier to qualify for credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. Your local Palatine solar panel installation experts can answer any questions you have and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
Tax credits, rebates and more might be provided at multiple levels. In addition to federal solar incentives, there are often state and local ones as well. Incentives may be handled by your county or municipality, or by the state of Illinois. Some incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Palatine
Solar energy use nationwide has gone up tremendously in the past 15 years, in part thanks to the increase in availability of solar incentives. You can obtain these incentives from your local utility company, the Illinois government or the federal government. Your local Palatine solar panel installation expert can help you learn more about which incentives you may qualify for, and get you feeling good about making the change to renewable energy today.
EcoWatch's Palatine, 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.