2023 Solar Incentives Guide for Shelbyville, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Shelbyville.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Shelbyville?
Special Assessment for Solar Energy Systems
Solar Renewable Energy Credits
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" covers a range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives may include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered federally, while others are offered by the Illinois government or your utility company, county or municipality. Some broad categories of solar incentives include:
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you've signed a net metering agreement with your Shelbyville utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in other places you may make back a percentage of the value.
- Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to ignore the added value of your solar system when paying property tax on your house.
- Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are usually handled at the state level. Once your solar system meets the qualification threshold (normally a small amount of energy production), you can receive SRECs that can be sold to your utility company or other buyers. The money you receive is usually considered part of your taxable income.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
- Rebates: Solar rebates can be offered by your county or state, or by your local utility company. These rebates work as partial refunds that are applied after your purchase of a solar system and before tax credits are calculated.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that comes to mind when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is the most well-known federal solar incentive. The ITC provides you with a tax credit for a specific percentage of your solar system's cost.
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. This credit can apply towards solar panels installed on a primary or secondary residence that you own in the United States. 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.
To more fully understand how the ITC could apply to you, get in touch with your local Shelbyville solar panel installer and request more information.
The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as renaming it to the Clean Energy Credit). Under the new program, solar installation projects started after January 1, 2022 and completed by the end of 2032 may be eligible for a 30% tax credit. This percentage will then decrease slightly each year until the current Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems under this new program.
Click here to learn more about the new Inflation Reduction Act. Your local Shelbyville solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
There are more than just federal solar incentives; rebates, tax credits and more might also be offered at the local or state level. Some incentives are offered for only a limited time, while others are ongoing. Your local solar incentives could come from the Illinois government, or from your specific county or municipality.
Next Steps for Installing Solar in Shelbyville
You can apply for and 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 increase solar adoption nationwide. We recommend talking to your local Shelbyville solar installation company for more information about these incentives and to be sure that you're getting the most money possible for your solar system.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries
Best Warranty Coverage
- Industry-leading warranty coverage
- Expansive service area
- Some reported communication issues
- No leases or PPAs
EcoWatch's Shelbyville, IL Solar Incentives FAQs
If I already have solar panels, can I still claim incentives?
An excellent idea would be to talk to the company that installed your solar system — or speak to a local Shelbyville solar installer — to learn about which incentives you may qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are the best solar panel installation companies near me?
To discover the best solar panel installation companies near you, read our article on Shelbyville's best solar panel companies.
What are some environmental benefits of adding solar panels to my home?
Solar energy is a renewable energy source — by switching where you get your energy, you help reduce the strain on our planet's resources. Solar panels can also lower your home's CO2 emissions by 500 pounds yearly, or roughly 13,000 pounds over 20 years.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly named the federal solar tax credit, or the ITC), is slated to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I use solar and another type of renewable energy in combination to power my home?
Yes, you can utilize multiple types of renewable energy to power your home — for example, a combination of geothermal and solar. You can also combine renewable energy generation with a backup source of non-renewable energy. Make sure that you discuss your proposed plan with your local Shelbyville solar panel installer, to get an understanding of what will be needed and what incentives you may or may 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.