2023 Solar Incentives Guide for Washington, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Washington.
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
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What Solar Tax Credits, Incentives, and Rebates are Available in Washington?
Special Assessment for Solar Energy Systems
Solar Renewable Energy Credits
Wabash Valley Power Association (28 Member Cooperatives) - Residential Energy Efficiency Program
Variable Speed Pool Pump: $250
Air-Source Heat Pump: $250 - $750
Geothermal Heat Pump: $1,500
Heat Pump Water Heater: $400/unit
HVAC: Varies depending on ZIP code. See program website
Corn Belt Energy Coop - Residential Energy Efficiency Rebate Program
Pool Pump: $250/unit
Air Source Heat Pump: $250 - $750/unit
Heat Pump Water Heater: $400/unit
Geothermal Heat Pump: $1,500/unit
Federal Residential Renewable Energy Tax Credit
Solar incentives are meant to encourage homeowners to switch their home over to renewable energy by providing incentives meant to lower the financial burden of solar panel installation and use. You might qualify for various 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. Types of solar incentives might include:
- Rebates: Solar rebates can be provided by your local utility company, or by your state or county. These rebates work as partial refunds that are applied after your purchase of solar panels and before tax credits are calculated.
- 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 is eligible for SRECs or other performance-based incentives. These kinds of incentives are normally handled by your state government.
- Net Metering: Net metering factors in after your solar panels are up and running. If you've signed a net metering agreement with your Washington utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this is a dollar-for-dollar credit, while in other places you may be refunded a percentage of the value.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
- Tax Exemptions: Tax exemptions can come in one of 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 home.
Federal Solar Incentives
When thinking about solar incentives, you likely think of federal incentives first. A federal incentive many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a predetermined percentage of your solar system's cost.
The ITC initially applied to 30% of the total cost of installing solar panels, although that number has fluctuated slightly over time between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total installation cost includes the panels themselves as well as the cost of labor, equipment and accessories. There is no maximum amount you can claim. The ITC applies to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.
To more fully understand how the ITC might apply to you, contact your local Washington solar panel installation expert 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). The new Clean Energy Credit extends until 2035. Homeowners are now eligible 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 total credit will then be decreased by a few percentage points every year 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. The easiest way to understand how the new Clean Energy Credit applies to you is to talk with your local Washington solar panel installers.
State & Local Solar Incentives
There are often state solar incentives available in addition to federal ones. Tax credits, rebates and more might be available at a more local level. 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 Washington
Solar incentives can be provided by your local utility company, the federal government or the Illinois government. The variety of available solar incentives has contributed to a large increase in solar energy use in the last 15 years. When you're prepared to switch over to solar energy, talking to your local Washington solar panel installation expert is a great first step.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries
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- Industry-leading warranty coverage
- Expansive service area
- Some reported communication issues
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EcoWatch's Washington, IL Solar Incentives FAQs
What if I add a solar system to a vacation home, rental property or commercial property? Can I still qualify for incentives?
While we recommend talking to your local solar installer and/or tax professional to fully understand what solar incentives apply to you, many will apply to a second home, as long as it is in the United States and owned by you. There may be other incentives available specifically for commercial properties, depending on the details.
How can I learn if I qualify for solar incentives?
Broadly, solar incentives apply to:
- a new solar panel system
- installed on property you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including those run by the Illinois government or by your county/municipality, could have additional qualifications. Get in touch with your local Washington solar installer to find out what incentives your project will qualify for.
Who installs solar panels near me?
To find the right solar panel installer for you, check out our guide to the top solar companies in Washington.
What are some of the environmental benefits of switching to solar energy?
Solar energy is renewable — by changing where you get your energy, you help reduce the strain on our planet's resources. A solar system can also lower the CO2 emissions from your home by 500 pounds yearly, or roughly 13,000 pounds in 20 years.
How long until the federal solar tax credit ends?
The federal solar tax credit, previously called the ITC and now named the Clean Energy Credit, is scheduled to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
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.