Illinois Solar Incentives (Rebates, Tax Credits & More in 2023)
By Dan Simms /
In this comprehensive guide to the average cost of solar panels in Illinois, you’ll learn:
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The typical homeowner in Illinois can expect to pay around $14,333 for a complete solar system after the federal investment tax credit (ITC) is considered. Before the credit, you can expect closer to $20,475. These totals assume you’ll pay the average local cost per watt of $2.73 and need the average system size of 7.5 kilowatts (kW) required in Illinois to offset your energy bills.
Size is one of the most important factors when pricing your solar system. The table below provides a quick look at what Illinoisans pay for solar equipment based on the sizes they need to offset their utility bills.
|Size of Solar Power System||Total Cost in Illinois Before the Federal Credit||Average Cost After Federal Tax Credit||Home Size This System is Typically Appropriate For|
|5 kW||$13,650||$9,555||1,200 sq. ft.|
|6 kW||$16,380||$11,466||1,400 sq. ft.|
|7 kW||$19,110||$13,377||1,600 sq. ft.|
|8 kW||$21,840||$15,288||1,800 sq. ft.|
|9 kW||$24,570||$17,199||2,000 sq. ft.|
|10 kW||$27,300||$19,110||2,200 sq. ft.|
|11 kW||$30,030||$21,021||2,400 sq. ft.|
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Homeowners in the Prairie State pay an average of $2.73 per watt for solar panels, which is around 2.6% higher than the U.S. average. As such, your money won’t go as far in Illinois as in most other states when converting to solar.
However, local energy consumption is below average in Illinois. The typical Illinois home consumes around 728 kilowatt-hours (kWh) per month — comparatively, the average home energy consumption in America is 893 kWh.1 If your Illinois home has lower energy needs, you may be able to opt for a smaller solar system size.
Despite the higher per-watt cost, Illinois residents pay less for solar overall — $14,333 — than most Americans — around $16,758.
Watch Below: What Should You Know Before Going Solar?
According to the Solar Energy Industries Association (SEIA), the cost of photovoltaic (PV) equipment has come down by around 53% in the past 10 years.2 This price decrease is thanks to an increase in solar conversion rates in Illinois, as well as advancements in solar technology and manufacturing processes.
While solar prices are decreasing in Illinois, electricity rates have been rising. According to the U.S. Bureau of Labor Statistics, electricity rates have increased by nearly 20% over the past four years.3 The energy price hikes in the U.S. over that same period have been slightly higher, at closer to 21%.
With the cost of solar equipment declining and the price of electricity consistently on the rise, there has never been a more opportune time to convert to solar in Illinois.
Average lifetime savings are already over $16,500 in your area, and that number is expected to climb in the future based on past trends. Recent estimates suggest that utility costs have risen around 24% in the past year alone in Illinois, and future price hikes will likely make solar installation even more appealing.
If you convert to solar in Illinois and pay cash for your system, you can expect your panels to pay for themselves in 12 years and save an additional $16,585 on utility bills, on average.
These savings are conservative and don’t take into account future increases in energy costs. And as we’ll discuss later, taking advantage of local solar benefit programs can increase your savings even further.
It’s important to note that the way you pay for your panels will affect your upfront costs, but it can also eat into your long-term savings. The three primary ways to pay for access to solar are:
We’ll explain how each of these payment options works in the chart below. We’ll also discuss some pros and cons of each option and the average savings you can expect when choosing how to finance your solar system.
|Solar Financing Option||Initial Cost||Average Payback Timeline||Est 25-Year Savings|
|Cash||$14,333 (after the federal solar tax credit)||12 years*||$16,585*|
|Loan||Often $0, although opting for a down payment will reduce your payback timeline and increase your long-term savings||15 years*||$11,500*|
|Lease||Usually $0||N/A (you never own the equipment)||$6,000|
*These are conservative estimates intended to represent base-level averages. In many cases, customers can see an even higher return on investment (ROI) and shorter payback timelines.
Paying for your equipment in cash is the most straightforward financing option. It doesn’t require that you have good credit, and it doesn’t require any additional paperwork to get approved for a loan or a lease.
Cash purchases are our recommended way to invest in solar because they let you avoid financing charges. As such, you’ll experience the shortest payback timeline (around 12 years in Illinois) and see the maximum possible energy savings.
The major downside to a cash purchase is you’ll need to pay the entire cost of your solar system before your panel installation. This may not be realistic for all Illinoisans, who see average installation costs of over $20,000 — keep in mind that the ITC is not applied until you file your taxes after your solar installation.
But unlike other options, like leases, you can make the most of the solar incentives available in Illinois when you opt for a cash purchase.
Below are some of the pros and cons of using a cash purchase to acquire your solar energy system.
A solar loan is a popular financing option for solar PV systems. Provided you get approved for a loan — which requires at least decent credit — this option lets you pay off your system in monthly installments over several years.
Solar financing options — like the BluePower Plus+ program from Blue Raven Solar — are becoming increasingly appealing. Many financiers offer $0-money down options and low interest rates, which help make owning solar equipment more accessible than ever before.
Solar loans are popular in Illinois, where a cash purchase might not be realistic for residents. Instead, most financing agencies and solar panel companies provide monthly payments that sit at or below your current monthly energy charges. For most Illinois residents, that would be around $93.98.
But loans come with interest payments, which means you’ll pay more for your system over time and see lower savings as a result.
Below are some upsides and downsides to choosing a loan for your solar equipment in Illinois.
A solar lease is an agreement you make with a solar installation company to rent an array of panels. In exchange for a monthly payment, you get to use all of the energy produced by the panels to offset your energy charges. A lease essentially lets you swap your utility bill for a slightly lower payment to your solar company.
Solar leases used to be a popular option when large companies like Vivint and Sunrun pitched them. However, they have fallen out of favor as financing options become more accessible.
Leases can still be a good option for individuals who cannot claim the federal credit, as leasing doesn’t let you access that incentive.
Since you’ll never own your panels with a PV equipment lease, you likely won’t see the same savings as you would with other financing options. Your long-term savings are significantly lower — usually around 33% of what you’d see with a cash purchase.
An alternative to solar leases is the Illinois Solar for All program, which provides income-eligible households in Illinois with solar equipment at low or no upfront costs. This local incentive can help you save money and support the clean energy movement by offsetting home energy costs. Note that eligibility for the program is limited, but other state incentives are available.
Power purchase agreements (PPAs) are similar to leases and offer opportunities to avoid putting money down, but they also tend to cost more in the long run.
Below are some of the benefits and drawbacks of choosing a lease to pay for your solar equipment in Illinois.
The best way to ensure you pay as little as possible for your panels in Illinois is to take advantage of solar incentives. Perks like the federal credit, local benefit programs and solar rebates can reduce your upfront and total system costs by thousands of dollars.
Below are some of the best options to keep your installation price down and your energy savings maximized in Illinois:
We’ll explain why each of these steps is important in the following sections.
In our opinion, the best way to pay less for your solar PV equipment is to take advantage of the federal solar tax credit. This perk has been offered by the federal government for years, but thanks to the Inflation Reduction Act, the credit rate recently increased from 22% to 30% of your entire system value.
The credit is applied to your income tax liability for the year your solar system is installed and commissioned. In Illinois, the average credit amount is $6,143. If you can claim the entire credit, you’ll bring down your system total quite significantly. But if you can’t, you can roll over any unused credit to future tax bills for up to five years.
Filing for this credit is also super simple, so it’s well worth your time and energy. You or your accountant just need to include IRS form 5695 when you file your taxes, which is the form for reporting Residential Energy Credits. You only need basic information to fill it out, like the value of your system and your installer’s name and contact information.
You can get a copy of the appropriate IRS form and more information about the incentive on the Department of Energy’s website.4
Illinois residents can also take advantage of the state’s solar renewable energy certificates (SREC) market, called the Illinois Shines program. To help achieve the state’s Renewable Portfolio Standard (RPS) goal — 25% of all energy from clean sources by 2026 — the program incentivizes local utility companies to provide energy credits for solar production.5
If you opt into the program, you’ll earn credits for each kilowatt-hour (kWh) your panels produce, and you can sell those credits on the local SREC market for a profit. You can then put the money you earn toward paying off your solar system. Ultimately, this incentive helps you reduce your repayment timeline and maximize energy savings.
Taking advantage of SRECs is automatic, provided you have an installer who can opt you into a contract.
Another outstanding incentive in Illinois that can help reduce the cost of your PV system is net metering. Also called net energy metering (NEM), this program lets you overproduce energy with your panels and use that overproduction to reduce future bills. This is useful for offsetting utility bills at night or on cloudy days when energy production is lower.
The Public Utilities Commission (PUC) in Illinois mandates NEM for several of the largest utility companies in Illinois. These include:
All excess energy production is credited at the full retail rate, and your credits carry over for an entire year.6
The process of opting into NEM can vary based on your electricity provider, but there is no charge for taking advantage of this perk. You can reach out to your utility company for more information.
Finally, we recommend getting a few different quotes for your solar energy system. Illinois is home to nearly 100 solar installers, all of which charge different prices for their services.7
We suggest requesting free quotes from at least three providers in your area and comparing them based on the overall cost and value provided. Keep in mind that some companies that carry high-efficiency and high-quality equipment — like Maxeon panels and Tesla Powerwalls — will naturally be more expensive.
Most Illinois residents pay between $9,500 and $21,000 for their solar arrays. As you can see by the range we’ve provided, your total cost can vary based on several factors. The best way to get an accurate estimate is to use a customized solar calculator or have an installer provide a quote for you.
We’ll discuss some of these factors below and explain how each one brings your installation costs up or down.
As you may have guessed, the type of equipment you install and the overall size of your system are two of the most significant factors when it comes to price.
All solar systems include solar panels, but not all panels are created equal. Some panels — like Maxeon brand panels — have a higher efficiency than others and are suitable for areas that get minimal sunlight, but they tend to be more expensive than other brands.
Illinois sees an average of 198 sunny days per year, so lower-efficiency panels should still be suitable, which means you could save some money by opting for more affordable panel brands.
Illinois residents contend with severe weather regularly, with intense thunderstorms and tornadoes occurring frequently throughout the year. The state’s climate means power outages are more common than in many other states, so coupling your solar panels with solar battery storage to provide power through blackouts is a good practice.
But note that adding solar battery storage will increase the average cost of your solar system.
Lastly, the number of panels you need — which can depend on many factors — will affect your pricing. You can expect higher costs if you have
The payment method you use for your solar panels can also impact your cost. Paying with cash requires having the full amount of money upfront, but it will also lead to more energy bill savings over time and leave you with the lowest system cost possible.
A solar loan, which most solar customers choose, reduces your up-front payment considerably or entirely, but you’ll end up paying more in interest over time, which will cut into your overall savings.
Illinois has Property Assessed Clean Energy (PACE) programs, which limit interest rates and loan terms for solar loans. Note that PACE financing is only available for commercial customers in Illinois.
But Illinois also has the Illinois Solar for All Low-Income Community Solar program, which seeks to provide access to community solar to allow households with below-average income to get behind renewable energy.
As is the case with other home improvement companies, the company you choose for your solar project can bring your price above or below the average in the area. This can happen for two reasons.
First, every solar installer will have unique pricing for labor, and each company can also charge different prices for equipment. This means the same exact system could cost thousands less from one company than it does from another based on demand, customer service, warranty coverage, upcharges, discounts and more.
Second, not every solar installer offers the same equipment. For example, Windfree Solar, a local solar company in Illinois, installs a variety of equipment brands that you can choose from to suit your budget.
SunPower, a national solar company that services Illinois customers, only installs Maxeon panels. These panels are some of the most expensive in the industry, so choosing SunPower will naturally cost more than choosing a company like Windfree Solar.
It’s important to remember that panels differ in quality and performance, not just in cost. For this reason, it’s best to compare solar panels based on both value and price.
Solar equipment might be expensive initially, but there are no ongoing maintenance costs in most cases.
One of the most common maintenance requests from solar customers is panel removal and reinstallation to address roof repair. In most cases, this costs between $500 and $1,000, although different installers may charge different prices for the removal and storage of your equipment.
Illinois does experience some intense weather, including extreme thunderstorms, some of the deadliest tornadoes in the U.S. and well-above-average rainfall per year.8,9 These conditions can result in more frequent roof damage and leaks, which might require you to carry out roof repair more often than in other states.
In some areas, washing your panels to remove dirt, debris and pollen will help boost efficiency. In turn, this can increase your energy production and savings. Panel washing usually costs between $50 and $100 and is done around twice a year — or you can do it yourself if you’re comfortable climbing onto your roof.
However, most homeowners in Illinois don’t need this service. The Prairie State sees above-average rainfall that should help keep your panels clean.
With nearly 100 solar installers servicing homes throughout Illinois, you can save money by choosing one that provides great value and still fits your budget. Below are some of the best solar panel companies we recommend in Illinois, along with relative pricing information.
|Solar Installer||Average Installation Cost Per Watt ($-$$$$$)|
|Sun Badger Solar||$$|
|Straight Up Solar||$$$|
The EcoWatch team receives plenty of questions from homeowners in Illinois. Below are some of the most common ones we see, along with our responses. If you have specific questions that aren’t answered here, reach out to our team of solar experts at email@example.com.
Most solar power systems in Illinois cost between $13,650 and $30,030 before the federal tax credit or between $9,555 and $21,021 after the credit. This range is broad because many factors impact the total, including the size of the system installed, the size and energy efficiency of your home, your average electric usage, your typical energy costs and more.
The best way to get an accurate estimate for a system suited to your home is to contact a reputable solar installer in Illinois. The company will conduct a full assessment of your home, including sun exposure and power consumption, and provide you with the most accurate pricing possible.
Yes! Solar power systems can be expensive upfront, but they can increase the value of your home quite significantly. This is especially true in a state like Illinois, which has great net energy metering policies, SRECs and other state incentives and rebates.
According to estimates from Zillow, homes with solar panels sell for around 4.1% higher than those without. In Illinois, where the average home value is about $246,760, that means a solar power system can add approximately $10,117 to the value of your house.
One of the benefits of bumping your home value in Illinois is that the state’s Property Tax Exemption guarantees that your property taxes won’t increase from the added value.
Both buying and leasing have their pros and cons, but we almost always recommend buying or financing solar panels in Illinois.
Solar equipment leases reduce your initial costs, but since you don’t own the panels, you can’t take advantage of the robust tax incentives in Illinois. Leasing your panels also won’t increase your home value nearly as much, if at all. Most importantly, leasing offers the least amount of energy savings over time on your utility bill. Buying and financing are typically better options, especially since financed deals can still limit your initial costs.
Yes, it is possible to eliminate your utility bills with solar in Illinois. However, you’ll need a fairly large system — probably close to 10 kW — to account for the additional energy you’ll use during the state’s hot summers and cold winters.
One of the best ways to keep conversion costs down in Illinois is to take advantage of as many incentive programs as possible. Most importantly, the federal tax credit can bring down the effective cost of your panels, solar inverters and batteries by 30%, or around $6,143 in Illinois.
You can also opt into net metering and make sure to sell the SRECs that you accrue for solar production. These two benefit programs can significantly shorten your payback period and maximize your savings over time.
Finally, you can get multiple quotes from installers in Illinois to find the best price for your budget. The state is home to nearly 100 solar companies, and getting a few estimates will let you choose the one that provides the greatest value for the least amount of money.
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