2024 Solar Incentives Guide for Springfield, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Springfield.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 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 Springfield?
Special Assessment for Solar Energy Systems
Solar Renewable Energy Credits
City Water Light and Power - Residential Energy Efficiency Rebate Programs
Geothermal Heat Pump: $500/ton
Rain Barrel: $25
High Efficiency Toilet: $50
Water Heater: $200 - $400
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The phrase "solar incentives" covers a range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. The incentives could include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the state of Illinois 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): SRECs and other similar performance-based incentives are typically handled at the state level. Once your solar system meets the threshold (normally a small amount of energy production), you can receive SRECs that can then be sold to your utility company or other buyers. The money you make is generally considered part of your taxable income.
- Rebates: A rebate is a partial refund credited to your account after you've paid for your solar system. These could be offered by your local utility company, your state or your county. The rebates are usually applied before calculating tax credits.
- Tax Exemptions: Your solar system could qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions let you ignore the added value of the solar panels when you are calculating property taxes on your home.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
- Net Metering: Be sure to talk with your Springfield utility company about signing a net metering agreement. This allows you to get a credit towards your utility bill every month for the value of excess energy your solar panels generate. You might receive either a dollar-for-dollar credit or a percentage of the value.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries
Best for Leasing
Sunrun
- Expansive service area
- Many financing options
- Some reported issues with customer service
- Some reported issues with door-to-door sales
Best Social Impact
Palmetto Solar
- Expansive service area
- Makes charitable contributions
- Certified B Corp
- No leases or PPAs
- Quality of installation may vary by location
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some knowledge of. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a certain percentage of your solar system's cost.
The ITC initially applied to 30% of the total cost of installing a solar system, although it has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total cost of installation includes the panels themselves as well as the cost of equipment, accessories and labor. There is no maximum claim amount. The ITC can be applied to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be in the United States and owned by you.
Your local Springfield solar panel installer can offer more information about the ITC and how it applies to your situation.
The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Homeowners can now receive 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 on a yearly basis until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to obtain credits for energy storage systems with the new act.
More information about the new Inflation Reduction Act can be found here. Your local Springfield solar panel installers are the best people to answer your questions about the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
Some solar incentives are often also provided at the state and local level. As with federal incentives, these may include tax credits, rebates and more. Certain incentives are offered for only a limited time, while others are ongoing. These local incentives may come from your county or municipality, or from the Illinois government.
Next Steps for Installing Solar in Springfield
You can apply for solar incentives from the Illinois government and the federal government, as well as from your local utility company. This increase in availability of solar initiatives over the last 15 years has helped greatly increase nationwide adoption of solar energy. Your local Springfield solar panel installer can help you learn more about which incentives you can apply for, and get you started on the path to switching to renewable energy today.
EcoWatch's Springfield, IL Solar Incentives FAQs
What are the environmental benefits of switching to solar?
Solar energy is a renewable energy source — by changing where you get your energy, you help lessen the strain on our planet's resources. You can also reduce your home's CO2 emissions by 500 pounds annually, or around 13,000 pounds in 20 years.
How long until the federal solar tax credit ends?
The Clean Energy Credit (previously referred to as the federal solar tax credit, or ITC), is scheduled 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 receive incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can receive both tax credits and rebates towards the cost of your solar panels. Depending on precisely which incentives you are receiving, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to verify that you are claiming the correct incentives and that you're getting the most money possible.
What if I want to add a solar system to a rental property, vacation home or commercial property? Can I still qualify for incentives?
While we recommend getting in touch with your local solar installer and/or tax professional to fully understand what solar incentives apply to you, many incentives can be claimed on a second home, so long as that home is in the United States and owned by you. There may be other incentives available for commercial properties specifically, depending on the details.
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.