The Cost of Waiting for the Solar Illinois SREC Incentive is high
You may have heard that the Illinois SREC program is currently out of funding. While the Illinois Solar Renewable Energy Credit (SREC) available via the Illinois Shines program has been a lucrative incentive, the funding is currently on hold until the Illinois Legislature is able to pass the massive energy bill that is currently up for debate. However, all is not lost. There are many, many other benefits to not lose sight of. By delaying going solar, you are only prolonging the realization of other benefits available. Read below why you should consider going solar at your home, farm, or business now.
Tick Tock…it’s time to take action!
Recently the Illinois State Legislature has attempted to pass a comprehensive energy bill. As of this writing, the bill has still not been approved. Comprehensive may be an understatement, as the proposed energy bill seeks to address many complicated issues related to electricity generation in Illinois. For the purposes of this blog post we’ll stay focused on the solar aspects.
In late 2020, the Illinois Shines program ran out of funding across all solar size categories. Despite this, a handful of projects across the state were canceled for various reasons, freeing up previously earmarked funds for waitlisted projects. We’ve seen many of our projects on the waitlist get approval, but many others will not get funding unless new funding is passed by legislature. Until this gets sorted out, our position is to:
- apply for funding
- get on the waitlist
- proceed with installing your project
There is a major push for additional renewable energy in Illinois, so the likelihood of future funding is bright but not guaranteed.
Let’s explore all the other benefits that investing in solar offers and why waiting for the state can cost you money and benefits.
Great benefits available to those who act now!
- Electricity Cost Savings – Producing your own electricity reduces reliance on purchased energy from the utility company, generating immediate cost savings. Paying the monthly electric bill is a pure expense and does not provide a return on investment. Investing in a “hard asset” such as solar, which generates electricity, provides immediate value. Waiting to invest in solar will only delay saving money!
- Low Interest Rates / Low Cost Financing – With today’s historically low interest rates, it’s a great time to refinance your property to fund a new solar array, obtain a residential or commercial loan, or work with one of our solar lenders. We offer flexible options so waiting to save money or build your internal capital could be an unwise move when so many low-cost financing options exist.
- 26% Federal Tax Credit – See last month’s blog post for more info on this GREAT benefit. This tax credit is a $1 for $1 offset of tax liability and is a tremendous financial benefit for those who can utilize it.
- Electricity Inflation – With an economy that is returning to life after COVID-19’s lockdowns and rapid rises in materials costs, we’ll likely start seeing pressure on electricity rates soon. Our electricity infrastructure is aging, and the on-going upkeep is expensive also pressuring future rates. As rates potentially rise, owning your own solar system protects from this risk.
- Electrical Materials Inflation – We’re seeing rapid increases in copper, aluminum, steel, and other commodities which makeup electrical equipment we use in solar installations. Act now, before inflation further increases the overall cost of a solar system. Solar panel prices are starting to tick up as well.
- Diminishing Availability of Net Metering – Ameren customers can still qualify for Net Metering which helps boost the energy savings from a solar array. However, once Ameren reaches 5% of their demand met by solar, they no longer have to offer Net Metering. In many rural coop areas, Net Metering has already gone away. It will likely be phased out in other areas soon. Those who act now have an advantage versus those who wait.
- Accelerated Depreciation for Businesses/Farms – For businesses, farms, or even some home-based businesses, solar qualifies as 5-year property enabling accelerated write-off, or depreciation, of a solar investment. Section 179 bonus depreciation may apply under advisement of your tax professional. Learn more about that here.
- Solar Smart Inverter Rebated (for Business/Farms) – This rebate, valued at $250 per kW (DC), is another great benefit for business consumers. This rebate is intended to incentivize installation of grid interactive or “smart” inverters that can one day be leveraged by the major utility companies (like Ameren and ComEd) for providing benefits to the electrical grid when called upon. One caveat is that consumers who take this incentive forego Net Metering.
- Clean Energy from the Sun – Abundant sunshine reaches our rooftops and backyards, so why not convert to clean, local electricity? Traditional power sources derived from coal, nuclear, or gas can generate considerable emissions or pose potentially harmful radiation risks. Help the environment by generating your power with solar.
- Greater Energy Independence – By generating solar at point of use, your home, farm, or business can be less reliant on centralized power generation grid and power plants. Adding a backup generator and/or batteries can help to become potentially as high as 100% electricity independent. Ultimate independence awaits those who convert natural gas or propane fueled appliances to electric and then self-generate electricity with solar (and/or wind power).
- Property Value Can Increase with Solar – Studies have shown that homes with solar often sell faster and for higher sale prices than homes without solar. Tick Tock Energy is the only Pearl-certified solar contractor in Illinois and we provide homeowners with the Pearl certification that can help support your property valuation. Learn more here. For farms or businesses, property value is often tied to the net income generation from the property. By lowering operating costs, net income goes up which can translate into greater property value.
Sheeesh – what a long list! Did we miss anything? If so, email [email protected] and let us know. The time to invest in solar is now so don’t delay!