Commercial Solar Power Incentives
Investing in solar power is low-risk and surprisingly affordable supported by lucrative incentives. As a commercial business, you have access to many incentives and rebates to help defray the cost of your new solar energy system. Your big risk is exposure to volatile electricity prices which go up with inflation and constraints of our electricity grid.
Types of Solar Power Incentives to Explore
Investing in your facility with solar and energy-efficiency solutions reduces electrical operating expenses and may provide a much higher return on investment (ROI) when compared to the cost of trying to acquire new customers for your business. Plus, there are many great solar incentives in Illinois and other states to help lower your investment on your new solar power system.
Tax Credits
The federal government offers the Investment Tax Credit (ITC) which allows businesses to reduce federal tax liability. This fantastic incentive helps defray the overall cost of your solar project while reaping significant return on investment.
SREC Incentive
Some states such as Illinois offer the ability to get paid for electricity produced from your solar array. Typically a SREC contract is established with the State and payments occur over time for solar electricity produced.
Solar Rebates
Rebates provide businesses with a cash incentive after the solar energy system is installed, effectively lowering the initial investment required. These rebates are often offered by local utilities or state programs and can be applied directly to reduce upfront costs.
Grants
Grants offer businesses non-repayable funds to support the installation of solar power systems, often provided by government agencies or non-profit organizations. These grants can cover a substantial portion of the project costs, making solar energy more accessible to businesses of all sizes.
Available Solar Incentives for Your Business
You have access to multiple incentives, at both the federal and state levels, to make the upfront costs and overall investment in solar more manageable for your business.
Federal Investment Tax Credit (ITC)
A tax credit is a dollar-for-dollar reduction in your business’ income taxes. The Energy Policy Act of 2005 created ITC for commercial solar energy systems, and as of December 31, 2023, a business can qualify up to 30% tax credit with potential for additional bonus adders worth up to 20% additional for location in an energy community or installing equipment with domestically produced content.
5-Year Accelerated Depreciation (MACRS)
The Modified Accelerated Cost Recovery System (MACRS, is a method of depreciation in which a business’ investments in certain property are recovered, for tax purposes, over a specified time period through annual deductions.
The IRS classified solar PV equipment as 5-year property, allowing businesses to expense or write-off solar investments quickly. The added tax deduction can further boost your project’s ROI, and you may qualify for faster write-off with Section 179 depreciation allowances.
Illinois Solar Renewable Energy Credits (SRECs)
Solar renewable energy credits (SRECs) provide an outstanding solar incentive that helps an owner recoup a solar system’s investment. In Illinois, the Illinois Shines Programs administer SRECs that can potentially cover 20-40% of your total solar investment.
One SREC typically equals 1,000 kilowatt-hours (kWh) of solar energy generated, and SRECs accrue as solar electricity is generated. These credits are paid out quarterly or at other intervals defined by each state.
Ameren-Illinois & Comed Smart Inverter Rebate
Smart inverters provide active voltage and frequency control while communicating with utilities. As Illinois strives for more electricity from renewable sources, the state has rolled out several incentives to move its energy portfolio toward solar and wind resources. These incentives include a rebate when you purchase a smart inverter for your business’ solar panel installation.
To access this rebate, customers must enroll under a net metering tariff that only provides net metering credits for the generation (supply) portion of a customer’s utility bill. The rebate covers $250 per kilowatt (kW) of your project’s direct current capacity.
USDA REAP Grant for Small Businesses
Small rural businesses and farms can benefit from a USDA REAP grant, providing funding for renewable energy projects or energy-efficiency retrofits. These grants also provide loan guarantees! If your business is located in a rural area with a population under 50,000 people, this grant can provide up to 25% in grant funding. Plus, even businesses with several hundred employees can potentially meet the definition of “small business.”
While this grant is highly competitive, Tick Tock Energy offers grant-writing services to assist you. We have a long history of helping our clients land grant funding and can explore all your available options to find the best financing solutions for your company.
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Tick Tock Energy is ready to help you invest in a clean solar energy system on your property, capture lucrative solar incentives, reduce long-term electricity costs, and and enhance the value of your property. To discuss your power needs with one of our solar consultants, request an initial consultation and quote today.
Tick Tock has helped countless business owners across the Midwest enhance the value of their property and reduce their electricity costs with solar power systems. Explore our recent installations below.
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