Renewable Energy Technology Incentives in Illinois | The Renewable Energy Hub USA

Renewable Energy Technology Incentives in Illinois


Illinois is a central hub for gas, oil and coal and has invested a large amount in nuclear energy which currently provides some 12% of its energy mix. Unlike some other states, it has enacted a renewable portfolio standard that forces utility companies to provide 25% of their energy from green technologies such as solar PV and wind by 2025. This is a moderately ambitious target but one which the state is confident of achieving.

Illinois is typical of the US as a whole where a battle is going on between those going for broke on renewable technologies and those who are adamant about maintaining industries such as nuclear. This could because the state is a net energy exporter and a lot the uncertainty comes from their nuclear capacity as well as changes such as lower gas prices and the growth of wind energy which have threatened the industry already.

Capacity for solar has increased steadily over the years but it still only provides a relatively small percentage of the energy mix for the state. While large stores such as IKEA are installing solar panels on their factory roofs and some large commercial ventures such as the 20MW Grand Ridge Solar Plant have come online, there is still some way to go. Wind power is more successful, providing nearly 5% of the state’s energy with 3,568 MW capacity by the end of 2014. 

Solar PV Incentives in Illinois

Illinois provides a number of incentives for the installation of solar PV including their own Solar Renewable Energy Credits. This and the Federal Tax Rebate which can reduce the cost of an array by 30% and the property tax Special Assessment for Solar Energy Systems means there are number of ways in which residential and commercial concerns can reduce their costs.

Businesses can benefit from local initiatives such as the City of Chicago Small Business Improvement Fund that can cover up to 75% of the cost of an installation depending on the size. They can also get access to low cost loans through the Illinois State Treasurer's Office.

Solar PV Case Study in Illinois

There are options to buy outright or enter into a leasing arrangement with a company (which takes over the benefits of state and national incentives but provides you with cheaper priced electricity for the term of the lease). If you choose to take out a loan or buy from your savings, a 5 kW array could start as low as $15,900 after the state’s 25% rebate. If you add onto this the Federal Tax Rebate the price will come down another 30% giving you a decent return on investment that begins paying for itself after about 13 years. Net profit over the 25-year lifetime of your array could be in the region of $23,000 plus the value that has been added onto your property.

Solar Thermal Incentives in Illinois

Switching to solar thermal can help reduce the costs of heating by as much as 80% for some households and is a green energy that is becoming increasingly popular. Installations get the same incentives as solar PV and this can make it a good option for many home owners and for businesses. 

Small Hydro Incentives in Illinois

Illinois has a few hydroelectric facilities producing a small amount of electricity though the state is well placed for micro hydro if it chose to adopt this technology more aggressively. This is not highly incentivized however although companies like Eagle Creek are beginning to develop new projects across the whole of the Northwest including Illinois. 

Geothermal Incentives in Illinois

As with many other states, geothermal options such as ground source heat pumps are incentivized, mainly through local utility companies as well as grant programs such as the Efficient Living Energy Grant which can provide a maximum cash boost up to $450,000. Built for the right home or office, a geothermal renewable technology like a heat pump can halve heating costs and provide a significant return on investment. It is also very low maintenance compared to other installations such as wind and solar PV.

Biomass Incentives in Illinois

Biomass energy production, as with many other states, is beginning to gather momentum and there are suggestions that it could form a vital part of the energy mix in the future. For now, however, incentives are thin on the ground though schemes such as the Public Sector Energy Efficiency Aggregation Program may be applied.

Wind Power Incentives in Illinois

Illinois has recently invested a great deal in wind power and has a number of plants, Bishop Hill and Minonk providing 200 MW each. By the end of 2013, the state had in the region of 944 GWh capacity with power to add in the future. For remote communities and farms, wind power can be a good investment. Despite the high $7,000 per kWh installed price tag, a good return on investment can be obtained and installations benefit from the Federal Tax Rebate as well as the state rebate. Commercial ventures can also reduce costs through the Sales Tax Exemption for Wind Energy scheme.

Like many states, Illinois seems to have been reluctant to embrace fully the idea of renewable energy and its potential for the state’s future. With nearly half of its energy coming from nuclear, there’s no likelihood that Illinois will suddenly become a full convert to the green cause. There are, however, enough incentives out there to make swapping to technologies like solar PV and geothermal a worthwhile investment.

To find out more about incentives for renewable technology in Illinois, visit the DSIRE web site.

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