Joliet, IL Solar Panels

Illinois offers a property tax exemption for residential solar energy systems, which means the added value from installing solar panels won’t increase your property taxes. When you add solar panels to your home, they typically increase your property’s assessed value. However, this exemption ensures that increase is excluded from your property tax assessment, allowing you to enjoy the benefits of solar energy without paying higher property taxes on that improvement.

The exemption applies to solar energy systems installed on residential properties in Illinois and continues for as long as you own the system. There’s no dollar limit on the exemption—whether your solar installation adds $10,000 or $30,000 to your home’s value, that entire increase is exempt from property taxation. To qualify, your solar energy system must be used primarily for on-site energy generation for your home. The exemption is automatic in most cases, though you should verify with your local assessor’s office that it has been properly applied to your property after installation.

The Distributed Generation Rebate (Smart Inverters) is a state program in Illinois that provides cash rebates to homeowners who install solar energy systems equipped with smart inverter technology. Smart inverters are advanced devices that not only convert solar energy into usable electricity for your home, but also help stabilize the electric grid by communicating with utility systems. This program rewards you for choosing equipment that benefits both your household and the broader community.

The rebate offers $300 per kilowatt (kW) of installed solar capacity, which typically translates to approximately $2,000 to $3,000 for an average residential solar system. This is a direct cash rebate that reduces your upfront costs, making solar energy more affordable from day one. The actual amount you receive will depend on the size of your solar system—larger systems will receive proportionally higher rebates.

While specific eligibility requirements weren’t available in the source materials, this program is generally designed for Illinois residents installing new solar systems with qualifying smart inverter equipment. It’s important to work with your solar installer to confirm that your system meets the technical requirements and that all necessary paperwork is submitted properly. Be sure to ask about current funding availability and any application deadlines, as state rebate programs can have limited budgets that may be allocated on a first-come, first-served basis.

Illinois Shines (officially known as the Adjustable Block Program) is a state-run solar incentive program that helps Illinois homeowners and businesses reduce the cost of installing solar panels. The program works through a system of Renewable Energy Credits (RECs) – when your solar system generates clean energy, it creates RECs that utilities are required to purchase. While you don’t receive these payments directly, approved solar installers (called Approved Vendors) contract with utilities to sell these RECs and typically pass the financial value back to you through reduced equipment costs, lower installation prices, or discounted lease and power purchase agreement rates.

The program is available for residential and commercial solar installations throughout Illinois, including rooftop and ground-mounted systems of various sizes. To participate, you must work with an Illinois Shines Approved Vendor who will handle the program application and REC contract process on your behalf. The program offers 15-year or 20-year REC contracts depending on your project type. Before signing any contract, your installer is required to provide you with a standardized Disclosure Form that clearly shows all costs, how much of the Illinois Shines incentive value is being passed through to you, estimated savings, and payment terms – making it easier to compare bids from different installers. The program also includes strong consumer protections and resources to help you make informed decisions about going solar.

Illinois Solar for All (ILSFA) is a state program that makes solar energy accessible to income-eligible households, nonprofit organizations, and public facilities. The program covers the upfront costs of solar installation, so you don’t need to pay anything to get started. You’ll work with registered solar contractors who handle the installation and program paperwork on your behalf.

The financial benefit is straightforward: you pay no more than 50% of the value of the electricity your solar system produces, guaranteeing you at least 50% savings on your solar energy. For example, if your solar panels generate $100 worth of electricity credits, you’ll pay no more than $50. Income-eligible homeowners can install solar panels on their roof or property, while renters and homeowners can also subscribe to community solar projects and receive electricity credits on their bills based on the project’s production.

To qualify, you must meet income-eligibility requirements and work with a solar contractor registered with the Illinois Power Agency’s ILSFA program. The program is designed specifically for low-income households and communities, as well as nonprofits and public facilities serving these areas. Your contractor will verify your eligibility and submit your application to the program. The program provides payments to contractors for 15 years of renewable energy credits, which helps offset your system costs and enables the guaranteed savings structure.

Illinois has transitioned from traditional net metering to a net billing system for solar customers. The rules depend on when your solar system receives Permission to Operate (PTO). If your system was activated by December 31, 2024, you benefit from full retail net metering where excess solar energy you send to the grid is credited at the full retail electricity rate. These credits roll over month to month and can offset your entire electric bill. However, unused credits expire twice a year (typically in April and October) with no cash payment for remaining credits.

For systems receiving PTO on or after January 1, 2025, Illinois utilities now use a net billing structure. Your excess solar energy exported to the grid is credited at the “Price to Compare” (PTC) rate, which includes only supply and transmission costs—not delivery charges. This rate is significantly lower than the full retail rate: ComEd’s average PTC was 6.8 cents/kWh in 2024, Ameren’s was 8.3 cents/kWh, and MidAmerican’s ranges from 3.7 to 6.7 cents/kWh depending on season. These credits can only offset the supply and transmission portions of your bill, not delivery charges, customer fees, or taxes. The good news is that under the new system, unused credits roll over indefinitely rather than expiring twice yearly. Your specific utility (ComEd, Ameren, MidAmerican, City of Naperville, or City of Springfield) will determine your exact credit rate and terms.

The key takeaway: systems activated before 2025 receive more valuable credits but lose them if unused, while newer systems receive lower-value credits that never expire. Proper system sizing is essential to maximize your savings and avoid forfeiting credits.