3. What incentives are available?
- For residential and commercial solar electric systems, there is a full 30% Federal Tax Credit available until 2019.
The tax credit is set to step down according to the following schedule:
Systems placed in service by 12/31/2019: 30%
Systems placed in service between 1/1/2020 and 12/31/2020: 26%
Systems placed in service between 1/1/2021 and 12/31/2021: 22%
Systems placed in service after 1/1/2022: 0% Residential, 10% Commercial
- Businesses can also qualify for Modified Accelerated Cost-Recovery System (MACRS), otherwise known as Rapid Depreciation. MACRS classifies solar electric systems as five-year property for depreciation purposes.
- Agricultural producers and rural small businesses may also apply for the US Department of Agriculture’s Rural Energy for America Program (REAP).
- REAP is a competitive grant program that awards up to 25% of project expenses to qualified renewable energy projects.
- In Illinois, the Solar Renewable Energy Credit (SREC) program allows the owner of a solar electric (PV) system to sell their system’s SRECs, or the environmental benefits associated with the production of solar energy, to offset the cost of the system.
- 1 SREC is equal to 1 Megawatt-hour (1,000 kWhs) of solar electricity production.