Illinois’ New Incentive: Solar Renewable Energy Credits
What is an SREC? Solar electric system owners now have the opportunity to sell what’s known as the Solar Renewable Energy Credits (SRECs) their solar array produces. The sale of these SRECs will allow solar owners to recover part of the initial price tag if they participate in the Illinois Adjustable Block Program. This is in addition to the 30% refund taxpayers already get as a credit against their federal taxes.
To protect Illinois’s long-term energy supply and its natural environment, the State of Illinois is mandated to ensure that a certain proportion of the electricity used in-state comes from renewable resources. One way of doing this is recognizing that individuals, businesses, and organizations that generate their own electricity using the sun instead of buying it from the local utility, create a real and measurable benefit to the community (in addition to producing their own power). The Illinois Power Agency (IPA) will use the Renewable Energy Resources Fund to purchase SRECs.
Through the SREC program, this community benefit from solar energy becomes a commodity that can be bought and sold, just like electricity itself. That’s what an SREC is – it’s the benefit to the community in terms of long-term energy security and protection of natural resources, that a solar array produces in addition to actual electricity.
The IPA will buy SRECs in 4 rounds. In each round, SRECs will be purchased starting with the lowest price first until the state-designated pot of money has been spent. In the vast majority of cases homeowners and small businesses will sell their SRECs through a middleman, referred to as an “aggregator” and the state will buy the SRECs in larger aggregated blocks. StraightUp Solar will facilitate the arrangements between our customers and the aggregator, Carbon Solutions Group, if your system was constructed on or after January 21, 2015.
Summary & Example SREC Calculation
An SREC represents the environmental benefits of producing one megawatt-hour of electricity using solar power. The IPA is purchasing SRECs under a 15-year contract. 1,000 kWh of solar electricity = 1 MWh of solar electricity = 1 SREC.
Call us today at (844) -97-SOLAR to take advantage of Illinois’ first ever SREC purchasing program.
We are signing contracts and guaranteeing SREC payments now!