The state of Illinois is launching the biggest and most aggressive procurement program for renewables in the country. This program will pay for 30% of your systems total cost. Add that to your 30% federal tax credit and you have more than ½ of your system paid for. That's 60% off the total cost of your solar array. Don't forget about Depreciation. You can now depreciate 100% of your solar system.
These kinds of savings will put you at a 6 year payback.
Illinois has set a goal that is forcing electrical companies to acquire 25% of their energy through renewable sources, like wind and solar, by the year 2025. To help get everything organized, the state of Illinois created the IPA (Illinois Power Agency). Their purpose is to develop procurement plans for investor owned electric utilities, to supply thousands of homes with environmentally sustainable energy at an affordable cost. The investor owned utilities that are subject to the IPA's procurement plan are ComEd, MidAmerican, and Ameren Corporation companies.
The amount of $30 million was released into the Renewable Energy Resources Fund for the IPA to help Comed, MidAmerican, and Ameran procure environmental offsets/SRECs created from customer owned distributed generation facilities. (Customer owned solar array).
Environmental offsets are the amount of resources saved by using renewable energy. For example, an offset would be the amount of water saved from not burning coal to create your electricity. Utility companies will use water to wash the coal after it is pulled from the earth.
As your new solar array is pumping out clean renewable energy, it begins to accrue a certain amount of environmental offsets measured in the form of megawatts. 1 megawatt of energy off set, created by your solar array, equals 1 SREC. SREC stands for State Renewable Energy Credit. An SREC is of value because it represents a certain amount of environmental offsets.
In order for ComEd, Mid Ameren to meet their goal they will need to provide the same amount of service but use 25% less coal and other things. Their plan is to buy your environmental offsets/SRECs that your solar array creates. Keep in mind this is a separate incentive to net metering. This does not take away credits that you will earn through your utilities net metering policy.
The going rate of an SREC is determined by system size. The average size system for a home owner is 13.2kw. 1 SREC credit for a system that size is worth $72.00
What makes this procurement program so great is the utilities will pay you in cash. They will prepay you for 15 years of SRECS. A 13.2kw system will produce up to 16 megawatts or 16 SREC's in one year.
The Math is as follows:
13.2kw will produce 16 SRECS
1 SREC = $72.00
16 SREC X $72.00 = $1,152
$1152 X 15 years prepaid = $17,280
There will never be a better time to buy solar in Illinois. Out of the $30 million, only $15 million is actually going to "small" projects. By small, they mean solar arrays smaller than 25kw.
The price for SRECs will decline over time, as well. For every 5,000 to 10,000 systems installed the price will fall by 4%.
****The longer you wait, the more money you lose.*****