Market Boldly

Market Boldly 008 - "Solar is hot in the Midwest & Beyond" with Tim Montague

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Solar energy is experiencing a burst of growth in Illinois and throughout the Midwest thanks in part to current state and federal incentives for homeowners, businesses, schools, colleges, local governments, nonprofits, and others who invest in solar photovoltaic (PV) energy systems.

Meet Solar Expert, Tim Montague

Tim Montague, commercial solar developer with Continental Electrical Construction Company of Oakbrook, Illinois, a western suburb of Chicago discusses the benefits and incentives associated with solar energy. Continental started its renewable energy division in 2009 and is one of the largest installers of solar PV (rooftop and ground mount) systems in Illinois. Recent projects include retailers like IKEA and Abt Electronics, a 10-acre solar array at IKEA’s Joliet distribution center, plus several schools and colleges.

Why Solar Makes Sense Now

• In recent years, the cost of solar technology has dropped significantly. It’s now less than 60 cents per watt; compared to $100 per watt in 1975.
• Payback periods are the shortest they’ve ever been—only 4 to 6 years, compared to 10 to 15 years just a few years ago.
• Federal and state legislation are making it possible to get into a solar array for as little as 10 to 15 cents on the dollar.
• Combining state and federal incentives can fund as much as 80% of a solar PV system.
• Companies can reduce their power bills by anywhere from 50% to 75%!

Here’s a Breakdown

Following is a breakdown of incentives and rebates for years one through five of a solar project.

Federal ITC (Incentive Tax Credit)                  30%

SRECs (Renewable Energy Credits)                 20%

Smart Inverter Incentive ($250/kW DC)        10%

MACRS Depreciation                                          30%

Electric Bill Savings                                             20%

As a result of all these incentives, the up-front cost to purchase and install a solar PV system can be reduced by as much as 90%!

Incentives Aren’t Forever

Manufacturers, distributors and contractors who want to get into or build their solar businesses need to act while the incentives are still good. Some payouts decrease each year and expire in as few as five years. Listen to the full podcast to learn how to take advantage of these opportunities while solar is hot.

Summary of Available Incentives

• Illinois Future Energy Jobs Act (FEJA) passed in 2016 and enacted in 2017 funds $200 million of cash incentives in Illinois project owners who get 20% of project value back as a cash incentive. FEJA also provides for rebates for smart inverters for distributed generation projects. (http://www.futureenergyjobsact.com/about)
• Modified Accelerated Cost Recovery System (MACRS) – Provides for accelerated depreciation for business owners, worth about 30% of project cost. (https://energy.gov/savings/modified-accelerated-cost-recovery-system-macrs)
• Solar Renewable Energy Credits (SRECs) – This is the Illinois state incentive that gives solar system owners a cash rebate worth 20 to 25% of a solar PV system. (https://energy.gov/savings/solar-renewable-energy-credits-0)
• Business Energy Investment Tax Credit (ITC) – This Federal tax credit of 30% for businesses and residents is available through 2020 for qualified solar projects, but phases out starting in 2020 down to 10% for businesses and zero for residents. (https://seia.org/initiatives/solar-investment-tax-credit-itc & https://energy.gov/savings/business-energy-investment-tax-credit-itc)

Use the Database of State Incentives for Renewables & Efficiency (DSIRE®) to research the financial incentives available to you.

For More Information

Check out these resources in Illinois, the Midwest and beyond to learn more about opportunities in solar energy.

• DSIRE® – Database of State Incentives for Renewables & Efficiency – free resource maintained by North Carolina University with information on thousands of policies and incentives for renewable energy and energy efficiency (http://www.dsireusa.org)
• SEIA – Solar Energy Industries Association – national trade association for the U.S. solar industry (https://www.seia.org)
• NABCEP – North American Board of Certified Energy Practitioners® – national certification organization for renewable energy professionals (http://www.nabcep.org/)
• ELPC – Environmental Law & Policy Center – regional environmental organization focused on Midwest policy for clean air, water and transportation (http://elpc.org)
• IBEW – International Brotherhood of Electrical Workers – union representing employees in the electrical and utilities industries (ibew.org)
• ISEA – Illinois Solar Energy Association – non-profit organization that promotes solar and other forms of renewable energy through education and advocacy (illinoissolar.org)
• MREA – Midwest Renewable Energy Association – offers one of the country’s top solar training programs and runs one of the largest grassroots sustainability events in the nation (www.midwestrenew.org)
• WOW – Wind on the Wires – works to create new opportunities for renewables to participate in the energy marketplace in Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, North and South Dakota, and Wisconsin (https://windonthewires.org)

UPDATE: 30% Tariffs on Imported Solar Panels

The week after we recorded this podcast, the Trump administration imposed a tariff of 30% on imported solar panels. This will impact the $28 billion solar industry, which gets about 80% percent of its solar panel products from imports. The Solar Energy Industries Association (SEIA) predicted the tariffs would increase prices and cost approximately 23,000 US jobs. SEIA represents manufacturers as well as installers, sellers and others in the field.

When asked about the new tariff, Montague responded, “It’s bad news, but not fatal. It might kill 23,000 jobs out of 260,000 so just less than 10% of the industry. We’re fine in Illinois because we have SRECS, but it certainly throws a wet towel on the industry.”