Are solar panels worth it in Chicago?

Are solar panels worth it in Chicago? Considering the hustle and bustle of city life, and the energy demands that go along with it, going solar in the Windy City of Chicago is a smart idea.

Chicagoland is a sprawling metropolitan area, with 1,217,686 homes in the city of Chicago alone⁽¹⁾. Add to that nearly 100,000 businesses operating in the city⁽²⁾. Together, these properties consume a whole lot of energy!

Fortunately, the adoption of solar is growing in the state of Illinois. This provides a much-needed measure of relief to the strained electric grid.⁽³⁾

Top 6 reasons to go solar in Chicago

But are solar panels worth it in Chicago for you? Well, there’s a wide range of reasons why Chicagoans go solar, from helping the planet to getting relief from high electric bills. Regardless of what your motivation is, we’re exploring reasons why we believe solar panels are a bright idea in Chicago.

1. Lower energy costs

Living in Chicago isn’t cheap, and the high cost of living includes electricity prices. As of November 2022, the average residential electricity rate in Chicago was 16.99 ¢/kWh — 6% higher than the national average.⁽⁴⁾ Plus, electricity prices across the board have continued to rise as the wholesale cost of natural gas does.⁽⁵⁾

While you can’t control electric prices in Chicago, there’s good news. By going solar, you could lower your monthly energy bill¹. It’s possible to achieve this goal by using solar energy to power your home during the day. Adding a battery backup allows you to use solar energy at night, too.

2. Protection from power outages

Weather that’s getting more extreme has impacted the nation’s power grids in a major way. In fact, the last six years have seen the number of outages more than double⁽⁶⁾ in comparison to the previous six years.

Chicago might take pride in being the Windy City, but wind has a history of toppling trees and knocking out power. More than 25,000 people were left without power⁽⁷⁾ when thunderstorms hit the area in August 2022. Storms and heavy winds pummeled Chicago again later that year in November, causing over 33,000 people to lose power.⁽⁸⁾ Compounding the problem, energy capacity is falling short in the summers⁽⁹⁾ due to higher-than-normal temperatures. As a result, controlled power outages could become a reality for Chicagoans.

Also called rolling blackouts, these events are planned by utility companies. Controlled power outages occur when power is temporarily shut off in designated areas to prevent larger outages from occurring. In this way, they help keep the electric grid stable. Rolling blackouts take place when the demand for energy is higher than the available supply.

Now, Chicagoans face the possibility of controlled power outages impacting their lives. But some positive developments are providing a solution in the form of solar energy adoption. There’s enough solar wattage currently installed in the state to power 229,525 homes. This puts Illinois in the top 20 for solar installations in the U.S.⁽¹⁰⁾

If you have a solar panel system with a backup battery, components of your home could maintain power during blackouts². Now, this depends entirely on factors like how much energy is stored in the backup system and what you choose to power during an outage.

3. Environmental benefits

Traditional electricity isn’t really the best for our planet. The U.S. relies on electricity created from fossil fuels to fulfill most of its energy needs.⁽¹¹⁾ These fossil fuels emit harmful greenhouse gases.

When solar panels produce energy, on the other hand, they don’t emit any greenhouses gases. Period. Pretty impressive, right? Every single person who goes solar contributes to cleaner air and a healthier planet.

Not to mention that going solar helps ease some of the demand on the power grid that we talked about earlier. And since solar is the most abundant form of energy on Earth⁽¹¹⁾, we don’t have to worry about running out of it.

4. Incentives for going solar

Federal solar tax credit

If your solar energy system qualifies, you could get the solar investment tax credit. This federal solar incentive allows you to take advantage of a tax credit worth 30% of the system’s cost when filing your taxes*. The credit is applied to taxes from the same year the system was installed.

The federal solar tax credit makes 30 a lucky number for many homeowners!

Solar renewable energy credits

Homeowners with a qualifying solar panel system get one solar renewable energy credit (SREC) for every 1,000 kilowatt-hours (kWh) of solar power generated by their system.⁽¹²⁾ The homeowner can then sell their SRECs to local utility companies at the market rate. This exchange is also known as the Adjustable Block Program. Due to its overwhelming popularity, the program was expanded under the Climate and Equitable Jobs Act. That said, demand is still high, so interested homeowners should apply soon.

Green Building Permit Program

Chicago homeowners can apply for the Green Building Permit Program. If your application is approved, your permit fees could be reduced, and your permit process could be expedited. These advantages are beneficial because they could save you money and time during the installation process.

Illinois Solar for All

If you’re interested in solar, but have a limited budget for it, we recommend checking out Illinois Solar for All. This program is driven by approved vendors, who get Renewable Energy Credits (RECs) in exchange for participating. The vendors, which include solar installers, sell the RECs. They then take the money they’ve made from the sales and use it to reduce upfront costs for homeowners.

Keep in mind that as a low-income program, participation in Illinois Solar for All is limited to homeowners who meet the income requirements.

5. Net metering credits

At times, your solar panel system will produce more power than your family uses. If your utility company offers a net energy metering (NEM) program, you can earn credits for the excess energy**. The utility company will then apply these credits to future electric bills. If this happens, you’ll enjoy lower bills.

Three major Illinois utility companies offer net metering:

• Ameren Illinois Utilities
• Commonwealth Edison (ComEd)
• MidAmerican Energy Company

So, how does the Illinois net metering program work? Solar energy systems that are 40 kW or less receive a one-to-one retail rate credit. In simple terms, this means that homeowners are credited for the excess energy their systems produce at the same rate the utility company charges for electricity. The credits get carried over on a month-to-month basis.

Credits for a solar panel system between 40 kW and 2 MW, as well as those from utility companies that charge time-of-use rates, work a bit differently. We recommend contacting your own utility provider to find out how your arrangement might work.

6. Home value increase

More people are discovering the benefits of going solar every day. And with this awareness comes a rising demand for homes equipped with a solar panel system. This trend is evident in the real estate market, where homes with solar panels are selling for 4.1% more on average.⁽¹³⁾ Keep in mind that this percentage will differ according to where you live.

Are solar panels worth it in Chicago?

Well, the potential savings, great solar incentives, protection from power outages and environmental benefits make a convincing argument. Plus, you’ll get to join a fast-growing group of Chicago homeowners going solar.

So, are solar panels worth it in Chicago? A Solar Energy Specialist can help you make the final decision for yourself. And with a free consultation, their expert guidance won’t cost you a cent. Contact us to schedule your consultation.

 

*If you have taxable income and own the system, you may qualify for the solar federal investment tax credit. It is your responsibility to determine your eligibility and to apply. Consult a qualified tax professional for assistance and details.