Incentives help solar industry amid rising costs linked to inflation

Along with other U.S. states, Illinois is working to become more reliant on renewable energy sources instead of fossil fuels. The head of a local Bloomington-Normal solar installation company said state and federal incentives make Illinois one of the strongest states in adopting solar energy.

Shannon Fulton runs the Bloomington office of StraightUp Solar, a company that has been around since 2007. She said the opportunity to go solar is better than ever.

“When you combine those (state) incentives with those available at the federal level, in the form of tax credits and direct payments to entities that do not pay taxes, the case for solar energy is stronger than ever,” he said.

Illinois has production-related incentives, which consist of cash payments related to a certain amount of electricity a solar system produces.

“It’s a program known as Illinois Shines and it’s based on the production of renewable solar energy credits,” Fulton said. “It’s the primary mechanism Illinois is using to achieve our renewable portfolio standard of 40 percent renewable energy by 2030.”

The state’s goal of reaching that amount of renewable energy is six years away. Currently, Fulton said the state is not on track to meet the deadline.

“In six years, it’s going to be a big task to get to that point, we’re falling a little bit behind,” he said. “But, given the amount of solar development that’s going on, the solar development and construction that’s going on, I’m confident we can get there. I think it’s a goal we can reach.”

In addition to incentives, Fulton said rising electricity costs are heavily impacting people’s decision to go solar. While the cost of solar equipment had been declining in recent years, it has been increasing in recent years, which she said is largely due to inflation. Higher interest rates have also slowed solar installations as customers wait for a better time to apply for loans.

Fulton said the time to receive payment, or recognition that the system has improved an individual’s finances, is about six to eight years.

“It depends on the size of the system and whether it’s Ameren or Corn Belt (Energy),” he said. “There are a number of factors at play, but I would say with confidence that the payback period is six to eight years.”

Some customers choose to convert for ecological reasons or because they want to use renewable energy to improve the environment. Fulton said this is rarer than one might think.

“I would say that the vast majority of people are going solar for economic reasons,” he said. “They want to protect themselves from rising costs, but there are always people who are concerned about the environment. I am one of those people, that was one of the reasons I went solar and got into this industry, but I would say that honestly, over 90% of people who go solar are doing it for economic reasons.”

She said environmental reasons seemed to be “the icing on the cake for most people.”

Recent NPR reports show that rooftop solar panel installers have been receiving complaints from consumers and even prosecutors have investigated their sales practices. Fulton said that “knockers” who knock on a person’s door often overpromise or oversell what solar power is capable of doing.

“I think door-to-door salespeople, if they are really under pressure to get leads and sell them and sell as many projects as possible before the end of the year, can also over-promise,” he said. “It’s not magic, it’s technology.”