Illinois renews its best solar incentive under Climate and Equitable Jobs Act

If you’ve been interested in getting solar panels installed in Illinois, you probably know the state of Illinois solar incentives has been up in the air for quite some time. Not any longer, though, as The Illinois Climate and Equitable Jobs Act (CEJA) was signed into law by Governor JB Pritzker on September 15th, 2021.

The CEJA, also known as SB2408, sets a goal of 100% clean energy in the state by 2050 and contains many very important provisions that establish the pathway to that overarching goal. These include job programs, low-income solar incentives, EV purchase rebates, and public school renewable energy goals. 

Most important for readers of this site is this: The Climate and Equitable Jobs Act re-established the “Illinois Shines” Adjustable Block Program (ABP), which authorizes the purchase of Renewable Energy Certificates (RECs) from solar panel system owners.

The payments under the ABP are made to system owners by Approved Vendors of the program after the system is fully interconnected and the system owner’s application has been approved by program administrators. In 2023, the average Illinois homeowner in the Chicago area (ComEd) could earn an estimated payment of up to $10,000 in exchange for 15 years of the RECs produced by their solar system under the ABP. That’s more than 50% of the estimated cost to install the system.

Details of the Illinois Shines Adjustable Block Program 

The Adjustable Block Program was first established in 2018 in order to incentivize solar adoption. The program establishes a method by which intermediaries known as Approved Vendors purchase RECs from solar system owners based on the expected production of their solar installations for the first 15 years of operation.

In December 2020, the program ran out of funds, and homeowners who installed solar panels since then have been placed on a waitlist in case further funding was approved. That time has now come!

Buried deep on page 341 of the final CEJA bill is a section that re-establishes and expands the ABP, and will provide funding for everyone on the waitlist and then some. We’ll focus only on the residential program here, as SolarReviews is a resource for homeowners. 

The bill says:

• The program will open a new block of funding for at least 75 MW of small solar projects, no later than December 14, 2021

• The payments will be 4% lower than the last available block (see amounts below)

• People already on the waitlist (about 40 MW of projects) will have the first chance to have their application approved under the program

• The system size limit for new installations to qualify as “Small Distributed Generation” and earn the highest incentive will be raised from 10 kW to 25 kW

Illinois Adjustable Block Program payments 

Below is a table with information about the prices paid for each REC under the 2022-23 ABP, and an estimate of the number of RECs that will be produced by the average-sized (6.4-kW) solar system in Illinois. Note that there are different prices paid for RECs based on system size, with lower prices paid for RECs produced by systems sized between 10 and 25 kW.

A REC is awarded for every megawatt-hour (MWh) generated by a system. In Illinois, each kilowatt (kW) of solar panels can generate about 1.37 MWh of electricity per year. 

REC prices vary based on groups defined by geographic location and utility.

• People in Group A are served by Ameren Illinois, MidAmerican, Mt. Carmel Public Utility, or rural electric cooperatives and municipal utilities located in the Midcontinent Independent System Operator (MISO) territory

• People in Group B are served by ComEd or rural electric cooperatives and municipal utilities located in the Pennsylvania, New Jersey, and Maryland Interconnection (PJM) territory

If you’re unsure which block you qualify for, ask a local solar installer as you gather quotes for your system.

Group	Residential Block 4 $/REC	Estimated RECs produced	Estimated payment
A	$78.51 up to 10kW $66.39 between 10 and 25 kW	122	$9,578.22
B	$82.22 up to 10kW $71.89 between 10 and 25 kW	122	$10,030.84

The actual payments of the incentive are made to approved vendors after a homeowner’s system is interconnected to the grid and ready to operate. The homeowner enters into a contract with and receives payment from the vendors. After the incentive payment, the homeowner needs to ensure their solar panels keep producing electricity for 15 years. That’s why it’s extra-important to choose a reliable company to install your solar system.

Choosing a reliable solar installation company requires careful planning. You should be ready to read reviews of local solar installers, decide whether the quotes they provide are accurate and complete, and ask a lot of questions. Fortunately, SolarReviews can help start that process with our solar calculator, which provides estimates of cost, savings, and incentives and allows you to connect with installers near you. 

The future of the Adjustable Block Program 

There is reason to believe the ABP will continue, because the law requires utilities in the state to procure 5,500,000 RECs from solar projects during 2021, increasing to 24,750,000 per year by 2030. The ABP has thus far been the mechanism utilities use to procure those RECs.

2023 update: The program is already approved and open for 2022-23 at the above REC prices, and the program administrator has planned to open the 2023-24 program on June 1, 2023.

Other details of the Climate and Equitable Jobs Act 

The path to get to the passage of SB 2408 was long and full of complications. Groups of people from all backgrounds, from the climate justice movement to organized labor (and even the coal industry) came together, negotiated in good faith, and, with help from some key players in the Illinois state legislature, got the bill done. Check out this excellent rundown of the history for more details. 

In addition to 100% clean energy by 2050, the CEJA also does the following:

• Establishes the Clean Energy Jobs and Justice Fund, a 501(c)(3) nonprofit, to develop new ways to fund and support renewable energy projects, education of new contractors from historically marginalized communities, and more

• Establishes an equity accountability system to ensure renewable energy procurements benefit historically marginalized communities. The bill proposes to do this “by providing access to the clean energy economy for businesses and workers from communities that have been historically excluded from economic opportunities in the energy sector.”

  • As the system is established in late 2021, the bill requires that at least 10% of the workforce for covered projects must be made up of “equity eligible persons or equity eligible contractors.” By 2030, that number needs to be 30%

• Sets a goal of 1,000,000 EVs on Illinois roads by 2030 (up from 26,000 as of June 2021)

  • Provides rebates for purchasing an electric vehicle, starting at $4,000 on July 1, 2022, stepping down to $2,000 on 7/1/26 and $1,000 on 7/1/28

• Sets a goal for public schools to be carbon-free in their energy usage by 2030, with a further goal for them to use carbon-free energy sources for space heat, water heat, and transportation by 2050

• Reaffirms the Solar for All Program, which provides $0-down solar for income-qualified homeowners and renters, allowing them to save at least 50% on the energy generated by the solar panels they own or subscribe to

The final word on the Climate and Equitable Jobs Act 

The promise of the CEJA cannot be overstated. Analysts all over the country agree that Illinois has taken a bold step toward creating a more equitable and effective energy system. The work of countless people went into making this bill a reality, and the effects will spread throughout the state in the coming decades. 

If you’re an Illinois homeowner, find out whether you qualify for the Adjustable Block Program or the Solar For All Program, and decide if it’s right for you, financially. If you’re a renter in the Land of Lincoln, look into joining a community solar program. Eligible renters and homeowners can also qualify for the Solar For All Program and reduce their energy bills down to half the cost.

Finally, if you’re interested in getting into the Illinois solar industry, look for resources about the coming jobs programs that will result from the passage of the CEJA. There will be a lot of exciting news in the coming months, and we’ll share it with you as soon as we can.