{"id":43843,"date":"2025-10-15T09:43:29","date_gmt":"2025-10-15T14:43:29","guid":{"rendered":"https:\/\/www.citizensutilityboard.org\/?p=43843"},"modified":"2025-10-16T05:09:21","modified_gmt":"2025-10-16T10:09:21","slug":"free-solar-panels-breaking-down-solar-offers-for-illinois-consumers","status":"publish","type":"post","link":"https:\/\/www.citizensutilityboard.org\/blog\/2025\/10\/15\/free-solar-panels-breaking-down-solar-offers-for-illinois-consumers\/","title":{"rendered":"Free solar panels? Breaking down solar offers for Illinois consumers"},"content":{"rendered":"<p><span style=\"font-weight: 400;\"><strong>CLAIM:<\/strong>\u00a0 You can get free solar panels installed on your roof!\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><strong>FACT:\u00a0<\/strong> Some companies offer solar panel installation for no money down, but it\u2019s not <a href=\"https:\/\/www.citizensutilityboard.org\/wp-content\/uploads\/2022\/05\/Installing-Rooftop-Solar-Panels.png\"><img fetchpriority=\"high\" decoding=\"async\" width=\"300\" height=\"198\" class=\"alignright size-medium wp-image-34320\" src=\"https:\/\/www.citizensutilityboard.org\/wp-content\/uploads\/2022\/05\/Installing-Rooftop-Solar-Panels-300x198.png\" alt=\"\" srcset=\"https:\/\/www.citizensutilityboard.org\/wp-content\/uploads\/2022\/05\/Installing-Rooftop-Solar-Panels-300x198.png 300w, https:\/\/www.citizensutilityboard.org\/wp-content\/uploads\/2022\/05\/Installing-Rooftop-Solar-Panels-800x529.png 800w, https:\/\/www.citizensutilityboard.org\/wp-content\/uploads\/2022\/05\/Installing-Rooftop-Solar-Panels-768x508.png 768w, https:\/\/www.citizensutilityboard.org\/wp-content\/uploads\/2022\/05\/Installing-Rooftop-Solar-Panels-391x260.png 391w, https:\/\/www.citizensutilityboard.org\/wp-content\/uploads\/2022\/05\/Installing-Rooftop-Solar-Panels.png 935w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/a>free\u2014customers will be renting the panels monthly for the term of the lease (usually 15+ years).\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><strong>CUB RECOMMENDS:<\/strong> Explore your options. While leasing may make sense for some homeowners, buying your solar system outright could end up being more cost-effective.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Consumers tell CUB that sales people have knocked on their door and pitched solar panels for \u201cfree\u201d or with \u201cno money down.\u201d Sounds great, but be wary: Solar panels typically aren\u2019t free. Let\u2019s break down the different solar offers available to consumers in Illinois.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(<\/span><strong>Special note:<\/strong> <span style=\"font-weight: 400;\">There is a legitimate state-sponsored solar incentive program offered in Illinois that covers most (or sometimes all) of the cost of going solar, but those are for income-qualified customers only and are not what this blog is about. <strong><a href=\"https:\/\/www.citizensutilityboard.org\/ilsfa\/\">Read more about this income-qualified program, Illinois Solar For All.<\/a><\/strong><\/span><span style=\"font-weight: 400;\">)<\/span><\/p>\n<p><strong>Leases:<\/strong><span style=\"font-weight: 400;\"> With a solar lease, the company owns the system and you pay them monthly for the panels. While such an arrangement has been marketed as \u201cno money down\u201d or \u201cfree solar panels,\u201d that\u2019s misleading. Although it\u2019s true customers may not pay anything for the panels to be installed, they will pay the company a fixed amount each month for 15-25 years, based on the terms of the lease. Also, leases usually include a provision allowing companies to raise the price each year by 2.9 percent.\u00a0<\/span><\/p>\n<p><strong>Power Purchase Agreement (PPA):<\/strong> <span style=\"font-weight: 400;\">A PPA is similar to a lease in that the company owns the system and is allowed to annually increase the price the customer pays. However, instead of paying a fixed amount each month, the customer is charged a predetermined amount per kilowatt-hour (kWh), based on the energy produced by the system each month.\u00a0\u00a0<\/span><\/p>\n<p><strong>Ownership:<\/strong> <span style=\"font-weight: 400;\">You buy the panels outright, and you are responsible for their ongoing maintenance.\u00a0<\/span><\/p>\n<p><strong>Things to consider:\u00a0<\/strong><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">With both a lease and a PPA, because the solar company owns the panels, it benefits from the incentives that otherwise would go to the customer: a federal tax credit (covers 30 percent of project costs), Solar Renewable Energy Credits (represents the environmental benefit of 1,000 kWh\u00a0 of renewable energy generation, through Illinois Shines, the state\u2019s solar incentives program), and typically any utility rebates. Because of these incentives, a company could give you a better rate for the lease or the PPA, but\u00a0 keep in mind that the company is under NO obligation to pass down a certain amount of savings to you.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">With solar ownership, you do benefit from the incentives, but it also requires a high upfront investment for long term savings in addition to ongoing maintenance costs.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Due to the federal budget reconciliation bill passed in the summer of 2025, the 30 percent federal tax credit will be eliminated after Dec. 31, 2025 for residential solar customers who buy their panels outright. However, third-party vendors, who offer customers leases or PPAs, will still have access to the 30 percent tax credit until 2027. But the guidance is complicated:\u00a0<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Projects that \u201ccommence construction\u201d after December 31, 2025 must comply with eligibility rules related to \u201cforeign entities of concern\u201d (such as China) and payments to such entities. (For more info about \u201cforeign entities of concern,\u201d here\u2019s a good resource by The Tax Law Center: <\/span><strong><a href=\"https:\/\/taxlawcenter.org\/blog\/navigating-obbba-phaseouts-prohibited-foreign-entity-rules-and-other-new-rules#footnote-1\" target=\"_blank\" rel=\"noopener\">Navigating OBBBA: phaseouts, prohibited foreign entity rules, and other new rules<\/a><\/strong><span style=\"font-weight: 400;\">.)<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Projects that \u201ccommence construction\u201d before July 4, 2026 will have four years to be placed in service, in order to qualify for the credit. Projects that \u201ccommence construction\u201d after that date must be placed in service before the end of 2027 to qualify for the credit.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">The Department of Treasury has released updated guidance on what \u201ccommence construction\u201d means for the purpose of qualifying for the clean energy tax credit. (<\/span><strong><a href=\"https:\/\/www.utilitydive.com\/news\/treasury-commence-construction-wind-solar-tax-credits-five-percent\/757887\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\"><strong>Here\u2019s<\/strong> <\/span>Utility Dive <strong>reporting about it<\/strong><\/a><\/strong><span style=\"font-weight: 400;\">, and <\/span><strong><a href=\"https:\/\/www.irs.gov\/pub\/irs-drop\/n-25-42.pdf\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\"><strong>here\u2019s the<\/strong> <\/span>actual guidance<\/a><\/strong><span style=\"font-weight: 400;\">.)<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p><strong>CUB guidance:\u00a0<\/strong><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Before you sign a solar lease or PPA, find out how much it would cost to buy your system outright, and, if necessary, finance it. Many of the leasing companies themselves provide this option, but CUB recommends getting quotes from at least three different installers. If you would like to learn more about ways to finance your solar project please see <\/span><strong><a href=\"https:\/\/ipa.illinois.gov\/content\/dam\/soi\/en\/web\/ipa\/documents\/20250626-homeowner-handout-illinois-shines-solar-loan-financing-v250626.pdf\" target=\"_blank\" rel=\"noopener\">Illinois Power Agencies solar financing fact sheet.<\/a><\/strong><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">If you\u2019re considering a lease or PPA, make sure to read through the agreement carefully to clearly understand what you\u2019re signing up for. Also, check with the solar company about the tax credit\u2013whether the project would qualify for one given the new restrictions outlined above, and, if so, whether the company will share the benefit with you.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">If you plan to own the solar panels, then check with the installer to see if you can get the work done before the solar tax credit is eliminated at the end of the year for people, like you, who own their panels.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">\u00a0You should be sure to inquire about the price escalators of a lease or a PPA before signing the agreement to ensure you are set to see savings with the price escalator included. In the long run, savings can be lower than owning your system. Unfortunately, the payback period for your system will be increasing due to the sunset of the tax credit.<\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>CLAIM:\u00a0 You can get free solar panels installed on your roof!\u00a0 FACT:\u00a0 Some companies offer solar panel installation for no money down, but it\u2019s not free\u2014customers will be renting the panels monthly for the term of the lease (usually 15+ years).\u00a0 CUB RECOMMENDS: Explore your options. While leasing may make sense for some homeowners, buying your solar system outright could end up being more cost-effective. Consumers tell CUB that sales people have knocked on their door and pitched solar panels for \u201cfree\u201d or with \u201cno money down.\u201d Sounds great, but be wary: Solar panels typically aren\u2019t free. Let\u2019s break down the different solar offers available to consumers in Illinois.\u00a0 (Special note: There is a legitimate state-sponsored solar incentive program offered in Illinois that covers most (or sometimes all) of the cost of going solar, but those are for income-qualified customers only and are not what this blog is about. Read more about this income-qualified program, Illinois Solar For All.) Leases: With a solar lease, the company owns the system and you pay them monthly for the panels. While such an arrangement has been marketed as \u201cno money down\u201d or \u201cfree solar panels,\u201d that\u2019s misleading. Although it\u2019s true customers may not pay anything for the panels to be installed, they will pay the company a fixed amount each month for 15-25 years, based on the terms of the lease. Also, leases usually include a provision allowing companies to raise the price each year by 2.9 percent.\u00a0 Power Purchase Agreement (PPA): A PPA is similar to a lease in that the company owns the system and is allowed to annually increase the price the customer pays. However, instead of paying a fixed amount each month, the customer is charged a predetermined amount per kilowatt-hour (kWh), based on the energy produced by the system each month.\u00a0\u00a0 Ownership: You buy the panels outright, and you are responsible for their ongoing maintenance.\u00a0 Things to consider:\u00a0 With both a lease and a PPA, because the solar company owns the panels, it benefits from the incentives that otherwise would go to the customer: a federal tax credit (covers 30 percent of project costs), Solar Renewable Energy Credits (represents the environmental benefit of 1,000 kWh\u00a0 of renewable energy generation, through Illinois Shines, the state\u2019s solar incentives program), and typically any utility rebates. Because of these incentives, a company could give you a better rate for the lease or the PPA, but\u00a0 keep in mind that the company is under NO obligation to pass down a certain amount of savings to you.\u00a0 With solar ownership, you do benefit from the incentives, but it also requires a high upfront investment for long term savings in addition to ongoing maintenance costs.\u00a0 Due to the federal budget reconciliation bill passed in the summer of 2025, the 30 percent federal tax credit will be eliminated after Dec. 31, 2025 for residential solar customers who buy their panels outright. However, third-party vendors, who offer customers leases or PPAs, will still have access to the 30 percent tax credit until 2027. But the guidance is complicated:\u00a0 Projects that \u201ccommence construction\u201d after December 31, 2025 must 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