Solar industry says future’s bright after energy legislation signed by governor

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Jim Custer had a 2.28kW solar power system installed on his home earlier these year mainly because he was concerned about the environment, but for economical reasons as well. "I believe in global warming and I think we contribute to it," said Custer. His system thus far has produced enough energy that his electric bill has been negligible since it was installed. "I think it's an excellent deal, I got it initially because I was concerned about the environment and costs going down the road. I like it, it works well and I haven't had any hassle with it." [Justin L. Fowler/The State Journal-Register]

At 84, James Custer doesn’t expect to experience the full benefit of a solar-power system that is designed to last 25 years or more on his Springfield home.

But the retired lobbyist for the Illinois State Board of Education said he already is experiencing big savings on his monthly City Water, Light & Power bills.

And he said he was glad to see clean-energy legislation passed by the General Assembly and signed by the governor that will set in motion a total $3,200 state subsidy for his home system sometime in the next few months.

“It’s going to save me some money, and it will increase the value of the home,” he said.

Custer likes the idea of reducing his “carbon footprint” by using less electricity produced by CWLP’s coal-fired units.

“That’s cool, I think,” he said. “This is like my beginning contribution.”

The subsidy, considered an Illinois Renewable Energy Credit incentive, originally was authorized under a 2016 Illinois law, the Future Energy Jobs Act. His reimbursement, along with $300 million in backlogged funding, had been held up by a provision of the act until the Climate and Equitable Jobs Act was passed by the General Assembly and signed into law last week by Gov. JB Pritzker.

More:Prairie State Energy Campus a piece in solving Illinois’ clean-energy legislation puzzle

The wide-ranging, almost 1,000-page clean-energy bill ensured that monthly surcharges of $1.50 to $2 on the bills of Commonwealth Edison and Ameren customers — amounting to $580 million annually — can continue to be collected and flow to Illinois projects like Custer’s that expand the use of renewable energy produced by wind and solar technology.

The funding for these incentives is one of several provisions in the bill designed to make renewable energy more affordable for commercial and residential customers.

Supporters of the energy legislation, Senate Bill 2408, say the bill could result in the creation of 35,000 to 50,000 jobs in Illinois’ renewable energy sector over the next decade. 

The bill has a goal of renewable energy sources providing 40% of the state’s needs by 2030 and 50% by 2040. Renewable energy now meets 7% to 8% of the needs.

For Michelle Knox, founder and president of Springfield-based WindSolarUSA, the bill will mean customers waiting for assurances of state subsidies can proceed with their renewable energy projects. And those who have moved ahead with projects in recent months without the guarantee of offsetting state funding can be reimbursed.

A total of 1,190 residential customers and 167 commercial customers in central and southern Illinois are on waiting lists for solar project subsidies, according to the Illinois Power Agency.

In the Chicago area and other parts of northern Illinois, 4,389 residential and 618 commercial customers are waiting.

Many residential customers don’t realize how affordable installing a solar system on their home can be, Knox said.

Residential systems typically pay for themselves in seven to 12 years through reduced utility bills, she said. Commercial projects can pay for themselves in three to five years because of an additional tax incentive, she said.

Michelle Knox, founder and president of WindSolarUSA

Their view of solar power being too expensive may have formed more than 10 years ago, before state and federal incentives were available and before improvements in technology reduced the cost of solar-generating equipment by more than half, she said.

Incentive payments available through the state’s Renewable Portfolio Standard budget combined with federal tax credits reduce the installation price by 60% or more, Knox said.

That means the net cost to the owner of a 2,100-square-foot home in Springfield for a $25,875 solar system can be $9,084, and the system will pay for itself in eight to nine years through lower CWLP bills, Knox said.

Custer’s rooftop solar-panel system for his 1,400-square-foot home cost $8,784 to install in December, but his net cost will be about $3,600 after a more than $2,000 federal tax credit and his expected $3,225 payment from the state RPS program. The net cost of his system will be offset by utility bill savings in 10 to 12 years.

More:Clean-energy bill passed by Illinois House; Senate scheduled to vote on plan Monday

“Solar power is affordable for most folks nowadays with these incentives,” Knox said. 

Even lower-income families can receive benefits of solar energy, according to John Derlurey, a Chicago-based senior regional director of Vote Solar.

State funding for the Illinois Solar for All Program will more than double, to $70 million per year, because of the energy legislation, he said.

“This expansion will help tens of thousands of low-income Illinoisans tap into increased solar savings, whether it’s through the program’s community solar projects, rooftop solar projects, or even the projects enabled on community-based nonprofits and public facilities,” Delurey said.

The legislation could allow Knox’s company in the next year to match the 57 solar installations it oversaw in 2019, she said. 

The company posted $1.9 million in gross revenues and $330,000 in profits that year and contracted with a team of eight union electricians, 12 construction workers and three WindSolarUSA employees on the projects.

For customers, the energy bill “secures funding so we have a production-based incentive that is now funded again,” Knox said. “It allows us to increase our sales, which then allows us to increase the opportunities for employment.”

The resumption of solar projects also generates local and sales tax revenue and creates business for local lending institutions that often provide financing to homeowners and businesses, Knox said.

The expansion of solar power doesn’t resolve the environmental issue of where solar cells are produced — in China, which has few restrictions on coal-fired power plant emissions. And solar power equipment beyond its useful life isn’t easily recycled.

Those are issues the solar industry continues to work to address, Knox said.

Custer, who is single, had enough savings to pay up-front for his solar system. He said he is quite satisfied with the system, which transfers any excess power to CWLP’s power grid and then draws power from CWLP when the sun isn’t shining.

Knox designed a smaller but appropriately sized solar system for Custer’s house that was much less expensive than another company from which he obtained a bid, he said.

“She gets five stars, or as many as I could give,” Custer said.

Most residential solar systems in Illinois are connected to a traditional utility’s power supply in a setup known as “distributed generation,” Knox said.

More:Landmark clean energy legislation passes Senate; Pritzker pledges to sign bill into law

In CWLP territory, the value of excess solar-generated power that is sent to the CWLP system is “banked” and then credited at the retail value back to the customer’s account for residential and small commercial systems.

The systems are designed so that solar systems generate slightly more than 90% of customers’ energy costs, Knox said. Customers still must pay monthly customer charges, which, depending upon the utility, range from $15 to $45 per month.

And because the systems don’t use batteries, solar-powered homes lose electricity when there are utility power outages, Knox said.

Since Custer’s system was installed, he hasn’t had to pay for power other than the regular monthly customer charge, he said.

Custer’s solar system, which saves an estimated 2.6 tons of planet-warming carbon-dioxide from entering the atmosphere each year, makes him feel better because he is offsetting emissions from the diesel engines he uses to propel his houseboat on the Mississippi River.

“This kind of assuages my sin,” he said.

Contact Dean Olsen: dolsen@gannett.com; (217) 836-1068; twitter.com/DeanOlsenSJR.

via The State Journal-Register

September 22, 2021 at 06:58AM

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