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Solar energy for businesses set for growth

In Illinois, the next 12 months are set for significant expansion of solar array installations at businesses that traditionally just bought whatever electricity flowed through the grid and into their buildings. While both homes and businesses are eligible for a 30-percent Federal Investment Tax Credit (ITC) for solar installations, businesses can also use the Modified Accelerated Cost Recovery System (MACRS) to write off the asset depreciation on their taxes. Businesses that don't have the tax liability to directly utilize the ITC and MACRS can still take advantage of these incentives through a third-party ownership structure.

Homeowners and business owners have long been motivated to install solar arrays because they offer energy independence, cost savings and cleaner air for their communities. However, new state incentives and a local bulk purchasing opportunity are going to dramatically lower the cost of solar array installations, especially for businesses when stacked with the MACRS incentive.

The Illinois Commerce Commission recently approved the Illinois Power Authority's implementation plan for the Future Energy Jobs Act (FEJA). FEJA is the state statute that authorizes cash incentives for new solar array installations using a fee on utility bills. Small- and medium-sized businesses in Central Illinois could realize over $10,000 in state incentives for a new solar array installation, lowering payback periods to just a few short years.

For business owners who aren't sure where to start with a solar array purchase, the City of Urbana and the Midwest Renewable Energy Association are scheduling a series of Solar Power Hours in Champaign and Piatt counties as part of the Solar Urbana-Champaign program. The Solar Power Hour describes how solar panels make electricity, the financial and environmental benefits of making your own electricity and the special bulk-purchasing opportunity offered by Solar Urbana-Champaign. This program has competitively selected a solar installer offering bulk purchasing discounts. The pricing from the program installer is available to any home or business within Champaign and Piatt counties, and the pricing is fixed through the end of August. What this means for businesses interested in buying a solar array is that the process of collecting bids and selecting a vendor has already been completed, and a competitive price secured. Businesses can learn about pricing and schedule a free site assessment and proposal at the Solar Power Hours.

This year is the third for the Solar Urbana-Champaign program ( In two years, the program has installed over 1 megawatt of solar energy capacity across more than 100 homes and businesses.  While most of the past installations have been for homes, the program sponsors expect an increase in business solar installations this year. The distance between interest in and commitment to a solar installation is traditionally longer for businesses owners compared to homeowners. With two years of bulk purchase programs driving down the price while increasing the knowledge level of solar energy in our community combined with new state incentives, Central Illinois businesses are poised for big investments in solar energy.

Some business in our community have already concluded that the benefits of having your own solar power plant is compelling. A recent and visible example is Riggs Beer Company, which installed a large ground-mounted solar array as well as a pergola topped with solar panels in their beer garden. A large installation such as this can almost completely offset a monthly electric bill and over-production is credited during winter months when there is less sunshine. Even if there is only enough roof space to offset a portion of a business' electricity, every little bit counts, and it is a striking visual statement for a business. Other local businesses with recent solar installations include Loving Paws Pet Clinic, Jacobsen Dermatology, D&E

Enterprises, YWCA of McLean County and Blue Moon Organic Farm, among others. These business owners are showing that solar energy is becoming a figurative and literal fixture of businesses of all types.

Scott R. Tess is the environmental sustainability manager for the City of Urbana.