Upcoming Illinois Net Metering Changes: Everything You Need to Know

For many years, net metering has been a valuable billing mechanism for solar customers in Illinois. This program allowed Illinois residents to generate electricity with their solar panels and send any excess electricity back to the grid in exchange for retail credits on their utility bills, providing savings and supporting renewable energy adoption. Starting in Fall 2024, Illinois will transition from the traditional retail rate net metering to an energy-only supply credit for any solar energy exported from a home. However, current solar customers in Illinois households are also eligible for other rebates designed to unlock the full benefits of their systems.

What is changing for net metering customers in Illinois?

The new Smart Solar Billing tariff replaces the traditional net metering approach with a more dynamic and comprehensive system. Here’s what you need to know about the upcoming changes:

1. Introduction of the Smart Solar Billing tariff

The Smart Solar Billing system aims to provide a more accurate reflection of the benefits that rooftop solar and battery storage bring to both the grid and homeowners. Unlike net metering, which provides a flat credit for excess energy sent back to the grid, the new tariff incorporates several elements to ensure fair compensation:

Distributed generation (DG) rebate: Homeowners will benefit from an upfront, one-time rebate of $300 per kilowatt (kW) for the benefits that home solar systems contribute to the distribution grid over a 25-year period.

Dynamic supply pricing: The export value of home solar energy will now be based on time-of-use pricing, meaning the value of excess energy sent back to the grid will vary depending on the time of day and the current energy demand. This approach provides a more accurate and dynamic compensation for solar energy

Storage rebate: An additional one-time rebate of $300 per kilowatt-hour (kWh) will be available to help reduce the upfront costs of battery storage systems. This rebate encourages homeowners to install solar panels and pair them with battery storage, enhancing energy resilience and optimizing cost savings by storing excess energy for use when needed.

2. Long-planned transition

This transition to Smart Solar Billing was planned through legislative initiatives such as the Future Energy Jobs Act in 2016 and the Climate and Equitable Jobs Act in 2021. The goal has been to provide a sustainable, long-term rate structure that gives homeowners plenty of time to adjust to the new system, while evolving to best serve the needs of the overall electricity grid.

3. Continued benefits for solar homeowners

Illinois residents will not lose value from their solar and battery systems with these new changes. The new billing structure is designed to fully capture the benefits that these technologies bring to the grid and the state. Homeowners will continue to receive compensation for their solar energy contributions in a way that more accurately matches the needs and demands of the grid, ensuring both financial and environmental benefits remain robust.

4. Legacy existing net metering customers

Importantly, all existing Illinois net metering customers will be considered legacy systems under the current net metering rules for the life of their solar systems. This means that those who already have installed solar panels and are experiencing full net metering benefits from solar power will not be affected by the upcoming changes.

5. Illinois Shines

Regardless of the new solar tariff design, Illinois homeowners also continue to benefit from Illinois Shines. Illinois Shines is the state program that is helping Illinois meet its renewable energy targets, by making “going solar” more affordable. “With valuable incentives, step-by-step guidance, consumer protections and an emphasis on equity, Illinois Shines ensures everyone in Illinois can play a role in our clean and renewable energy future.” Learn more at IllinoisShines.com   

Homeowners are encouraged to explore these changes and consider integrating battery storage with their solar systems to maximize savings and build energy independence under the new Smart Solar Billing tariff.