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When people think of solar energy, the first thing that comes to mind is saving money on electric bills. And while that’s true over time, the reality is that installing a solar energy system comes with an upfront investment that can feel intimidating. Between equipment, labor, permits, and ongoing maintenance, the total price tag adds up quickly.

The good news? Federal and state incentives can significantly reduce that cost and make the switch to solar more attainable than ever. In this blog, we’ll break down the real costs of going solar and show you why the return on investment (ROI) is often faster and higher than most people realize. 

To give you a real-world example, let’s look at one of Halo’s recent projects. A small family-owned business in Central Illinois decided to make the switch to solar in 2024. We designed and installed a 78.7 kW DC system, which included 165 solar panels and two inverters.

• Upfront system cost: $216,700 

At first glance, that’s a daunting figure. But after applying federal and state incentives, the actual cost dropped dramatically. Here’s how: 

• Illinois MACRS Depreciation: Businesses can use the Modified Accelerated Cost Recovery System to recover the cost of solar equipment over five years. For this project, it reduced costs by $8,152. 

• Federal Bonus Depreciation: In 2023, this was set at 80% (declining by 20% each year until 2027). This project qualified for a deduction of $44,207. 

• Federal Solar Investment Tax Credit (ITC): Still one of the largest incentives available, the ITC provided a 30% credit on the gross cost, cutting $65,010 from the total. 

• Illinois Shines Program (SRECs): Illinois supports renewable energy through Solar Renewable Energy Credits. This project earned incentives worth 23.5% of the system cost, reducing it by $51,057. 

After applying all incentives, this business’s net cost for the system came to just $48,274, more than an 80% reduction from the original price tag. But the financial impact doesn’t stop there; solar continues to pay for itself as it reduces your electrical bills. With lower electrical bills and both state and federal incentives, the ROI of this project comes out to 321.4% with a 4.1-year payback period.  

Incentives like the Federal Tax Credit and Federal Bonus Depreciation are set to decline in the coming years. That’s why now is the best time to invest in solar while the financial benefits are at their peak. For this small Central Illinois business, solar wasn’t just an investment in sustainability; it was a smart financial move that will keep paying dividends for decades to come. Are you ready to take control of your power?  

To learn more about Halo Solar, contact us today and follow us on Facebook, Instagram, and LinkedIn.

Source: What Is Bonus Depreciation For Commercial Solar Projects (2025) | 8MSolar