Close call for Illinois solar program funding

By Mark Burger

The Land of Lincoln drama over operating for over two years without a budget ended on July 6, with legislative approval over a gubernatorial veto. Among the many programs threatened in Illinois were the solar programs in the Future Energy Jobs Act (FEJA, also known as SB 2814), which was signed into law last December and technically took effect on June 1.  While the funding under FEJA was immune from being raided or “swept” for general revenue purposes (a popular Illinois political pastime), funding critical to the start up of FEJA programs, such as Illinois Solar For All, was not. But, buttressed by bipartisan political support and a near unanimous legislative resolution, the Renewable Energy Resource Fund (RERF) was protected and FEJA solar program development will continue.

RERF was created back in 2014 to fund renewable energy credits (REC) for wind and solar programs. There were technical issues in linking REC funding to actual solar installations being built in Illinois, which was resolved in the FEJA legislation. However, that caused a buildup of around $187 million dollars in the Fund, a tempting target for sweeping by a revenue starved state. Ironically, the lack of a budget to plug holes enabled the RERF to survive.

According to the Chicago-based Environmental Law and Policy Center and Illinois Comptroller reports, the Fund lost about $12 million to the Illinois Commerce Commerce Commission, plus $27 million that will go toward REC solar contracts. The remaining approximately $146 million will be set aside for the Illinois Solar For All Program, designed for low and moderate income households to get solar power at below retail rates, whether directly on their roofs or through community solar projects. The Illinois Power Agency (IPA), responsible for implementing the FEJA renewable energy programs, will get an initial $50 million for startup and operations, with the approximately $96 million to be appropriated later.

Meanwhile, the IPA is working on the program rules, having completed a round of workshops and responses to comments from outside working groups. According to their timeline, IPA is expected to release draft program rules at the beginning of August for an approximately month long comment period, and submit the final rules to the Illinois Commerce Commission (ICC) by November. Approval is expected by early 2018, enabling the IPA to retain program administrators by the spring, with actual program launching in the second half of the year.

The FEJA solar programs have been the biggest change in Illinois for two decades, and expect to place the state as a markets leader befitting its status as the 5th-largest energy user, and state with the 6th-largest wind capacity.  An early Midwest leader in solar programs with the Renewable Energy Trust Fund launched in 1997, Illinois suffered from having its static $5 million dollar annual appropriation partially or fully swept on a regular basis to plus general revenue budget gaps. Along an ineffective renewable portfolio standard for solar, this was a prime factor in the Prairie State falling out of consideration as a major solar market by the mid 2000’s.