Labor & Employment Law Update

Illinois’s renewable energy landscape shifted significantly back on January 8, 2026, when Governor Pritzker signed the Illinois Clean and Reliable Grid Affordability Act (CRGA). Among its many provisions, one significant change stands out for developers, EPCs, investors, and contractors who perform the underlying construction of green energy projects: a major expansion of project labor agreement (PLA) requirements.

While PLAs have long been required for many utility-scale solar and wind projects participating in Illinois Power Agency (IPA) procurement programs, the CRGA expands those requirements into new areas of Illinois’s renewable energy market.

Which Renewable Energy Projects Are Now Subject to Project Labor Agreement Mandates?

Under the CRGA, PLAs now apply to:

• Community solar projects above 3 MW of capacity;
• Energy storage projects; and
• Geothermal systems 142 tons or larger.

That’s a big deal, especially for community solar developers who’ve historically operated outside PLA mandates and contractors who want to independently operate free and clear of certain union collective bargaining agreements.

The Illinois Power Agency's Role in Project Labor Agreement Approval

Remarkably, the IPA does not have a model or standard PLA for projects that require one. Further, any PLAs that have been submitted to the IPA for approval are purportedly confidential and will not be shared with the public.  However, under Section 1-75(c)(1)(Q)(2) of the Illinois Power Agency Act, all PLAs submitted for approval must, at a minimum:

1. Provide the names, addresses, and occupations of the owner of the plant and the individuals representing the labor organization employees participating in the PLA consistent with the Illinois Project Labor Agreements Act (PLA Act); and
2. Specify the terms and conditions as required by the Illinois Power Agency Act.

Minimum PLA Requirements Under Illinois Law

Under the PLA Act, a PLA in Illinois must:

• Set forth effective, immediate, and mutually binding procedures for resolving jurisdictional labor disputes and grievances arising before the completion of work.
• Contain guarantees against strikes, lockouts, or similar actions.
• Ensure a reliable source of skilled and experienced labor.
• For minorities and women as defined under the Business Enterprise for Minorities, Women, and Persons with Disabilities Act, set forth goals for apprenticeship hours to be performed by minorities and women and set forth goals for total hours to be performed by underrepresented minorities and women.
• Permit the selection of the lowest qualified responsible bidder, without regard to union or non-union status at other construction sites.
• Bind all contractors and subcontractors on the public works project through the inclusion of appropriate bid specifications in all relevant bid documents.
• Include such other terms as the parties deem appropriate.

Potential Impact of Expanded PLA Mandates on Contractors and Developers

While BIG LABOR and their allies will say otherwise, expansion of PLAs in Illinois have generally resulted in:

• Increased labor costs with fewer efficiencies since multi-labor unions want a “piece of the work” to be performed;
• Increased administrative oversight and red-tape that requires additional paperwork and documentation;
• Increased potential fines and penalties for all involved;  
• Increased potential jurisdictional infighting amongst labor unions claiming certain work functions; 
• Decreased competition with a majority of contractors abandoning the work due to the PLA mandates and others consolidating their market share; and
• Decreased employee take-home pay due to certain labor unions dictating that employers make contributions to union benefit funds requiring union membership and subject, in part, to union vesting rules versus making prevailing wage fringe benefit payments directly to the non-union worker. 

What Developers, EPCs, Investors, and Contractors Should Do Next

PLAs in the Illinois green energy space have become increasingly complex and the CRGA makes clear that they will play an even larger role in this sector moving forward. Developers, EPCs, investors, and contractors evaluating solar, energy storage, or geothermal projects should account for PLA obligations early in the planning process rather than treating them as a downstream compliance issue. For contractors, that means carefully reviewing any proposed PLA alongside the applicable collective bargaining and related trust fund agreements, understanding the practical short-term and long-term obligations imposed by these contracts, and evaluating the positions and flexibility of the trade unions involved.

As PLA requirements continue to expand across Illinois's renewable energy market, early assessment and strategic planning will be increasingly important to avoiding costly surprises later in a project.