Solar power generation in South Carolina has grown by almost 140% since the beginning of 2020, due in part to a growing number of residential solar panel installations. South Carolina also receives lots of sunshine, making it prime solar territory.
Powering your home with a solar panel system can help you save on your electric bill. And while traditional energy prices have increased in recent years, the cost of residential solar panels has decreased by more than 64% since 2000, according to a report from the Lawrence Berkeley National Laboratory.
Federal, state and local tax credits and incentives can lower the cost of solar panels even more. South Carolina has a state solar tax credit that you can combine with the federal tax credit to maximize your savings on solar panels.
Here’s what you need to know about going solar in South Carolina.
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Best national solar panel companies in South Carolina
Local solar panel companies in South Carolina
National solar companies aren’t your only options. A local installer might offer you a better estimate, so make sure to compare multiple quotes. Here are a few local solar companies worth considering.
How to determine which solar company in South Carolina is best for me
Solar panel systems are expensive, so you want to make sure you’re picking the right installer for the job. Here are some tips to help you find a reputable installer.
- Understand federal, state and local solar incentives.
- Read online reviews from multiple sources. Google and Yelp are a good place to start.
- Get recommendations from neighbors who have solar installed.
- Check an installer’s licensing and certifications. Look for installers who are certified by NABCEP.
- Compare multiple solar quotes.
- Ask your installer all your questions, even the difficult ones.
- Assess your potential savings cost and your solar payback period. Your installer should be able to explain this to you.
Average cost of solar panels in South Carolina
Here’s a look at the average cash price for a 5-kilowatt system before factoring in tax credits incentives, according to data from FindEnergy.com. But your system might become more expensive if you choose to include solar batteries or additional equipment in your purchase.
South Carolina solar panel costs
|System size (kW)||Price per watt||Total cost|
South Carolina solar panel incentives or rebates
While the average cost of a solar panel system in South Carolina is higher than the national average, there are solar tax incentives, rebates and credits to make solar more affordable.
The Residential Clean Energy Credit is a federal solar tax incentive offered in all 50 states that credits 30% of the total cost of a solar system to consumers who purchase solar panels. Previously known as the Investment Tax Credit, this incentive was increased and extended when the Inflation Reduction Act was passed in August 2022. There is no cap on how much you can claim with this tax credit, so you can receive the full 30% no matter how much your solar panel system costs.
If you purchase solar panels, you can apply for the Residential Clean Energy Credit by following the instructions provided by the IRS and filling out IRS form 5695 (PDF). Once your application is approved, you will receive 30% of the cost of your system in credit when you file your annual federal tax return.
There are also various state and local solar tax credits and financial incentives available in South Carolina. The Database of State Incentives for Renewables and Efficiency offers a comprehensive list of South Carolina solar incentives. Here are a few you should know about.
|South Carolina Solar Tax Credit||This state-level solar program offers a tax credit of 25% of the cost of a solar panel system back to residents. The tax credit is capped at $35,000 or 50% of the taxpayer’s tax liability for the year.|
|Santee Cooper Rooftop Solar Rebate Program||Santee Cooper customers who install solar panel systems on their homes receive a rebate of up to $5,700.|
|Property Tax Exemption||South Carolina offers a property tax exemption for renewable energy systems (including solar panel systems) with a capacity of 20kW or less.|
|Net Metering Programs||Net metering lets consumers sell excess solar power produced by their solar panels back to the grid. In exchange, consumers receive a credit on their electricity bills. Your solar system must remain connected to the grid to participate in net metering.|
How to pay for solar panels in South Carolina
As with any major purchase, you will want to think about how to finance the cost of solar panels. Keep in mind, the money from the tax credit won’t be yours until after you’ve filed your taxes for the year the panels are installed. It’s also important to factor in the solar payback period, which is the time it takes to recoup your upfront investment and when savings begins.
Here are some ways to pay for solar panels:
Cash: This approach only works if you happen to have thousands of dollars sitting around in a bank account. If you don’t have that yet, but you want solar panels in the future, consider saving money in a high-yield savings account. Interest rates are high right now, and this can help you save faster.
Solar loan: Your solar installer likely has a relationship with a bank or other financial institution to offer a loan designed for solar panels. This can be a great deal, but you’ll want to get multiple offers to ensure the rates and terms are the best.
Lease or power purchase agreement: Some solar companies allow you to lease your system or enter a power purchase agreement. If you choose to lease, you won’t own the solar system, you’ll just pay for use of the equipment. Entering a power purchase agreement means you’ll buy solar energy generated from the solar company to power your home. The price you’ll pay is usually lower than the retail rate from your local utility company. Note that not all incentives are available with a lease or power purchase agreement.
Personal loan: You can also borrow the money through a personal loan. The main difference between a personal loan and a home equity loan is that a personal loan is typically unsecured. That means your house isn’t at risk. The downside is they tend to have shorter terms and higher interest rates than home equity products.
Home equity: You don’t have to use a loan from your solar company. Financial institutions offer home equity loans and lines of credit (or HELOCs) that are commonly used for home improvement projects. These loans can be used for basically any purpose, and they may be a good fit for your solar project. Shop around and make sure you’re getting the best deal.
Installation factors to consider
Purchasing or leasing solar panels is a big decision. Before you sign a contract, you must consider the investment from all angles. Here are some installation aspects to think about beforehand.
- Your roof’s condition: The age, shape and slope of your roof will affect how much electricity a solar system can generate. For example, the Department of Energy says solar panels will be most efficient (and produce more power) on roofs sloping between 15 and 40 degrees. If your roof is old or needs repairs, you may have to replace it before installing solar panels.
- Your HOA or neighborhood requirements: HOAs cannot ban solar panel installations in South Carolina. However, your neighborhood may have specific requirements or approval processes. Be sure to check before installing solar panels on your property.
- Your insurance policy: Once your solar panels are installed, you should contact your homeowner’s insurance agency to update your policy to include the panels. Most standard home insurance policies can include solar panels, so you shouldn’t need a separate policy. However, you should check with your agency to confirm the details.
- Your location: While solar panels can generate electricity in indirect sunlight, they will be much more efficient when they get at least 4 hours of direct sunlight per day. South Carolina has more sunny days each year than the national average. However, if your roof has a lot of shade coverage, this is an important factor to consider before deciding.
- Your living situation: If you rent your home, you may not be allowed to install solar panels. Check with your landlord or property manager to confirm whether you can install rooftop solar. If not, community solar is another option. With community solar programs, you can subscribe to solar power produced at another location and get a credit on your energy bills. The amount you pay for this subscription should be lower than the value of the credits.
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