How Much Can You Save on Solar in South Carolina?
South Carolina receives about 4,64 kilojoules per square meter of annual sunlight, ranking it 14th in solar generation in America. According to the Solar Energy Industries Association (SEIA), as of 2023, solar installations in South Carolina generate up to 2099 Megawatts. This accounts for about 3% of the state's total electricity and powers about 244,991 homes.
As of 2023, online commercial customers and businesses in South Carolina have the option of 100% renewable energy.
State and Federal Solar Energy Incentives Available in South Carolina
|South Carolina Solar Incentives||State or Federal Incentive||Program Overview|
|South Carolina Solar Tax Credit||State||South Carolina residents can claim 25% of the solar system cost as a tax credit.|
|Utility-based solar power incentive||State||Some utilities in the state offer rebates to cover the cost of the solar power system.|
|Net Metering||State||Residents are allowed to bank and resell their excess generated solar energy back to their utility provider.|
|Federal Solar Tax Credit||Federal||Residents can claim up to 30% of the cost of their solar system as a tax credit.|
The Federal Solar Tax Credit is an incentive offered to homeowners who go solar. It allows a homeowner to apply up to 30% of the cost of their solar installation as a tax credit.
Also known as the Investment Tax Credit (ITC), the federal solar tax credit applies to both commercial and residential solar systems. There is also no cap on how much the value of the tax credit can reach.
This allows taxpayers in any tax bracket to be eligible for the tax credit. After ten years, in 2033, the 30% tax credit will be reduced to 26%. Taxpayers who leverage the 30% Federal Solar Tax Credit can cover the following costs.
For anyone unsure that they qualify, listed below are the eligibility criteria for the Federal Solar Tax Credit.
The solar system must have been purchased outright. The system must not have been leased or obtained via a power purchase agreement.
The solar photovoltaic system must have been purchased and installed between January 1st, 2006, and December 31st, 2034.
The system must have been installed in the taxpayer’s primary or secondary residence in the United States.
The system must be new and is being used for the first time. This tax credit can only be claimed on the initial installation of the system and equipment. For example, if an individual purchases a property with a preinstalled system, it cannot be claimed.
For any off-site community project, the IRS allows taxpayers to claim Section 25D Credit. The Federal Solar Tax Credit can be claimed for purchasing a part of the project. This holds if the electricity generated is credited against and does not exceed the home’s needs.
Claiming the federal tax credit or solar investment tax can be done in a few easy steps.
Homeowners are eligible for the ITC if they own their solar system completely. The system must also be installed in their primary or secondary U.S. residence. A list of eligibility criteria is available in the Office of Energy Efficiency, Homeowner's Guide to the ITC.
After confirming eligibility, there are a number of forms that must be filled out and submitted. First off is the IRS Form 5695, which validates and calculates which credits you are entitled to.
After completing Form 5695, add the calculated information to the Schedule 3 section. Finally, add or attach all these to the individual tax return form IRS Form 1040. Full instructions for IRS Form 1040 can be found online on the IRS website. The information should be added to line 20 in Form 1040, and the form submitted as usual.
Net Metering is the process where individuals with solar power systems bank and sell excess power. Utility companies buy back this excess power and give customers credit for their next electricity bill
Net metering agreements can be for commercial, industrial, or residential customers with solar energy installations.
Customers who generate excess power can bank and sell the extra energy to their utility company. The utility company then gives them the excess power as a credit on their next power bill. The agreement essentially gives homeowners credit for any Kilowatts-hr returned to the utility’s power grid.
The value of this credit can vary by the utility company or even by state. One of the more popular rates offered is one-to-one net metering. One-to-one net metering simply means the consumer's excess is valued as equal to the utility’s power.
However, homeowners should note that some utility companies will offer credit at less than one-to-one. Some rates will vary based on the season, the type of property, and so on.
Consumers are advised to contact utility companies directly for information about their Net Metering program. Some third-party comparison sites and energy-saver tools can be used to find the best rates.
Enrolling for Net Metering in South Carolina will defer based on the chosen utility company. Interested parties are advised to contact utility companies directly to learn their net metering
policies. Customers may also use third-person comparison websites to research and choose which is best for them.
Taxpayers in South Carolina can claim a tax credit when they install renewable energy systems. The South Carolina Solar Tax Credit allows taxpayers to claim 25% of the cost of their system. The max amount for this credit is $35,000 or 50% of their tax liability that year.
The total credit will be matched to whichever of the two amounts is lower. The maximum tax credit amount, which can be each year, is about $3,500. Luckily, the tax credit does not expire, and any excess will roll over to the next year.
The South Carolina Solar Tax Credit will continue to roll over for ten years. This tax exemption was expanded to include small hydropower and geothermal systems.
Application for the South Carolina Solar Credit is quick and simple. Taxpayers download and fill out the South Carolina solar tax credit form. The completed form should be attached to their normal tax return form IRS Form 1040.
South Carolina has substantial hydroelectric power-generating capabilities. As of 2023, the state had 34 utility-grade hydroelectric generating plants of 1 Megawatt or higher.
South Carolina is ranked third among states with the most pumped storage hydro-power capacity. This accounted for around 3% of the state's net power generation in 2021. Other main sources of renewable energy include biomass generation using wood and wood waste. This is sourced from South Carolina’s vast woods and forests.
There are also landfill gas-fueled generation plants utilizing methane gas. In 2022 110,000 acres of offshore coastline were leased for wind energy development.
The Energy Information Administration(EIA) estimated 7% of the total in-state energy generation was from renewable energy. This report from 2021 ranked solar, biomass, and hydro-power as South Carolina’s top renewable energy sources.
The largest total percentage of power generation in South Carolina comes from nuclear energy. This accounted for about 54% of in-state electricity generation in 2021, according to the EIA report. As of 2023, there are seven operational reactors at four working nuclear power plants in the state.
At the end of 2021, renewable sources fueled about 12% of the state's larger utility-scale facilities. The state also offers financial incentives for households and businesses to install renewable energy sources.
The total energy consumption per capita of South Carolina is estimated to be 298.9 million Btu. Residences account for about 70.1 million Btu, while commercial establishments account for 49.6 million Btu. Industries and transportation account for 94.9 million and 84.3 million Btu, respectively.
According to the U.S. Census Bureau report in 2022, South Carolina was home to 5,282 634 residents with about 2.5 people per household.
According to the report, there were 2,395,943 housing units, 70% being owner-occupied units. The median value of these owner-occupied units was around $181,800. In 2022 it was estimated that 50,860 building permits were issued in South Carolina.