Comprehensive guide to South Carolina solar incentives for 2025, covering federal and state tax credits, net metering, utility rebates, and property tax exemptions to help homeowners and businesses maximize their solar investment.
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South Carolina Solar Incentives 2025: Maximizing Your Tax Benefits

South Carolina has become one of the most financially attractive states for solar energy investments. With a combination of generous federal incentives, state-specific tax credits, and utility programs, Palmetto State residents have unprecedented opportunities to save on solar installations. If you’re considering making the switch to clean energy, understanding these incentives can make a significant difference in your return on investment.

In this guide, we’ll walk you through every financial benefit available to South Carolina solar customers in 2025, show you how to qualify, and provide strategies to combine these incentives for maximum savings.

Table of Contents

• Federal Solar Investment Tax Credit (ITC)
• South Carolina’s 25% State Tax Credit
• Net Metering Policies in South Carolina
• Utility-Specific Solar Rebate Programs
• Property Tax Exemptions for Solar
• Solar Financing Options in South Carolina
• Commercial Solar Incentives in SC
• Maximizing Your Solar ROI in Upstate SC
• Frequently Asked Questions
• Conclusion

Federal Solar Investment Tax Credit (ITC)

The federal solar investment tax credit remains one of the most valuable incentives for going solar. Thanks to the Inflation Reduction Act of 2022, this credit has been extended and enhanced through 2032.

What You Need to Know for 2025

In 2025, the federal tax credit allows you to deduct 30% of your total solar installation costs from your federal taxes. This isn’t just a deduction—it’s a dollar-for-dollar reduction in what you owe the IRS.

For example, if your solar system costs $20,000, you can reduce your federal tax liability by $6,000. If you don’t have enough tax liability to claim the entire credit in one year, you can carry the remaining amount forward to future tax years.

Qualifying for the Federal Solar Tax Credit

To qualify for this incentive, you must:

• Own your solar energy system (not lease it)
• Have sufficient tax liability to claim the credit
• Install the system on your primary or secondary residence in the US

The credit applies to all system costs, including panels, inverters, mounting equipment, and labor. Battery storage systems also qualify when installed with solar or added to an existing system.

South Carolina’s 25% State Tax Credit

What makes South Carolina stand out in the solar landscape is its exceptional state tax credit, one of the most generous in the nation.

The Details of SC’s Solar Tax Credit

South Carolina offers a state income tax credit equal to 25% of your solar installation costs. This credit has an annual cap of $3,500 or 50% of your state tax liability, whichever is less. The unused portion can be carried forward for up to 10 years.

When combined with the federal credit, South Carolina residents can offset up to 55% of their solar investment through tax incentives alone.

Application Process and Documentation

To claim the SC solar tax credit, you’ll need to file Form TC-38 with your state income tax return. Make sure to keep detailed records of your solar installation costs, including contracts, invoices, and proof of payment.

Working with an experienced local installer like Sundance Power Systems ensures you receive all necessary documentation properly prepared for your tax filing.

Net Metering Policies in South Carolina

Net metering allows solar customers to receive credit for excess electricity their systems generate and feed back to the grid. In South Carolina, net metering policies have undergone several changes in recent years.

Current Net Metering Framework

As of 2025, South Carolina utilities are required to offer net metering to residential and small commercial customers. When your solar panels produce more electricity than you use, your meter runs backward, and you receive a credit on your bill at the retail rate.

However, it’s important to note that specific policies vary by utility. Some may have monthly versus annual true-up periods, which can affect your overall savings.

Utility-Specific Net Metering Programs

Major utilities in South Carolina have their own net metering programs:

• Duke Energy: Offers 1:1 credit for excess generation with monthly rollover and annual true-up
• Dominion Energy: Provides retail rate credits with similar structure to Duke
• Electric cooperatives: Policies vary by co-op, with some offering less favorable rates

Understanding your specific utility’s net metering policy is crucial for calculating your potential savings and determining optimal system size.

Utility-Specific Solar Rebate Programs

Beyond net metering, several South Carolina utilities offer additional incentives that can further reduce your solar investment.

Duke Energy Solar Rebate Program

Duke Energy offers rebates for residential and commercial customers who install solar. For 2025, residential customers can receive $0.50 per watt installed, up to $5,000. These funds are limited and distributed on a first-come, first-served basis, so applying early in the year is recommended. To take advantage of this opportunity, customers should ensure their solar systems meet the program guidelines and are installed by approved contractors. For more comprehensive information, interested parties can visit Duke Energy’s website for the duke energy solar rebate details, which outline eligibility criteria and application procedures. This initiative not only provides financial savings but also encourages sustainable energy practices in the community.

Santee Cooper Solar Programs

Santee Cooper’s Solar Home and Solar Business programs provide rebates and performance payments for qualifying systems. Their rebate structure is tiered based on system size and can provide significant upfront savings.

Other Regional Utility Incentives

Several electric cooperatives across South Carolina offer their own solar incentives, including:

• Berkeley Electric Cooperative: Community solar participation options
• Blue Ridge Electric: Special solar-friendly rate structures
• Broad River Electric: Solar loan programs with favorable terms

Check with your local utility for the most current program details, as these offerings can change annually.

Property Tax Exemptions for Solar

Adding solar to your home increases its value, but in South Carolina, you won’t pay extra property taxes on that added value.

Understanding the 100% Property Tax Exemption

South Carolina provides a 100% property tax exemption for residential solar energy systems. This means the added value that solar brings to your home is exempt from property taxes.

For example, if installing solar increases your home’s value by $15,000, you won’t pay any additional property taxes on that amount. Over decades of system ownership, this can save thousands in property taxes.

How to Ensure You Receive the Exemption

In most counties, this exemption is applied automatically when your system is permitted and interconnected. However, some local tax assessors may require additional documentation.

When working with Sundance Power Systems, we handle the necessary paperwork to ensure your system qualifies for this valuable exemption. Our team’s familiarity with local requirements across Upstate SC ensures you don’t miss out on this benefit.

Solar Financing Options in South Carolina

Even with substantial incentives, the upfront cost of solar can be significant. Fortunately, South Carolina residents have several financing options to make solar more accessible.

Solar Loans

Many South Carolina credit unions and banks offer specialized solar loans with competitive interest rates. These loans allow you to own your system (and therefore claim available tax credits) while spreading payments over time.

The structure of these loans often includes no money down and monthly payments lower than your current electric bill, creating immediate positive cash flow.

Cash Purchase vs. Financing Comparison

While cash purchases provide the highest overall return on investment, financing can make solar accessible with little or no money down. Let’s compare typical scenarios:

• Cash purchase: Highest lifetime savings, quickest payback period (typically 6-8 years in SC)
• Solar loan: Little to no money down, positive cash flow from year one, slightly longer payback period
• Solar lease: Not recommended for most SC residents as you forfeit valuable tax credits

For most South Carolina homeowners, a solar loan provides the best balance of accessibility and financial benefits, allowing you to claim tax incentives while avoiding large upfront costs.

Commercial Solar Incentives in SC

South Carolina businesses have access to additional incentives beyond those available to residential customers.

Business-Specific Tax Benefits

Commercial solar installations in South Carolina qualify for the same federal and state tax credits as residential systems. However, businesses can also take advantage of:

• Modified Accelerated Cost Recovery System (MACRS): Allows businesses to depreciate solar assets over just 5 years
• Bonus depreciation: Additional first-year depreciation benefits
• Business energy investment tax credits: Additional incentives for certain commercial applications

ROI Analysis for Commercial Solar

When all incentives are applied, commercial solar systems in South Carolina typically provide payback periods of 4-6 years, followed by decades of reduced operating costs.

For businesses with high daytime energy usage—such as manufacturing facilities, retail spaces, and office buildings—solar can significantly reduce demand charges in addition to energy charges.

Maximizing Your Solar ROI in Upstate SC

To get the most value from solar in South Carolina, consider these strategies developed through Sundance Power’s nearly three decades of experience in the region.

Optimal System Sizing

Right-sizing your solar system is crucial for maximizing financial returns. In South Carolina, we typically recommend sizing systems to offset 100-110% of annual electricity usage due to the favorable net metering policies currently in place.

With Sundance Power’s custom design approach, we analyze your energy usage patterns, roof orientation, shading, and other factors to determine the ideal system size for your specific situation.

Timing Your Installation

While solar incentives in South Carolina are strong for 2025, some utility rebate programs have limited funding that may run out early in the year. Starting the solar process in Q1 or Q2 gives you the best chance to capture all available incentives.

Additionally, planning your installation to complete before tax season allows you to claim incentives sooner rather than later.

Combining Incentives Effectively

The most successful solar customers in South Carolina strategically combine all available incentives:

• Apply for utility rebates as soon as they become available
• Claim both federal and state tax credits in the same tax year as installation
• Consider energy efficiency upgrades in conjunction with solar to qualify for additional incentives
• Work with experienced solar professionals who understand the local incentive landscape

At Sundance Power Systems, we provide detailed financial analyses showing how these incentives work together to maximize your return on investment.

Frequently Asked Questions

Conclusion: Taking Action on Solar in 2025

South Carolina’s combination of abundant sunshine and generous incentives makes 2025 an ideal time to invest in solar energy. With federal and state tax credits covering up to 55% of system costs, property tax exemptions, and favorable net metering policies, the financial case for solar has never been stronger.

As you consider making the switch to clean energy, working with an experienced local installer makes a significant difference in maximizing your benefits. Sundance Power Systems has been empowering Western North Carolina and Upstate South Carolina with solar since 1995, bringing decades of expertise to every installation.

Our systematic approach ensures you receive properly designed systems that maximize energy production and financial returns, while our deep understanding of local incentives helps you capture every available benefit.

Ready to learn how much you could save with solar? Contact Sundance Power Systems today at (828) 645-2080 for a free consultation and custom proposal that details all applicable incentives for your specific situation.