Charleston, SC Solar Panels

South Carolina’s Solar Energy Tax Credit (Form TC-38) allows homeowners in Charleston to claim 25% of their total solar installation cost against their state income tax liability. The credit is capped at $3,500 per year, with a lifetime maximum of $35,000 — or 50% of your annual state tax liability, whichever is less. There is no expiration date on this credit, making it fully available for 2026 installations and beyond.

If you cannot use the full credit in a single tax year, any unused portion carries forward to the next tax year for up to 10 years. This is especially helpful for homeowners whose annual state tax bill is lower than $3,500. Note that the credit is non-refundable — it can reduce your tax liability to zero, but you will not receive a refund check for any excess amount.

To claim the credit, file Form TC-38 (SCH.TC-38) along with your South Carolina state income tax return. You will need supporting documentation such as your solar system design, permits, and receipts showing total installation costs. The credit applies to solar PV panels and solar water heaters. Download the official form at the SC Department of Revenue website.

South Carolina offers a 100% property tax exemption for solar energy systems, meaning the added value that a solar installation brings to your Charleston home is completely excluded from your property tax assessment. This exemption applies to solar PV systems with a capacity of 20 kilowatts (kW) or less, and it also covers advanced inverters and battery storage systems that are paired with solar — a significant benefit for homeowners adding a battery backup system.

Both owned and leased solar systems are eligible for this exemption, making it accessible regardless of how you choose to finance your installation. In most cases, the exemption is applied automatically, so no separate application is required. This means you can enjoy the full financial and energy benefits of going solar without worrying about a higher property tax bill each year.

For a typical home solar installation valued between $15,000 and $25,000, this exemption can save homeowners hundreds of dollars annually in property taxes over the life of the system. Combined with the state’s 25% income tax credit, this exemption makes South Carolina one of the more solar-friendly states in the Southeast.

South Carolina provides a sales tax exemption on the purchase of solar energy equipment, exempting it from the state’s standard 6% sales tax rate. This savings is applied at the point of purchase, meaning you do not need to file any additional paperwork to claim it — the exemption is built into the transaction when you buy qualifying solar equipment through an approved installer.

For a typical residential solar installation costing between $15,000 and $25,000, the sales tax exemption translates to approximately $800–$1,500 in direct, upfront savings. This makes solar more affordable from day one, before any tax credits or rebates are even applied.

Note: Some sources have reported conflicting information about this exemption’s current status. We recommend confirming with your solar installer or the South Carolina Department of Revenue before finalizing your purchase to ensure the exemption applies to your specific equipment and installation.

South Carolina law requires investor-owned utilities with more than 100,000 customers to offer net metering for residential solar systems up to 20 kW. Under net metering, when your solar panels produce more electricity than your home uses, the excess energy is sent to the grid and you receive a credit on your electric bill. However, the specific credit rates and terms vary significantly by utility, and enrolling in a Time-of-Use (TOU) rate plan is typically required to qualify. The statewide program cap is set at 2% of each utility’s peak capacity.

Dominion Energy South Carolina (formerly SCE&G), which serves Charleston, offers 1:1 net metering, where exported solar energy earns kWh credits that carry over month to month. However, any remaining credits are true-up each November at a lower avoided-cost rate of approximately 2.8–3.4¢/kWh, and a TOU rate with a $14/month charge is required. Santee Cooper provides monthly net metering credits at $0.0416/kWh (summer) and $0.0384/kWh (non-summer). Electric cooperatives offer monthly netting with excess credits at roughly 3.8–5.9 cents per kWh.

It is important to understand that South Carolina’s net metering terms — particularly the lower avoided-cost true-up rates — are less favorable than full retail net metering offered in some other states. Before installing solar, carefully review your specific utility’s net metering tariff and rate plan requirements. You can find utility-specific program details using the EnergySaver Tool at EnergySaver.SC.GOV or by contacting your utility directly.