Columbia, SC Solar Panels

South Carolina’s Solar Energy Tax Credit allows homeowners and businesses to claim 25% of their total solar installation cost as a credit against their state income tax liability. The credit is capped at $3,500 per year and carries 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 available for 2026 installations and beyond.

Eligible technologies include solar photovoltaic (PV) panels, solar water heaters, and solar space heaters installed on a South Carolina property (primary residence or business). The credit is non-refundable, meaning it can only offset taxes you owe — but any unused portion automatically carries forward for up to 10 years, so you won’t lose the benefit if your tax liability is modest in any given year.

To claim the credit, file Form TC-38 (SCH.TC-38) along with your South Carolina state income tax return. You’ll need to include supporting documentation such as your solar system design, permits, and receipts showing total installation costs. Contact the South Carolina Department of Revenue at dor.sc.gov for the most current form and instructions.

South Carolina law provides a full 100% property tax exemption for solar energy systems installed on residential properties. This means that adding solar panels — which can significantly increase your home’s value — will not raise your property tax bill. The exemption applies to solar PV systems with a capacity of 20 kilowatts (kW) or less, and also covers advanced inverters and battery storage systems that are paired with solar.

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. However, it is a good idea to confirm the process with your county assessor’s office to ensure it has been properly applied to your account.

This exemption provides ongoing annual savings for the life of your solar system. For homeowners in Columbia in areas with higher property tax rates or larger system sizes, the cumulative savings over 20–25 years can be substantial. Visit the South Carolina Energy Office at energy.sc.gov for more information on state-level solar tax incentives.

South Carolina exempts solar energy equipment from the state’s 6% sales tax. This exemption applies at the point of purchase, meaning the savings are immediate and reduce your upfront installation cost without requiring any additional paperwork or tax filing on your part.

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 savings. While this may seem modest compared to the state income tax credit, it is an automatic benefit that stacks on top of all other available incentives.

This exemption applies to solar photovoltaic panels, inverters, racking, and other qualifying solar equipment. For more details on eligible equipment and the exemption process, visit the South Carolina Energy Office at energy.sc.gov or consult your solar installer.

South Carolina state law requires all investor-owned utilities with more than 100,000 customers to offer net metering to residential solar customers with systems of 20 kW or smaller. Under net metering, excess electricity your solar panels send to the grid earns you a bill credit that can be applied to future monthly bills. The program is capped at 2% of each utility’s average peak demand over the prior five years. Most residents of Columbia are served by Dominion Energy South Carolina, which offers 1-to-1 net metering credits with an annual true-up each November (remaining credits paid at a lower avoided-cost rate).

Because credit rates at most South Carolina utilities are well below the retail electricity rate, pairing your solar system with a battery storage system can be a smart financial move. Storing excess solar energy for self-consumption during peak hours — rather than exporting it to the grid at a discount — can significantly improve your return on investment. Most modern solar batteries include scheduling features that automate this process after initial setup.

Enrollment in a time-of-use (TOU) rate plan is required by most utilities to participate in net metering. Be sure to contact your specific utility before installation to understand all applicable fees, requirements, and current program availability, as terms can change. Use the South Carolina Energy Office’s Energy Saver Tool at solar.sc.gov to find current net metering program details for your utility.