Do I Qualify For Tax Credits & Incentives?
Solar Tax Credits
The Federal Solar Tax Credit currently covers 30% of the overall cost of your system. You will apply for the credit on your first tax return after installing the solar energy system on your home. Here is the thing; if you don’t pay tax, you will not get a credit. If you normally have to pay money at the end of each year then this credit will offset the amount you would normally pay. You can receive up to the FULL amount of this refund in your first filing. This credit can be used over multiple years so you won’t lose it.
The State Solar Tax Credit currently covers 25% of the overall cost of your system. You will apply for the credit on your first tax return after installing the solar energy system on your home. Like the Federal Solar Tax Credit, if you don’t pay state tax, you will not get a credit. Unlike the Federal Solar Tax Credit, your South Carolina State Solar Tax Credit is limited to receiving a maximum of $3500 per year OR 50% of your state tax liability. The state will allow the lower of the two to be used. This credit can be used over multiple years so you won’t lose it.
In order to qualify for these rebates, you must either be paying into the federal and state tax system annually or have a tax liability at the end of each year. A member of the South Carolina Solar team will help you determine how much you can qualify for and how long you can expect to see rebates.
Utilities Role in Solar Economics
Unfortunately, not all utilities are solar friendly nor do their policies reflect the intent of the states Net Metering Act. In 2014, South Carolina passed legislation which paved the way for the adoption of solar and other renewable energy for our state. Because of a lawsuit filed by Duke Energy and SCE&G, this policy didn’t take effect until early 2016 when the utilities settled with the state.
To complicate things, there are only two publicly held utilities which are mandated to follow the states Net Metering Act. 98% of all utilities in South Carolina are Cooperatives and are exempt fro this act. In dealing with many of these coop’s, we have experienced about every possible variation and process concerning solar possible.
You contractor should have vast experience in dealing with these utilities because some of their policies affect the economics of solar. Utilities such as Berkeley Electric Coop, Santee Cooper and others had decided to punish solar adoption y charging their ratepayers who switch to solar fees that other ratepayers don’t have to pay. These fees are based on the customers solar system size and these utilities claim its for the overall good of the entire client base.
Net Metering
If your utility offers Net Metering, this is as good as it gets when it comes to solar. Net Metering allows producers to see all excess back to the utility for the same retail rate they pay. At the end of the year, there is a true-up period where you and the utility settle up for and excess or overages.
Net Billing
Net billing is like Net Metering but the true-up period is selected by the utility and any excess energy you have built up is lost and forfeited to the utility. This is the program most Coop’s use with small differences in the true-up period and how the excess is handled. This option is still good for solar
Wholesale Metering
Some utilities including state owner Santee Cooper have taken the stance that they will only pay a producer a fraction of the retail rate for any overages the producer puts back on the grid. This policy on solar requires that the system size and design is such that the producer mostly self consumes all solar generation and uses it for self consumption.
Demand Charge Penalities
A very few utilities have taken the position of penalizing solar adoption by charging solar producers fees to offset their losses in revenue. How this is legal is surprising but somehow this hasn’t been challenged in a South Carolina court so this handful of utilities continues to take what they want even from ratepayers who switch to solar.
Importance of choosing the right Solar Energy Contractor
Helping our clients determine if solar is a fit for them is a process we take very seriously. When it is, deciding to switch to solar is the easiest decision you will every make. Understanding all of the details is what can make this good for you or not so good. You need to make sure you work with a reputable company that has your best interest at heart.
South Carolina Solar’s owner has been in business in South Carolina for the past 20 years. South Carolina Solar is here to stay and its ownership & employees live here, work here and are raising their kids here. We care about our customers and making sure we serve you and your best interests.
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