South Carolina's solar case in 2026 is built on an unusually generous state tax credit — 25% of system cost, capped at $3,500, carrying forward for 10 years. That's one of the longest carryforward periods of any state solar credit in the country. Combined with 5.0 peak sun hours, Dominion Energy SC's $0.157/kWh rate, and full retail net metering, payback runs 8–11 years for most homeowners. It's not a headline state for solar, but the numbers are solid.
Disclaimer: All cost and savings estimates use Lawrence Berkeley National Laboratory Tracking the Sun 2024 cost data and EIA Electric Power Monthly 2025 rate data. Section 25D residential solar credits expired December 31, 2025. Get at least three installer quotes before deciding.
Key Takeaways
- South Carolina’s 25% state income tax credit (max $3,500, 10-year carryforward) is one of the longest-running state solar credits still active in the Southeast
- Dominion Energy SC averages $0.157/kWh with full retail net metering
- South Carolina averages 5.0 peak sun hours/day — solid production comparable to Georgia and North Carolina
- Estimated payback: 8–11 years after applying the state credit
South Carolina Solar Costs in 2026
South Carolina's install costs are competitive — approximately $2.70–$2.90/watt. An 8 kW system costs roughly $21,600–$23,200. After South Carolina's 25% state income tax credit (capped at $3,500), net cost drops to approximately $18,100–$19,700.
The 10-year carryforward provision is unusually generous. If your South Carolina income tax liability is less than $3,500 in year one, the unused portion carries forward for 10 additional years — meaning most homeowners will capture the full credit even if it takes multiple years.
| System Size | Cost at $2.80/W | 25% SC Credit (max $3,500) | Net Cost After Credit | Annual Production (5.0 hrs) |
|---|---|---|---|---|
| 6 kW | $16,800 | –$3,500 | $13,300 | ~10,900 kWh |
| 8 kW | $22,400 | –$3,500 | $18,900 | ~14,600 kWh |
| 10 kW | $28,000 | –$3,500 | $24,500 | ~18,200 kWh |
Note that the $3,500 cap means the credit's percentage benefit declines for larger systems. An 8 kW system at $22,400 receives an effective 15.6% credit (not 25%) because the $5,600 that 25% would yield is capped at $3,500.
South Carolina's 25% Solar Tax Credit
South Carolina Code §12-6-3587 provides a 25% income tax credit for solar energy installations. It's one of the few active residential solar credits remaining in the Southeast after most state programs expired or were repealed.
Key details:
- Credit rate: 25% of eligible solar installation costs
- Cap: $3,500 per installation (not per year)
- Carryforward: up to 10 years — an unusually long window
- Credit type: South Carolina income tax credit (nonrefundable)
- Eligible equipment: solar PV panels, inverters, and related installation costs
According to Lawrence Berkeley National Laboratory's Tracking the Sun 2024, South Carolina's solar market has grown significantly as the state's combination of incentives and sun resource has attracted installer competition — holding install costs below the national average.
Dominion Energy SC: Net Metering and Rates
Dominion Energy South Carolina offers full retail net metering for residential solar systems. Each exported kWh earns a credit at the same $0.157/kWh retail rate — no avoided-cost penalty, no reduced rate for exports. Annual net excess generation settles at a defined rate, but for right-sized systems this rarely applies.
The $0.157/kWh rate is moderate — higher than Texas ($0.131/kWh) and comparable to North Carolina ($0.148/kWh). Combined with South Carolina's 5.0 peak sun hours and the $3,500 state credit, the annual benefit calculation looks favorable:
For an 8 kW system producing 14,600 kWh with 85% self-consumption:
- Annual self-consumption savings: 12,410 kWh × $0.157 = $1,948/year
- Annual export credit: 2,190 kWh × $0.157 = $344/year
- Total annual benefit: ~$2,292/year
- Net cost after state credit: $18,900
- Estimated payback: ~8.2 years
Beyond Dominion: Other South Carolina Utilities
Not all South Carolina is served by Dominion. Duke Energy Carolinas serves the western upstate area, and a network of electric cooperatives (Santee Cooper, various EMCs) serves significant portions of rural South Carolina. Policies vary by provider.
| Utility | Solar Export Policy | Impact on Payback |
|---|---|---|
| Dominion Energy SC | Full retail net metering | Favorable (8–10 yr est.) |
| Duke Energy Carolinas (SC portion) | Avoided cost (~$0.04/kWh) | Less favorable (12–15 yr est.) |
| Santee Cooper | Net metering, retail rate | Favorable |
| Rural EMCs | Varies by cooperative | Confirm before installation |
Duke Energy Carolinas customers in western South Carolina face the same avoided-cost export structure as North Carolina customers — approximately $0.04/kWh. The South Carolina state credit still applies regardless of utility, but payback stretches considerably in Duke territory.
What to Do Next
Confirm your utility and its specific net metering terms.
South Carolina’s solar market has meaningfully different economics by utility. Dominion Energy SC customers get a straightforward full retail net metering case; Duke customers in the upstate face a much harder ROI. Know your utility before running any numbers.
Model the state credit’s carryforward if your tax liability is low.
South Carolina’s 10-year carryforward is a genuine advantage, but it shifts the timing of your credit benefit. If you typically owe $1,000–$1,500 in South Carolina income tax per year, the $3,500 credit may take 2–3 years to fully capture. This doesn’t change the total value, but affects your cash flow planning.
Get quotes and run your numbers before installer meetings.
South Carolina has a growing installer market with active competition in Charleston, Columbia, and Greenville. EnergySage and SolarReviews both cover South Carolina well. Three competing quotes typically saves $1,500–$3,000 on a comparable system.
See your South Carolina payback in one minute
Enter your Dominion Energy rate, annual usage, and ZIP code — get an estimate with the SC state credit applied and no email required.
Considering solar + battery? South Carolina’s full retail net metering makes battery storage less urgent than in Hawaii or California — but resilience during hurricane season is a real non-financial benefit. Our Battery Storage Calculator shows the financial payback on a Powerwall in your specific rate environment.
Bottom Line
South Carolina is a quietly strong solar market in 2026. The 25% state credit (up to $3,500, 10-year carryforward), full retail net metering from Dominion Energy SC, and solid 5.0 peak sun hours combine to support 8–11 year payback for most homeowners in the Dominion service area. Duke Energy customers in the western upstate face the same avoided-cost export challenge as North Carolina — different utility, harder math. Know your utility, apply the state credit correctly, and the numbers are competitive for a Southeast state.
Related Guides
- Solar Panel Cost by State in 2026 — See how South Carolina compares to every other state for costs and incentives.
- Is Solar Worth It in 2026? — National payback analysis to put South Carolina’s numbers in context.
- Net Metering Guide 2026 — How South Carolina’s net metering compares to neighboring Southeast states.
- Home Solar Panels: The Complete 2026 Guide — Everything you need to know before getting your first solar quote.
