State analysis · source documents checked 2026-09-24

Solar payback in South Carolina (SC) — 2026

South Carolina's credit is constrained by annual tax liability, so a nominal 25% credit may take several returns to use.

What decides the answer in South Carolina

Section 12-6-3587 of the South Carolina Code allows an income tax credit of 25% of the cost of purchasing and installing a solar energy system on a South Carolina facility the taxpayer owns. It cannot be claimed before installation is complete. The annual use limit is the lesser of 3,500 dollars per facility and half the taxpayer's liability for that year; excess may carry forward for up to ten years. The Department of Revenue's Schedule TC-38 implements those limits and says a solar interconnection agreement between a utility and the taxpayer counts as the required certification. The nominal credit is not an installation-day rebate. [1] [2]

Two details decide how much of the credit a household can use. Section (B) excludes land and structural elements of the building such as walls and roofs from the system, so roof work bundled into a quote may not count toward the 25%. And because each year's use is capped at half of that year's South Carolina income tax liability, using 2,000 dollars in one year needs at least 4,000 dollars of liability, and using the full 3,500 dollars needs at least 7,000. [1] [2]

The reproducible scenarios assume qualified cost equals the displayed installed cost, so the modeled credit totals 5,600 dollars. One case assumes 2,000 dollars usable per return, with only the remaining balance in the last year. A slower case permits 500 dollars a year for the initial year plus ten carryforward years and leaves the unusable 100 dollars out of modeled cash. Both are assumed tax situations, not customer cases or tax advice. Against the otherwise identical no-incentive row, the credit shortens modeled payback from about 17.5 years to about 13.7 years at 2,000 dollars per return; the fastest pace the statute allows (3,500 dollars, then 2,100) also gives about 13.7 years. Spreading the credit over eleven returns instead of three moves payback by less than a tenth of a year, to about 13.8 years. That small gap partly reflects the model, which does not discount future dollars, so it understates what a slow schedule costs a household that values money sooner. [1] [2]

Export terms are a separate question with their own statute. Section 58-40-20(B) requires net metering under Commission Order No. 2015-194 for customer-generators who applied before June 1, 2021; those who applied after the 2019 act took effect (May 16, 2019, per the section's history note) and before June 1, 2021 may continue it until May 31, 2029. The section sets no end date for earlier applicants, and none is given here. Under (F)(1), applications received after May 31, 2021 fall under a solar choice metering tariff established by the Public Service Commission, so a household applying today to a utility covered by Chapter 40 is on that utility's commission-approved tariff, not a retail supply contract. Chapter 40 exempts utilities serving fewer than 100,000 customer accounts, and the Section 58-27-10 definition it uses does not include electric cooperatives. This page has not established cooperative, municipal or Santee Cooper terms. [3] [4]

This check did not verify a current Duke Energy or Dominion Energy solar choice rate, netting interval or minimum bill, so the 5-cent export price in the household rows is plainly assumed, as is the 15-cent import price. The import figure is a round assumption above the 14.23-cent EIA 2024 statewide average, not a named rate schedule; at 14.23 cents the no-incentive, 2,000-dollar and 500-dollar cases give about 18.0, 14.2 and 14.3 years, so the credit's effect barely changes. Ask for the actual tariff, netting interval and minimum-bill rules, and test both the credit schedule and a lower export value rather than assuming their effects cancel. [3]

How South Carolina pays for an exported kilowatt-hour

Utility tariff or retail-provider contract. In South Carolina, for a utility covered by Chapter 40, it is a utility tariff: for applications received after May 31, 2021, a solar choice metering tariff established by the Public Service Commission under Section 58-40-20(F)(1). A sourced tax-credit formula does not supply a sourced export rate. The household rows isolate those two variables and retain an otherwise identical no-incentive case.

No federal residential credit is applied by default in any calculator or state benchmark on this site (Section 25D expired at the end of 2025), and the mechanics of export regimes are covered in the net metering guide.

Sources for the South Carolina section above

South Carolina Code 12-6-3587 — Credit calculation, completion, annual limits, ten-year carryforward and the structural-element exclusion.
Document: Title 12, Chapter 6, Section 12-6-3587(A) and (B). Effective/source period: Re-enacted by 2019 Act No. 47, effective May 16, 2019, for tax years beginning after 2018.
Applies to: Taxpayer-owned qualifying South Carolina facility; certification conditions apply. Relevant passage: “twenty-five percent of the costs”.
South Carolina DOR TC-38 — Tax-liability cap, carryforward worksheet and interconnection agreement as certification.
Document: Schedule TC-38 (Rev. 3/28/22), credit computation, certification and instructions. Effective/source period: Form revision 3/28/22; confirm the filing-year version.
Applies to: Eligible individuals/corporations claiming the credit. Relevant passage: “Unused credits may be carried forward for up to 10 years.”.
South Carolina Code 58-40-20 — Legacy net-metering cutoff, the May 31, 2029 end date for applicants after May 16, 2019 and before June 1, 2021, and the commission-set solar choice metering tariff for later applications.
Document: Title 58, Chapter 40, Sections 58-40-20(B), (F)(1) and 58-40-10(D). Effective/source period: Section rewritten by 2019 Act No. 62, effective May 16, 2019.
Applies to: Customer-generators of electrical utilities covered by Chapter 40; utilities under 100,000 customer accounts exempt. Relevant passage: “may continue net energy metering service as provided for in Commission Order No. 2015-194 until May 31, 2029”.
South Carolina Code 58-27-10 — Electric cooperatives fall outside the definition Chapter 40 uses.
Document: Title 58, Chapter 27, Section 58-27-10(7), definition of electrical utility. Effective/source period: Codified text retrieved September 24, 2026; no new effective date asserted.
Applies to: Defines which utilities Chapter 40 covers. Relevant passage: “shall not include an electric cooperative”.

“Source documents checked 2026-09-24” means each linked document was retrieved on that date and the passage quoted under it is the text the claims in this section rely on. The date covers only those claims. It is not a household eligibility decision or a guarantee that a tariff is still current, so check the linked live documents before signing a contract, and report corrections via the contact page.

Common retail-value benchmark — not a household forecast

No incentives; every modeled kWh is valued at the historical state-average retail price. The household scenarios below separate assumed import/export prices, consumption share, cash cost and receipt timing.

How South Carolina compares with the other 50 records in this dataset
Measure	South Carolina	Dataset median	Rank of 51
Avg residential rate	14.23¢/kWh	14.91¢/kWh	30th highest
NSRDB daily sunlight (one location per state)	5.2 kWh/m²/day	4.9 kWh/m²/day	17th highest
Retail benchmark payback	13.0 years	13.0 years	27th fastest on this benchmark
Household scenarios below (range)	13.7 years to 20.2 years	—	Not ranked across states

The rank compares every state on the same full-retail basis; it is a benchmark, not a forecast for a new South Carolina customer. The household scenarios below, each with its own stated import price, export credit, cost and incentive timing, give 13.7 years to 20.2 years.

Rate: Calendar year 2024 annual average, from the EIA. Sunlight is NSRDB data via NLR PVWatts v8 at each state's 2020 Census center of population, one location per state (request settings and the values PVWatts returned are in state-insolation-pvwatts.json). Ranks and medians are computed across the 50 states and DC in this dataset. Every input behind the payback figure is printed in the assumptions block below, and the full 51-row table is at /states.

Reproduce the South Carolina household comparisons

These are hypothetical households, not customer results or offers. All start from an assumed 7 kW array producing 10402.94 kWh in year one; any row that changes production (a battery or a production-stress row) says so. The sunlight input is NSRDB data via PVWatts v8 for one location per state (request and response in state-insolation-pvwatts.json; see the methodology), not a production estimate for your roof. No federal credit is applied. No loan, income-tax effect on incentive revenue, battery replacement or future tariff change is modeled.

The benchmark row prices every kWh at the EIA average cited above. Where another row applies a published figure (for example a tariff or rider rate or charge, a program incentive rate, a statutory fee schedule, or a tax credit's rate, cap or carryforward period), that figure comes from a document in the sources list above. Every other price, consumption share, cost, fee, receipt date and amount of tax a household can use in a year is assumed. Eligibility remains conditional. The annual split does not reproduce monthly netting, time-of-use periods, credit caps, curtailment or minimum bills. Annual fees represent incremental solar costs, not charges you would pay with or without solar.

Production degrades by assumed 0.5% per year. The main result increases both import and export prices by assumed 3% per year; the flat-price column sets that to zero. Neither escalation is a tariff forecast. Fixed fees and scheduled receipts do not escalate. Energy savings accrue uniformly within a year for interpolation; incentives arrive only at year end.

Download exact scenario inputs and all 25 yearly results (JSON)

Modeled results, not guarantees. No break-even means no crossing inside 25 years, not a calculated date beyond year 25.
Scenario	Initial cash cost	Year 1 energy value	Year 1 net cash incl. receipts	Payback	Flat-price payback	25-year net cash after cost
Common retail-value benchmark — no incentives	$22,400.00	$1,480.34	$1,480.34	13.0 years	15.7 years	Modeled $28,066.92
Hypothetical household — no incentives	$22,400.00	$1,040.29	$1,040.29	17.5 years	22.7 years	Modeled $13,065.16
Illustrative higher cash price — no incentives	$26,880.00	$1,040.29	$1,040.29	20.2 years	no break-even inside 25 years	Modeled $8,585.16
Illustrative 75% self-use — no incentives	$22,400.00	$1,300.37	$1,300.37	14.5 years	18.0 years	Modeled $21,931.44
Conditional tax use: 2000 dollars per return	$22,400.00	$1,040.29	$3,040.29	13.7 years	16.8 years	Modeled $18,665.16
Conditional tax use: 500 dollars per return	$22,400.00	$1,040.29	$1,540.29	13.8 years	16.9 years	Modeled $18,565.16

Inputs, receipts and annual arithmetic: Common retail-value benchmark — no incentives

Historical state-average import value for ALL production; only a comparison, not an address-specific tariff.

Assumed initial cash cost $22,400.00, not reduced by any upfront credit or rebate; any receipt is listed below and arrives at year end. Import 14.230¢/kWh; export 14.230¢/kWh; self-use 100%; incremental fixed annual cost $0.00.

Year-one modeled energy value = 10402.94 × [(100/100 × 14.23/100) + ((1 − 100/100) × 14.23/100)] = $1,480.34. Subtract the annual fixed cost and add only that year's receipts for net cash. Display rounds cents; the downloadable calculation retains full precision.

Incentive basis: None; no eligibility or benefit assumed. Modeled total receipts inside 25 years: $0.00. These are not subtracted from initial cash cost.