South Carolina Solar Incentives in 2026: What Is Actually Left
South Carolina still gives a 25 percent state solar tax credit in 2026. It goes only to homeowners who buy and own their system. The credit is capped at $3,500 a year, and any unused part rolls forward for up to 10 years. The federal 30 percent credit ended for any system placed in service after 2025. A leased system cannot claim the state credit, but it still touches federal credit value through the leasing company.
Nature's Nergy sells both paths, leasing and financing, so this guide has no reason to steer you toward one. Here is what is actually left in South Carolina in 2026, and who each incentive really reaches. For the full financial side-by-side, see the lease vs buy breakdown.
| Incentive | What it is worth | Who can claim it |
|---|---|---|
| SC state solar tax credit | 25% of cost, capped at $3,500/yr or 50% of tax liability, whichever is less; unused credit carries forward up to 10 years (SC Code 12-6-3587, form TC-38) | Homeowners who buy and own the system |
| Federal credit for owned systems installed after 2025 | $0 | No one; Section 25D ended (IRS) |
| Federal credit on leased or PPA systems | Claimed by the leasing company (Section 48E); some providers pass part of the value through as a lower rate | The leasing company, not the homeowner directly |
| Typical SC home solar purchase, installed | $32,002 to $43,298 before incentives (EnergySage, 2026) | Market range, not a quote |
See what a real system costs for your own roof. Get your free solar quote and Nature's Nergy will walk you through which incentives actually apply to your situation.
What solar incentives does South Carolina actually offer in 2026?
Two things are left standing in 2026: the state tax credit, and utility net metering. The old federal homeowner credit is not one of them anymore. That is the single biggest source of confusion right now, because a lot of "30 percent off" advice online is still written for the old rules.
The state credit rewards ownership. Net metering rewards production, and it works the same way whether you own or lease. Knowing which incentive reaches which homeowner is the whole point of this guide.
How does the South Carolina 25 percent solar tax credit work?
South Carolina gives homeowners a state tax credit. It is worth 25 percent of what you pay to buy and install a solar system. The law lives at SC Code Section 12-6-3587. You claim it on South Carolina Department of Revenue form TC-38.
The credit has a yearly cap. You get whichever is smaller: $3,500, or half of your state tax bill that year. If your credit is bigger than what you owe, you do not lose it. South Carolina lets you carry the rest forward for up to 10 years. A typical system's credit can spread across several tax returns instead of landing all at once.
This credit only reaches homeowners who buy and own their system, through cash or solar financing. A homeowner who leases never files for it. The credit belongs to whoever owns the equipment. In a lease, that is the solar company, not you.
What happened to the federal solar tax credit?
It ended for owned systems. The federal Section 25D Residential Clean Energy Credit gave homeowners 30 percent back on systems installed between 2022 and 2025. Per the IRS, that credit is gone for any property placed in service after December 31, 2025.
That is a real shift from the old advice. Buying used to come with a federal credit on top of South Carolina's own 25 percent. In 2026, buying only carries the state credit. The federal piece is gone for anyone who owns their system going forward.
Can you still get any federal credit value if you lease instead of buy?
Yes, and this is the part most homeowners miss. Third party owned solar means a lease or a power purchase agreement. Those projects can still qualify for a related federal credit under Section 48E. The leasing company must start construction before July 2026, or place the system in service by the end of 2027.
The homeowner never files for that credit. The leasing company does, because it owns the equipment. Per EnergySage, competitive providers typically pass some of that value through as a lower monthly rate. Ask any provider directly whether and how it shows up in your number. Nature's Nergy's solar leasing program is one path where that federal value can still reach your rate, even though it never touches your tax return.
Does net metering still pay you for extra solar power in South Carolina?
Yes, and it is separate from both tax credits. South Carolina's two big utilities, Duke Energy and Dominion Energy, both run a net metering or Solar Choice program. It credits a solar homeowner for the extra power their system sends back to the grid. State law, the Energy Freedom Act, required regulators to set up this solar choice structure. Both utilities have been adjusting their credit and rate options through 2025 and into 2026.
Net metering ties to your utility account, not your tax return. It works the same way whether you own or lease. It does not change the buy versus lease math from the last two sections. It just means your monthly bill benefits from solar either way, on top of whichever tax credit path applies to you.
So is it still worth going solar in South Carolina in 2026?
For most homeowners, yes. But which incentive you can use depends on how you pay for the system. If you buy or finance, you can claim South Carolina's 25 percent state credit, worth up to $3,500 a year with years to carry it forward. If you lease, you skip that state credit. But a competitive lease can still carry federal credit value baked into the rate, and you avoid the five figure purchase entirely.
As of 2026, a typical South Carolina home solar purchase runs $32,002 to $43,298 installed before incentives, per EnergySage. That is a market range, not a Nature's Nergy quote. Your real number depends on your roof, your usage, and your equipment.
Nature's Nergy is a family owned, licensed and insured residential solar company. It serves the Columbia SC area from the St Andrews corridor. Owner Michael "MG" Guilbert brings 10 years of solar experience to every home. Every install, leased or financed, is backed by a 25 year labor and parts warranty. See every home solar option Nature's Nergy offers, then request your free solar quote or call (803) 728-1211 to find out which incentives actually apply to your home.
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Related questions
What incentives are available for solar in South Carolina?
The main one left in 2026 is South Carolina's own 25 percent state solar tax credit, worth up to $3,500 a year, for homeowners who buy and own their system. Utility net metering programs from Duke Energy and Dominion Energy also credit solar homeowners for extra power sent back to the grid, whether the system is owned or leased. The old federal homeowner credit is gone.
Is South Carolina getting rid of the solar tax credit?
No. The South Carolina state credit at SC Code Section 12-6-3587 is still active in 2026. What ended is the separate FEDERAL homeowner credit, which stopped for any system placed in service after December 31, 2025. The two credits are not the same program.
What is the 30 percent tax credit for solar panels, and is it gone?
That was the federal Section 25D Residential Clean Energy Credit, and yes, it is gone for homeowners who buy or finance a system installed in 2026 or later. Per the IRS, the credit is not available for any property placed in service after December 31, 2025. Leased and PPA systems still reach a related federal credit through the company that owns the equipment.