Although South Carolina does offer some seemingly good incentives on paper, not enough renewable producers are able to fully take advantage of the few available incentives that can make or break green industry, primarily due to the lack of standards and legitimate regulation.
Utilizing the federal tax credits for solar and small scale hydropower installations is the leading way environmentally conscious power consumers are making good on their green investment. Also, buying into the non-profit Palmetto Clean Energy (PaCE) program is giving renewable producers a reason to rejoice, but consequently is taking away from the South Carolina Public Service Commission’s (PSC) mandated net-metering program, because of the vagueness of realistic incentives and benefits that investor owned utilities (IOU) are required to offer.
Without any kind of Renewable Energy Standard (RES) South Carolina has left themselves at a disadvantage to make their claim in the green revolution taking place across the nation. As compared to neighboring states, and the example of the nation’s leader in renewable industry, California, a RES may at first be controversial, but after a few years could be South Carolina’s golden ticket to a championship caliber green economy and busy local solar installers.
Program Type: Personal Tax Credit
Technologies: Solar Water Heat, Solar Space Heat, Photovoltaics, Solar Cooling, Daylighting, Small Hydroelectric
Amount: 25% of eligible costs, maximum incentive in any given tax year of $3,500, or 50% of taxpayer’s
tax liability for that taxable year, whichever is less
Required Documentation: The installation date(s), proof of your costs for the installation of solar and/or small hydro-electric systems
Official Web Site: http://www.energy.sc.gov/index.aspx?m=1&t=5&h=19
South Carolina offers its taxpayers a credit of 25 percent of eligible costs with a maximum of $3,500, or 50 percent of their tax liability, or whichever is less on their annual taxes for installing a renewable solar or small hydro-electric system.
This credit became a reality to both solar and hydro-electric systems with the passing of Senate Bill 1141 in July of 2009 as its predecessor only applied to solar installations. Credits that exceed the annual cap of $3,500, or go unused, can be carried forward for 10 years.
As defined by the bill, a “system” includes “all controls, tanks, pumps, heat exchangers, and other equipment used directly and exclusively for the solar-energy system,” but does not include “any land or structural elements of the building, such as walls and roofs, or other equipment ordinarily contained in the structure.”
This valuable credit not only applies to the materials required to build qualifying renewable systems, but also covers labor costs incurred on or after Jan. 1, 2006.
It is up to the owner and/or operator of this system to get the installation certified by the Solar Rating and Certification Corporation (SRCC) or a comparable entity endorsed by the South Carolina Energy Office to qualify for the credit.
Palmetto Clean Energy (PaCE) Program
Program Type: Performance-based Incentive
Technologies: Photovoltaics, Landfill Gas, Wind, Biomass, Geothermal Electric, Municipal Solid Waste,
Anaerobic Digestion, Small Hydroelectric, Biodiesel
Amount: Varies by technology and customer demand for Palmetto Clean Energy
Required Documentation: Certification by Solar Rating and Certification Corporation (SRCC) or comparable entity
endorsed by the South Carolina Energy Office
Official Web Site: http://www.palmettocleanenergy.org/
The Palmetto Clean Energy (PaCE) program was created to encourage renewable energy consumption by offering credits, and in the event of an excess of what renewable owners use, the ability to sell the energy back to the grid at a competitive rate. Also, the PaCE program allows for non-renewable owners to purchase the green energy at a slightly higher rate to support the non-profit program and the environmentally conscious effort.
Originally started in 2007—and launched in April 2008 through a collaborative effort among Duke Energy, Progress Energy, South Carolina Electric & Gas Company, the South Carolina Energy Office and the South Carolina Office of Regulatory Staff—the PaCE program is supported solely by volunteers who wish to contribute their renewable energy to North Caroline via grid-tied solar, wind, biomass, geothermal and small-scale hydropower systems.
Modeled after a similar program in neighboring North Carolina, NC GreenPower, PaCE is subject to approvals of renewable generator applications by means of premium payments and sufficient funding for power output. Compensation is based on a system that uses “blocks” of energy where one block is equivalent to $4, and supports approximately 100 kWh of renewable energy generation. Of this $4, $3 goes to the generators and $1 goes to PaCE for its services.
SCE&G Net Metering
Program Type: Net Metering
Technologies: Photovoltaics, Wind, Biomass, Hydroelectric, Small Hydroelectric
Amount: Customer net excess generation (NEG) is credited to the customer’s next bill at the utility’s retail rate
Required Documentation: Certification by Solar Rating and Certification Corporation (SRCC) or comparable entity endorsed by the South Carolina Energy Office
Official Web Site: http://www.sceg.com/en/small-business/net-metering
In July of 2008 the South Carolina Public Service Commission (PSC) put into effect a directive that all investor owned utilities offer a net-metering service to their renewable customers. This was a very vague directive that hasn’t really been completely hashed out.
Essentially, the net-metering program in South Carolina credits the renewable energy producer at the same rate the utility charges for service. The excess energy that is not used by the producer is then pushed back into the energy grid at the same rate. The excess is then tallied, and the kilowatt hours (kWh) that are contributed are reimbursed to the producer at the end of the year, which in the case of South Carolina is June 1st. Only grid-tied systems are applicable to the net-metering program.
There are two options to producers who wish to participate in the net-metering program. The first requires producers to switch to a time-of-use (TOU) tariff that can incorporate high demand charges into its fee structure. The second requires producers to pay an additional monthly fee to net-meter. Unfortunately, these two options are the result of the vagueness of the net-metering directive handed down by the South Carolina PSC.
South Carolina Solar Power Financial Incentives
Corporate Tax Credit – Solar Energy Tax Credit (Corporate)
State Loan Program – ConserFund Loan Program
South Carolina offers a few incentives for increasing the use of solar power in the state. The most cost-reducing of these is rebates. South Carolina does not offer rebates, but the local utility company does. Additional incentives are available through the federal government.
Summary of South Carolina Incentive Programs
•Federal Tax Credit 30%
•State Tax Credit 25%
•Available production tax credits
South Carolina Rebate
Progress Energy Carolinas offers the sole rebate program in the state, $1000 for the installation of a solar water heater.
South Carolina Tax Credits
The state has a tax credit program in the amount of 25% for both businesses and individuals. The maximum credit is $3,500 or 50% of the tax liability for the year, whichever is less.
Additionally, solar production equipment is sales tax exempt. Production tax credits are available from Palmetto Clean Energy (PaCE) Program in varying amounts.
The state loan program, named ConserFund provides loans from $25,000 to $500,000. Also, there is a zero interest lending program for customers who participate in the utilities net billing program. The federal government provides more lending options.