SC senate plan would stop solar tax credits for homeowners

sfretwell@thestate.comFebruary 4, 2014 

Land owners and farmers in rural eastern North Carolina are leasing out their land to companies who are installing solar farms to sell energy to the utility grid. Here, a worker installs the solar panels in the solar farm in St. Paul, NC.

FILE PHOTOGRAPH — The State Buy Photo

— South Carolina’s skepticism about solar power emerged again Tuesday, when lawmakers agreed to phase out solar tax credits for homeowners at the same time utility regulators were offering little support for a large solar farm in the Upstate.

The Senate Finance Committee voted to drop the residential tax credit after 2017 as part of a bill intended to help businesses that want to use sun panels to save money. Under current South Carolina law, homeowners can claim a 25 percent tax credit off the cost of installing solar panels.

Senators said little about why they wanted to phase out the tax credit for homeowners, but Sen. William O’Dell, R-Abbeville, said a similar federal tax credit is to expire in the next three years.

Republican Sen. Wes Hayes, of York, and Columbia-area Democrats Nikki Setzler, Darrell Jackson and Joel Lourie questioned why South Carolina can’t have its own solar tax credit for homeowners, regardless of what the federal government does.

“What difference does that make?’’ Hayes asked.

South Carolina historically has been one of the least friendly states in the country toward solar power, despite plenty of sunshine. Utilities, which have monopolies on power sales and distribution, have been reluctant to embrace the sun’s energy as a major source of electricity.

Some recent developments, such as the solar tax credit bill, have offered hope to environmentalists and solar energy boosters that say making electricity from the sun can save people money while reducing pollution or waste associated with coal and nuclear power.

The Senate did vote to expand solar tax credits for businesses Tuesday, but agreed to end the business tax credit after 2017. The expanded tax credit plan also was tempered by objections that could doom the bill in the Legislature.

Sen. Kevin Bryant, R-Anderson, placed an objection on the bill after saying he couldn’t justify expanding solar tax credits when certain school tax credit bills have not passed the Legislature. The objection puts the bill toward the back of the Senate’s calendar, meaning other legislation would take priority throughout the legislative session.

Bryant, one of the most conservative members of the Senate, is a champion of programs that help private schools.

“We’ve seen all these tax credits for everything under the sun – except for education,’’ Bryant said.

PSC mum on solar farm proposal

Meanwhile, the state Public Service Commission, which was expected to grill solar boosters at a hearing Tuesday, had little to say about a proposal that could lead to one of the country’s largest solar farms in a rural corner of the Upstate near Anderson.

The Southern Alliance for Clean Energy and the S.C. Coastal Conservation League want Duke Energy to study developing 375 megawatts of solar power to complement a new natural gas plant it plans along the Saluda River. That could be done by one large farm, or several smaller ones.

Solar power advocates told the PSC that the sun generating station would reduce the need to buy natural gas for the plant, thus saving ratepayers money, since solar costs almost nothing to produce.

But Duke said it shouldn’t be required to develop the solar farm because the natural gas plant will be more than adequate. The PSC is expected to rule this spring on whether to require studies of a solar farm at the natural gas site, where Duke is phasing out a coal-fired power station.

“Solar energy at this point is not a cost effective alternative for additional resources, such as the project we are proposing,’’ said Janice Hager, a Duke Energy vice president, at Tuesday’s PSC hearing.

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