Are Sun-Powered Setups Feasible in the Volunteer State?

f you were asked to imagine the ideal place for solar energy, Tennessee—with its reputation for rainfall and reasonable electricity costs—may not be the first location to spring to mind. Still, before dismissing the idea entirely, let's zoom in and carefully evaluate this assumption. Could it be possible that we're missing something in the bigger picture? This article aims to explore the hidden potential of photovoltaic energy in the state.

Delving into Tennessean Solar Sketicism: Viability in Question

The Volunteer State, blessed with an abundance of natural resources, has a complex relationship with renewable energy. On the one hand, the state's rich hydroelectric and nuclear resources have historically overshadowed the need for solar. On the other hand, contrary to its reputation for rain, it actually enjoys a considerable amount of sunshine throughout the year, with an average of 207 sunny days annually, surpassing the national average of 205 days. But does that make solar power a viable option in this state?

Traditionally, some critics have argued that the cost of solar panels in Tennessee may not be worth the return on investment. In 2023, the typical cost of residential electricity in the state is 12.43 cents per kilowatt hour, which is 18.98% lower than the average national rate of 15.34 cents. The lower electricity rates can make the economics of solar power less appealing, as the savings from it are typically more pronounced in areas with higher utility rates.

However, consider this: Tennesseans still pay around $152.41 per month for electricity, adding up to over $1,800 annually. By harnessing the sun’s energy, once you recover your initial investment, you'll relish in the freedom of clean, cost-free power. Plus, considering the 25-30 year lifespan of solar systems, the accumulated savings will be quite significant.

Furthermore, the proportion of PV investment to long-term gains keeps getting better as electricity rates steadily rise while solar costs steadily decline. Specifically in the Volunteer State, the cost of solar has undergone a remarkable transformation, with PV panel expenses plunging by more than 53% over the past decade.

Investing in a PV System: Expenses and Time to Recoup

A key factor that often comes into play when considering solar power is the cost of installation. Photovoltaic panels aren't cheap, and the initial investment can be a significant hurdle for many homeowners. The average price for installing solar panels in Tennessee stands at $3.12 per watt as of May 2023. For a standard 6-kilowatt system, the total cost typically ranges from $15,900 to $21,500 without taking into account any incentives.

The time it takes to recoup the initial costs can vary greatly, depending on factors such as energy consumption and PV panel efficiency. On average, it can take anywhere between 9 and 14 years for a TN homeowner to break even on their investment. That might seem like a long time, but it's important to remember that solar modules continue to generate electricity – and savings – long after they've paid for themselves.

Solar Incentives in the Volunteer State

Tennesseans are in luck, as there are a number of solar incentives and programs waiting for them at both the federal and state levels. These incentives are designed to make solar energy systems more wallet-friendly, opening the doors for homeowners and businesses to embrace sustainable and affordable power options. So, without further ado, let's uncover the top-notch incentives available for Tennessee residents.

Federal ITC: The Federal Solar Investment Tax Credit (ITC) is a nationwide incentive that allows homeowners and businesses to claim a tax credit for a portion of their solar energy system costs. As of 2023, the ITC is set at 30% for residential installations. Following the year 2032, the residential Investment Tax Credit (ITC) will gradually decrease to 26% in 2033, further reducing to 22% in 2034 and ultimately concluding in 2035. Hence, it's essential to act quickly if you want to take advantage of this credit.

To qualify for the ITC, you must own your solar energy system, and it must be installed on your property. If you meet these requirements, you can claim the ITC on your federal income tax return. Remember that you'll need to have enough tax liability to claim the entire credit in one year; otherwise, you can roll over the remaining credit to future years.

Property tax exemption: The Green Energy Property Tax Assessment is a program that encourages the adoption of renewable energy by offering property tax breaks to homeowners who install solar systems. Under this program, the added value of the PV system to your property is exempt from property tax assessment. This means that you won't have to pay extra property taxes for the increased value of your home due to solar installation. It's important to note that this tax break is applicable only to the property tax and not sales tax.

Net Metering: As of now, there is no net metering option or established grid interconnection rules in the state. However, if you take part in the Green Power Providers program offered by the Tennessee Valley Authority (TVA), you can benefit from dual metering. TVA serves most areas in the state, and you might meet the requirements for their Dispersed Power Production Program, which includes a dual-metering plan.

Premier Local Installers: The Best in the Business

TN residents have an abundance of choices, with over 60 installation companies available to cater to their solar energy needs. Each of these installers brings something distinct to the table, whether it's the quality of their systems, comprehensive warranty coverage, or cutting-edge equipment. Navigating through these options to find the ideal one can be quite a thrilling task. Here are a few standout companies you should have on your radar.

Green Tech Renewable Energy (GTRE): a local leader in renewable energy solutions based in Johnson, TN, leverages over ten years of experience to meet your distinct energy needs. They offer an extensive portfolio of over ten premium solar panel brands, including LG and Panasonic, with many boasting an impressive efficiency rating of over 20%. While their payment methods are limited to cash and solar loans, GTRE's competitive pricing model makes solar power more accessible, addressing the state's high energy demands without breaking the bank.

LightWave Solar: a Nashville-based company that offers an impressive range of leading solar brands, such as REC, SunPower, and Tesla, all known for above-average efficiency. The company prides itself on its highly experienced, NABCEP-certified installers who've been honing their skills locally for over 15 years. Despite the limitation of only accepting cash payments and solar loans, their excellent customer service and specialist expertise make the upfront cost a worthy investment.

Shine Solar: As a premier player in the local market, Shine Solar has gained acclaim for its affordable pricing, ensuring solar power remains within reach in a state where costs typically exceed the national average. Their warranty coverage, featuring an industry-standard 25-year equipment warranty and an exceptional 12-year labor warranty, provides customers with an extra layer of security. While they exclusively offer Silfab panels, their high efficiency and competitive pricing make them a practical choice for the state's high energy demands.

‍In Conclusion: Are Solar Panels in Tennessee Worth Investing in?

To sum up, despite initial skepticism, solar panels are indeed worth investing in for Tennesseans. With 207 sunny days annually, declining solar costs, and a range of federal and state incentives, long-term savings can be quite significant. The key is to carefully evaluate your energy needs, choose the right installer, and take advantage of available incentives to maximize your return on investment.

Sources:

https://findenergy.com/tn/

https://www.seia.org/state-solar-policy/tennessee-solar

https://www.energysage.com/local-data/solar-panel-cost/tn/