South Dakota Solar Panel Buyers Guide [Installation & Efficiency 2022]
Here’s what we’ll cover in this guide to South Dakota solar panels:
- The average cost of solar equipment in SD
- How sunlight availability in SD affects solar energy production
- What South Dakota solar incentive programs are available to help you save on installation costs
How to Get Solar Panels in South Dakota
The process of getting solar installed in SD begins when you connect with an installer to get a quote. A representative from the company will review your energy bills, assess your property and help you find a financing option that works for you. Depending on the installer, you can choose from cash purchase, solar loan, solar lease, or power purchase agreement (PPA).
Once you make payment, your installer will obtain permits from your local building department and then begin the installation process. Finally, your system will be commissioned, and final inspections will be set up to close out your permits.
Converting to solar turns out to be a great decision for most South Dakota homeowners. Going solar will, of course, contribute to the clean energy movement and reduce your carbon footprint. However, it also saves you money on energy bills — usually around $23,000 over the lifespan of your photovoltaic (PV) equipment.
GenPro Energy Solutions
Lakota Solar Enterprises
Black Hills Solar
What Is the Price of Solar Panel Installation in South Dakota?
The price of installing a solar energy system will differ for every customer, as cost fluctuates based on several factors. The average per-watt cost in SD is $2.39, which is cheaper than in nearly every other state. After the Residential Clean Energy Credit (formerly known as the investment tax credit or ITC) is applied, the typical 10.5 kilowatts (kW) system required in SD totals around $17,500.
A good measure of how valuable panels will be in your area is called the panel payback period. This tells you how long it will take for your panels to pay themselves off by taking electricity rates, equipment costs, and average energy needs into consideration.
The average payback period is 11 years in SD, which is shorter than the national average, so solar is a bit more valuable in Mount Rushmore State than in most others.
You can get more information on the local cost of solar panels by reading our solar pricing guidelines for South Dakotans.
The Best Solar Panel Brands Available in South Dakota
The Solar Energy Industries Association (SEIA) notes that SD has had one of the slowest adoption rates for solar energy in the country.1 However, residents still have access to most major panel brands.
The panels chosen are typically either optimized for efficiency — in low-sun areas — or durability — in areas with extreme weather. Since SD is in Tornado Alley and sees dozens of potentially damaging tornadoes each year, most residents opt for panels with lengthy warranty coverage.2 Some popular options in the area include:
- SunPower (now manufactured by its sister company, Maxeon)
- Canadian Solar
Is South Dakota a Good State for Solar Panels?
While the rate of solar adoption in the area is much slower than in most other states, SD is still considered a good place to go solar. Below are a few factors that make solar a valuable investment in SD.
- Plenty of sunlight: Photovoltaic panels only produce energy and save you money on your electric bills when the sun is shining. For that reason, areas that see abundant sunlight also see greater value from solar equipment. South Dakotans experience an average of 213 sunny days per year.3 This is above the national average, making SD a better place to convert to clean energy than many other states.
- Below-average equipment costs: As mentioned above, SD residents pay an average of $2.39 per watt for solar equipment. The national average is significantly higher at $2.66. Since homes in the area usually require a 10.5 kW solar PV system, the low equipment costs translate to up-front savings of approximately $2,835. Of course, lower installation costs mean you get more value for your money when converting, and it also means you can pay off your system more quickly and begin enjoying energy savings.
- Above-average energy needs: The typical household in SD consumes around 1,037 kilowatt-hours (kWh) of electricity per month. This is nearly 20% higher than the national average of 893 kWh each month. When energy needs are high, utility bills are also bound to be high. In areas like SD, where electric bills are above average, panels provide more opportunities to save money. Ultimately, this translates to solar being more valuable in the area overall.
How Much Energy Can I Get From Solar Panels in South Dakota?
Most solar customers want to know how much electricity solar power systems on their roofs will produce before beginning the conversion process. An accurate production estimate will give you an idea of the system size you need, which allows you to estimate costs before ever speaking with an installer.
Unfortunately, coming up with an accurate estimate is challenging because there are many things that can affect your generation rate. Below are some of the most important factors your solar provider will take into consideration.
- The direction your roof faces: PV panels angled toward the sun in the sky will always generate more energy than those that sit at a tangential angle. In the U.S., south-facing roofs are the best fit for panels because they tilt toward the sun and receive the most direct sunlight. Roofs that face east and west can also have good solar viability, but those that point south will lead to higher rates of energy production.
- Impediments to sunlight on your roof: Along with the intensity of the sunlight hitting your roof, the amount of sun that reaches your panels is a crucial factor. More sunlight means more energy generation, which means greater energy savings. Obstacles that impede sunlight and shade your roof — including larger obstructions like trees and other homes and smaller ones like utility poles — will cause your energy generation rates to drop.
- The size of your solar array: Each panel you install as a part of your rooftop solar system will include additional solar cells that can generate electricity for your home. That means systems with more panels will naturally have greater rates of production. However, it’s more cost-effective to size your system to meet your energy needs rather than exceed them in most cases. This is why consulting a reputable solar installer is the best course of action for determining how many panels you need.
- The efficiency of the panels you install: When sizing your system, your solar company should also consider the brand of panels you choose and the efficiency rating. This number — expressed as a percentage — tells you how much of the sunlight that hits your panels can actually be used to generate electricity. Higher efficiency ratings mean each panel will generate more power, which means fewer panels overall might be required.
- The weather: Finally, local weather conditions can play a role in day-to-day production, and it will cause fluctuations through the seasons. In SD, you will likely see the highest level of energy generation on bright, sunny days in the summer. Production tends to dip into the winter, and cloudy days can cause a drop in efficiency of up to 90%.
These factors make broad production estimates unreliable in many cases. Still, you can use the chart below to get a rough idea of how much electricity different system sizes in SD might generate for your home.
|Solar System Size||Expected Daily Energy Produced||Expected Monthly Energy Produced||Expected Annual Energy Produced|
|8 kW||26.6 kWh||800 kWh||9,600 kWh|
|9 kW||30 kWh||900 kWh||10,800 kWh|
|10 kW||33.3 kWh||1,000 kWh||12,000 kWh|
|11 kW||36.6 kWh||1,100 kWh||13,200 kWh|
|12 kW||40 kWh||1,200 kWh||14,400 kWh|
|13 kW||43.3 kWh||1,300 kWh||15,600 kWh|
|14 kW||46.6 kWh||1,400 kWh||16,800 kWh|
You can also use our solar calculator for a more accurate estimate. This tool considers shading on your property and average local conditions in your area, so it provides a more reliable estimate of how much power panels on your home can provide.
Solar Panel Policy History in South Dakota
Unfortunately, SD is a latecomer to the renewable energy scene, and it has passed minimal pro-solar legislation to make converting to solar energy more appealing. There are a handful of perks for energy efficiency upgrades, though.
The first rebate programs were established in 2006 by Black Hills Energy and Southeastern Electric Cooperative. While not exclusively for solar, these did help push energy efficiency upgrades in SD.
SD began offering the large commercial wind and solar alternative tax program in 2007. This was an exemption for property taxes for large-scale solar farms above 5 megawatts (MW). This served mostly to benefit community solar programs.
In 2008, the Otter Tail Power Company began offering a rebate for energy efficiency upgrades as well. Once again, solar equipment was not included.
That same year, SD set its first Renewable Portfolio Standard (RPS) goal, which was for a minimum of 10% of the state’s power to be generated via renewable energy sources by 2015. Unfortunately, this was a voluntary goal, so there were no penalties for falling short.
In 2009, the Public Utilities Commission (PUC) in SD established interconnection standards. These set up how solar electricity customers would be patched into the electric grid, and it helps establish a foundation for net metering if it’s ever offered.
2010 brought with it the solar and wind easement law in SD. This law set up directives for requesting easements for access to solar energy from neighboring properties.
That same year, the state began offering the renewable energy system exemption, which was a partial property tax exemption for solar equipment. This was South Dakota’s first financial solar incentive, and it helped keep taxes down after solar conversions.
Most recently, in 2012, 12 utility companies began offering residential energy efficiency rebate programs that incentivized energy efficiency though they were not explicitly targeted to solar.
While most of these South Dakota incentives are not specifically for solar conversion, they do show promise that the state is taking energy efficiency seriously. Hopefully, a firm RPS goal will be set in the near future, and additional policies — like net metering — will be put in place to help reach it.
What Are the Solar Panel Incentives in South Dakota?
As you might have guessed, based on the lack of pro-solar legislation discussed above, there are very few perks available for solar power systems in SD. We’ll discuss the two benefits available below.
- Federal Residential Clean Energy Credit: Formerly known as the solar investment tax credit, this federal incentive is a credit to your income taxes owed for the year you install your system. It comes out to 30% of your total solar project value or an average of around $7,500 in SD.
- Partial property tax exemption: This policy helps prevent your taxes from increasing after solar conversion, even though your property value will increase.7
For more information on these benefits and how to take advantage of them, you can read our guide for South Dakotans on solar benefits.
Find a Local Installer in South Dakota
Choosing a solar installer is a critical decision that affects your system costs, the quality and durability of the equipment installed, the warranty you get, and more.
We’ve done thorough assessments of the top installers in SD and have included reviews of each of them in the articles referenced below. These should help get you started with strong and reliable providers.
For general company recommendations or for solar companies outside of these major cities, you can read our guide to choosing a reliable solar installer in SD.