Star power

Looking much the same as the other homes in the Parrot Bluff neighborhood on James Island, Stephen C. Miller's house doesn't hint at the thousands of watts of electricity surging from his rooftop into his power system.

Miller's new 14.1-kilowatt solar energy system -- discreetly hidden in the folds of his angular roof -- marks the completion of South Carolina's largest residential solar installation to date.

The milestone comes after more generous federal tax credits, put in place last year, unleashed a flurry of homeowner interest in renewable energy projects. Local companies that install sun-powered panels say inquiries are near an all-time high because of ever-rising electricity costs.

But the solar industry still grapples with a number of challenges, particularly the daunting upfront costs, though that has started to change. A worldwide glut of photovoltaic panels caused prices to skid about 40 percent in 2009, triggering new renewed interest in the alternative energy source, according to the Solar Energy Industries Association. Still, the average residential system that can convert the sun's rays into electric current can run between $15,000 and $50,000.

Utilities, municipalities and the federal government have tried to create pools of loans for homeowners to tap, but some of their efforts have fallen short. And even if a homeowner can afford the initial investment, South Carolina joins a minority of other states that don't protect homeowners who want to install solar panels but are barred by local neighborhood restrictions.

Still, renewable energy experts say the trend is gaining in South Carolina.

"We're staying busy, so people are obviously finding ways to invest in these systems," said Ian Street of Columbia-based Argand Energy Solutions.

Giving credit

Despite the recession, the industry saw a growth spurt in early 2009, when the Obama administration removed a $2,000 cap on a tax credit that was created as an incentive for homeowners who switch to solar. That federal credit now allows taxpayers to subtract 30 percent of the cost of a system from their reported income.

"That's when the market just took off, and it's been growing ever since," said Andrew Streit of Greer-based Sunstore Solar Energy Solutions, who installed Miller's system.

South Carolina offers its own tax credit set at 25 percent of the cost of a system. The amount is capped but can be used to offset a tax liability for several years.

Still, South Carolina's solar use lags behind other states. Combined, the Palmetto State's commercial and residential solar systems can process up to 0.4 megawatts -- an amount that falls behind 28 other states, according to the Solar Energy Industries Association, which tracks data in 41 states.

"(Other states) have had policies that have driven growth there," said association spokesman Jared Blanton, whose Washington, D.C.-based group represents renewable energy companies.

Solar panel installation is trickier for coastal homes. To hedge against hurricane-force winds, installers have to use extra bolts to secure the panels, and newer elevated homes make the job more dangerous, requiring harnesses and extra attention during some installations.

Streit said he has installed systems for a range of personalities: patriotic folks who cite national security concerns; aging hippies who have scrimped to save up for a system; vacation property owners who are sick of paying higher rates on multiple utility bills; and engineers who are drawn to emerging technology.

Miller, a cardiologist, cites his own range of reasons, from morality to cost-cutting practicality.

"It's not 15 years ago when energy and gas is cheap," he said, declining to say how much his system cost. "Everything is very costly."

His bills are now a fraction of their former cost. Last year, he spent $563 to power his three-story marshfront home during June. This year, the same expense came in at $261.

Roadblocks

Solar experts agree that, despite the long-term savings, the upfront costs of a solar panel system remain the industry's biggest barrier. As a result, policymakers and utility companies are trying to make money available to homeowners who can gradually pay back the cost once their power bills recede.

The city of Charleston, for example, is putting together a $2 million fund for residents and businesses who want to borrow money for upgrades. That program could start as early as December.

Brian Sheehan, Charleston's director of sustainability, said the city was able to finance $13.5 million of its $18 million green improvement projects, but most homeowners wouldn't be able to pay for a proportional amount.

About $150 million in federal stimulus money was dedicated to loans for renewable energy programs through what's called PACE, or Property Assessed Clean Energy. But state law in South Carolina doesn't allow municipalities to create districts that enable homeowners to tap into that money.

Sheehan and the Charleston-based Coastal Conservation League tried to persuade legislators to change that last spring, but the lending lobby raised concerns over who would be the first to recover money if the homeowner goes into default.

"We expected concerns, but we thought we could work through those concerns," said Hamilton Davis, the league's energy and climate director.

That program hit a bigger roadblock last month when mortgage-finance giants Freddie Mac and Fannie Mae objected to the PACE program.

Davis said individual power companies have had the most success at making renewable energy money available.

Berkeley Electric Cooperative customers can borrow up to $10,000 for energy-efficiency projects through a program that's been around since the 1980s. But no homeowner has yet to borrow money to pay for a solar panel system.

"Solar power is an expensive endeavor," said Eddie Plowden, the utility's marketing manager. "Normally, folks who are more affluent and wouldn't need financing from us" install the systems.

Community standards

Once financing is in place, homeowners can still face one last hurdle: their neighborhood association board.

A growing number of residential communities are governed by legally enforceable documents called covenants, which lay out rules about parking, paint colors and landscaping guidelines. These rules can discourage the use of solar panels and other items such as clotheslines based on aesthetic standards.

Local solar company officials said they've met with homeowners who want to install solar panels but can't because of their HOA rules. At times, Erika Myers, the S.C. Energy Office's renewable energy manager, has been called in to moderate the debate.

"Sometimes it's taken well, sometimes they still deny the request," she said.

Myers' office created a "solar-friendly communities" program, which acknowledges neighborhoods that adopt panel-friendly policies. So far, only one Hilton Head Island community has taken advantage of the statewide program.

Thirty-four other states have avoided neighborhood battles over solar panels by enacting legislation that protects a homeowner's right to install the panels and limits unreasonable rules against them. South Carolina lawmakers considered enacting their own law in early 2009, but the bill has failed to rally support since its introduction.

Meanwhile, the panels that cover half of Miller's roof on James Island aren't visible from the street, shielding him from controversy. When he argued his case in front of his neighborhood's HOA board, he said no one objected to his plan.

"They understood getting energy from the sun is a good thing to do," Miller said.

Reach Katy Stech at 937-5549 or kstech@postandcourier.com.