Solar Power in Tennessee: All you need to Know!

sunny Tennessee makes a good solar investment

Look to the sun, and Tennessee is state that should be well down the road of harnessing its solar power potential.

After all, this is the state that spent 50 years taming its rivers to make cheap, clean electricity. Solar power should be a cinch.

But solar PV isn’t just a cheaper, cleaner, high-tech complement to dams and hydro power. It also spells out energy independence for the homeowner. And self-generated electricity means less business for the utilities.

That’s why help is needed from the powers-that-be to let the solar genie out of the bottle.

So is the Tennessee—birthplace of so much that’s musical in America—rocking and rolling to solar power beat? Or is it suffering from a bad case of the blues?

The answer, just like the state’s musical heritage, is a something of a jarring mix. On the one hand the state government couldn’t have taken less interest in helping homeowners go solar.

On the other, that mammoth monopoly, TVA, has leapt into the breach, doing what they can to birth sun-powered electricity in Tennessee for the little guys.

They’ve helped make solar-powered homes a reality for many here. But the assistance from the Tennessee Valley Authority has limits—both in the money available and the time left to sign up.

So if you’re looking to solar energy saves money, while saving the planet, you’ll need to move fast with your Tennessean solar plans.

Luckily, we can help you move things along, and all it takes is a few clicks. Just fill out the details on our solar questionnaire & we’ll put you in touch with carefully vetted Tennessee solar installers. That way you can cut the chase, and get those panels on your roof quick.

Even if you don’t have the cash up-front, Tennessee is still a good place to go solar.

Unlike many other southern states, zero-down options are on the table here.

So Tennesseans can see big savings on their bills without having to spend a cent upfront.

But more on that later. Whether you’re thinking of buying, leasing, or loaning—or not quite sure which will be right for you—here at Solar Nation, we can give you the low-down on the big numbers that matter.

Not just on cutting CO2, cleaning the air, and creating jobs. But on the big savings to be had for you, and your family, from decades of low-cost, sun-powered electricity.


Tennessee Solar Power: Check your Savings, Costs, Tax Breaks, Incentives and Rebates

solar power raises the value of your home and helps the planetNo-one can doubt that solar power’s changing the world. It’s bringing power back to the people. It’s helping to save the planet.

But what about the bottom line—the savings for you.

How much money will you make from stepping forward into the sun, here in the Volunteer State?

Return on Investment for Residential Solar Power in Tennessee

Let’s start by assuming you’re looking to buy an average-sized solar system for an average-sized house in Nashville. Don’t live in Nashville? Don’t worry.

The sun shines just as brightly on the blues bars of Memphis and the theme parks of Knoxville.

Once you have 5 kW of solar panels on your roof, they’ll likely last for 3 decades. So even though you’ll have paid out a hefty stackat the start, your savings will continue for years to come.

It’s a bit like buying a stock as an investment. You know you’ll be receiving lots of dividends for years to come.

That’s how we at SolarNation see solar — as an investment.

And we like to calculate the average solar return for you, so you can compare it to other investments.

We reckon that over 25 years, the return for a 5 kW system humming along on a Nashville roof would be about 7 to 8%. That’s pretty darn good.

Surely good enough to get a thumbs up from your financial adviser!

But let’s break those numbers down a little bit.We bet you also want to see the dollars you’ll pay out—and the dollars you’ll rake in.

Buying a 5 kW Solar System—a Tennessee case study

With prices still falling for solar panels, a 5 kW system will be something a shade over $16,000 for an outright purchase. Not a small sum, it’s true.

Not to worry, though. We haven’t included things like the federal ITC.

That’ll make a big difference to all you taxpayers out there. Or the sales tax exemption for solar PV systems. And don’t forget zero-down options can mean you can actually pay out nothing upfront at all.

So what will those panels be doing for you (and the planet) while they’re sitting up there soaking up all that gorgeous Tennessee sunshine?

Going solar in Tennessee

First the headline benefits ofa solar-paneled roof:

1. An average of 20 kWh of electricity generated for you daily.

2. In June,you could be looking at 25 kWh each day.That’s going to help the air-con to breeze through summer when the heat hits.

3. Over 12 months that adds up to nearly 7,000 kWh of electricity off of your utility bill!

4. That means the average Tennesseanbill is cut in half.

5. Even better, over a ton of coal is kept in the ground—and out of Tennessee’s power stations—every year.

6. That’s like planting and growing 100 trees on the Blue Ridge Mountains!

So your panels are helping to green Tennessee.

But what about the costs, you ask?

1. Well, you’ll have to pay $15,000 for the panels first.

2. And Tennessee’s 7% sale tax would bump that up to $16,000.

3. Except that it doesn’t. We have a sales tax exemption here for solar, so back down we go to $15k.

4. Now here comes the 30% federal Income Tax Credit (ITC).That slashes your first year outlay to $10,500.

5. And you’ll be saving from the word go, so off goes another $780.

6. So you’ll only have paid a measly $9,780 in those first 12 months.

That’s doesn’t look too shabby against the money you’ll be saving:

1. Over the system’s 25-year lifetime you’re looking at an absolute minimum of $20,000 saved. That’s assuming electricity rates stay at the average $0.10c/kWh we paid in 2015.

2. They won’t. Rates grew at 3% per year over the last 10 years in the U.S.

3. That would make the savings on your $9k investment jump to nearly $27,000!

Tens of thousands of dollars’ savings from less than 10-thousand dollars of investment.

That doesn’t sound like a deal to turn down!

If you’re ready to turn on to savings potential of solar, it couldn’t be simpler. Fill out a few details on our solar questionnaire, then we’ll put you in touch with local installers, that will talk you through big numbers: panels installed, forests saved, and kilowatts hours generated. And the biggest numbersof all—dollars saved.


Tennessee Solar Power Incentives, Tax Breaks and Rebates

As we’ve already said, Tennessee’s legislators haven’t really been keeping their eyes on the ball, when it comes to solar. In fact, they don’t even seem to have noticed that there’s a new energy kid on the block.

As a result, state incentives, tax breaks, and rebates are pretty thin on the ground in Tennessee.

That’s not the case with the state’s main utility, the Tennessee Valley Authority.

And whatever power coop is sending your bill, it’s likely the TVA will be the ones actually providing the power.

Fortunately for solar power, TVA have jumped into the breach left by the state’s absence. They have provided a decent mix of help for those customers choosing the sun over the state’s traditional coal+water+gas energy mix.

Let’s run through exactly who’s offering what to whom.

Tennessee RPS

Renewable Portfolio Standards (or ‘RPS’, see below) have been vital in kick-starting the solar revolution across the U.S. By setting binding targets on utilities to generate electricity from renewable sources, they’ve encouraged power companies to help customers make the switch to the sun.

Unfortunately, Tennessee is one of the few remaining states not to adopt an RPS.

That means any incentives that are offered to homeowners are only thanks to the goodwill of the utility.

Luckily TVA has had plenty of the latter, and has forged ahead with its own ideas. More on those in a moment.

What is an RPS really?

In many states you’ll hear about how its ‘RPS’ is a big deal, when it comes to boosting solar energy. But what exactly is a‘Renewable Portfolio Standard’?

Basically, it’s a state law passed to promote clean energy, by setting targets.

RPS’s have been really helpful in getting the utility companies on-side, when it comes to the big switch-over to renewable.

When a state sets an RPS target, it’s saying that the utilities must generate a certain amount of their electricity from renewable. Usually they’ll set a date, and if the target isn’t met, the utility will be fined.

That’s a great push factor for getting power companies to promote new clean energy like solar power.

The threat of fines makes the utilities extra keen to offer their customers incentives, rebates, and grants for their solar systems. Everyone wins.

They avoid the fine, and you get the low-cost solar power. Oh, and the planet gets saved.

Without an RPS, utilities are much less likely to help with solar or wind power for their customers.

That said, some of the more forward-looking power companies will lay out a few goodies for those wanting to do good for the planet. Even here in Tennessee (see Rebates below).

Tennessee tax credit

Tennessee doesn’t currently have a tax credit for homeowners switching to solar. That’s not so surprising.We don’t actually have state income tax, after all!

So the only tax credit you can claim is the ITC that the federal government offers. But no need to be glum—a 30% cut in your expense is a pretty big deal.

Are there any Rebates for Solar Power in Tennessee?

A bit of a blank is drawn here too, at least when it comes to the state government. The TVA has stepped up to the plate, though, with their $1,000 rebate.

That’ll take your initial outlay for a 5 kW system to under $8k net cost, in your first year.

Tennessee Tax Exemptions

Tennessee has a 7% sales tax, but in a rare hat-tip to the good that solar does, this was waived back in 2010.

That means you’ll get your shiny new solar system installed at the installer’s list price.

A trick has been missed on the property tax exemption, though. This is commonly used in other solar-friendly states. It’s needed because, when you add panels to your roof, your home goes up in value.

After all, your house now has 25 years at least of energy savings built into it. However, it does seem a bit unfair that this increase in value should count towards your property tax. You’redoing you bit for the environment, local jobs, and energy independence.

But in Tennessee you’ll be taxed a little bit extra for the privilege of helping out.


Tennessee Electricity Rates

Electricity costs in Tennessee runs well below the U.S. average, at around 10 c/kWh in 2015. Given that the average home nationally pays out 12.7 c/kWh, that’s got to be good news?

It might seem so. But those lower rates come at a price. With a heavy coal presence in Tennessee’s energy mix, costs are really being felt by those suffering from health problems, thanks to air pollution. And by a planet suffering from a CO2-induced fever.

Tennesseans are also big energy guzzlers. We use a lot of electricity to keep our houses comfortable in the summertime. Put panels on your roof, though, and you’ll be using the sun to help keep you chill in the summer. Not just cool, but clever too.

After all, you’ll be saving yourself from a future of rates that are leaping ahead (at nearly 5% a year over the last decade). Why wait?


Is there Net Metering in Tennessee?

though there is no net metering in Tennessee it is still worth the initial UV investmentNet Metering pairs up with solar PV panels like hot dogs and chili sauce. It’s hard to imagine one without the other. In Tennessee, though, you’ll have to.

There’s no state-legislated Net Metering scheme here.

Net Metering is needed to ensure that any excess electricity you produce from your solar system doesn’t get wasted. But luckily, here again comes TVA with a solution.

As part of its Green Power Provider program (which replaces the Generation Partners pilot program), TVA commits to buy all of your excess electricity at the retail rate. That’s pretty much Net Metering by another name.

Credits can be rolled over month to month, or even year-by-year—but that’s at TVA’s discretion.

There’s also the potential for a premium payment, but more on that under our Feed In Tariffs section.

The big drawback is that there’s only a limited capacity for the program. It can only be enrolled into during a narrow time-window, as well.

Timing is of the essence.

That’s why we recommend getting in touch with your local solar experts now. Just fill out a few contact details on our solar questionnaire, then we’ll put you in touch with local companies with the inside-track on TVA’s programs. You can choose from Tennessean installers who’ll work hard to get those panels on your roof

What's net metering anyways?

Net Metering is a vital part of making solar power work for homeowners. It means nothing is wasted, even when the power you generate and the power you use aren’t exactly balanced.

That’s important because the power your system produces varies as the sun moves round the sky.

When the sun is high in summer you may actually produce more electricity than you use. Under net metering, that extra power gets sent to the grid. And you become the power station for the utility.

Rather than letting that spare power go to waste, Net Metering means your meter effectively spins backwards. And as it spins, it earns money for you from those unused electrons

That’s because the utility has to pay you for the energy you’re supplying to them under Net Metering.

Often this is at the retail electricity rate, the rate you normally pay them!

Welcome to the wonderful world of energy independence!


Are there 0 down payment financing Options in Tennessee?

Yes, even though the law in Tennessee isn’t completely clear on the status of third-parties. You’ll need a third party to sort out zero-down options, like leases and PPAs.  

But there are firms out there who are offering these sorts of deals. And they are commonly used elsewhere across the U.S. these days.

With each option, of course, you’ll have different responsibilities and paybacks. But with all of them, you’ll be making some sort of saving, even though you’ve made no down payment.


Are there Solar Leases in Tennessee?

Yes, there are. Solar leases have become the bright new future of late. These involve you leasing a system from a third-party solar company.You simply pay them a monthly leasing fee for your electricity, and they then install and look after the panels on your roof.

There are a couple of things to look out for, though.

First, make sure you have a performance-guarantee clause. This states that certain amounts of energy should be produced from the panels on your roof. With them, your leasing company will stay on-the-ball,making sure your system is in tip top condition.

Second, you may notice your fee will be slightly higher, at the start, than your utility bill savings.

Don’t panic. It’s all because Tennessee’s utility rates are still relatively cheap for the U.S.

But in soon enough you’ll see those utility rates over taking those lease payments, as the cost of electricity rises. So you will save in the long run. Especially as, in Tennessee’s case, rate rises have been as much as 5% per year recently.


Solar Power Loan?

If you’d prefer to own your solar panels, for only a small (or even no) outlay, then a solar loan makes sense. This way you’ll get better rates of return, especially if you can tap a home-equity line of credit.

You’ll soon be solar powered, and you won’t have to raid your cash savings.

If you’re a taxpayer, you’ll also benefit from the federal ITC. With most solar loans easily funded from the 25 years or more of bill savings, interest rates are often low. You will, however, be on the line for any maintenance or cleaning that your panels need.


PPA Option on Tennessee?

This is the other approach for going solar with no (or little) upfront cost. PPAs are similar to leases, but rather than paying a fee to lease the panels from a third-party, you’re only paying for the power that they produce.

No hassles of ownership. No worries about performance. And no big down-payments.

And while Tennessee’s ambiguous law has made them less common than leases and loans, they’re still up for grabs by the state’s homeowners.

What is PPA?

A Power Purchase Agreement, or PPA, is an agreement between you and your solar panel provider. You provide them with the roof for the panels. They provide you with power at a guaranteed price.

Like a lease, you’ll benefit from solar power without worrying about details like planning, installation, equipment upgrades, maintenance, and cleaning.

Most PPAs also have an option for you to buy the system at the end of the contract,which can add real value to your home.

One thing to look out for here is the PPA price escalator. This is where the PPA price rises gradually throughout your PPA contract, according to an agreed schedule.

These escalators are a reasonable way for the solar panel company to take gradual performance and maintenance issues into account over its lifetime.

Just make sure your PPA escalator isn’t too steep. It should be much less than expected utility rate rises.

If a PPA seems like the best deal for you, then now’s the time to lock in those bill savings, just fill out our Tennessee solar panel installation form here. Once you’ve provided us with some basic details, we’ll connect you to respected local firms, they’ll help you to quickly turn your solar dream into reality on the roof.


Is there Feed in Tariff in Tennessee?

No, unfortunately not. To be honest, Feed In Tariffs are still as rare as hen’s teeth here in the U.S.

But there are still some performance-based payments available, courtesy of good old TVA.

If you’re paying a utility or electricity co-op in their area, you could tap into these.

It’s all part of the Green Providers Program we’ve already mentioned. Right now,it’s worth an extra 2 cents for each kWh you send to the grid.That premium payment only lasts for 10 years. But that could add up to hundreds of dollars for a mid-sized system.

As we’ve already said, though, that Program has a limited capacity. So you need to time your application right—and move fast. That’s especially true today, as there’s talk of phasing the premium out on the near future.


Leasing vs Purchasing: What's best for Tennessean Homeowners?

The choice between what’s best for you depends on your appetite for risk and reward. And also how much cash you have to hand to invest in the solar dream.

Leasing works well for the risk adverse, and the cash poor. It’s for those who are keen to do their bit to save the planet, but who don’t want to make big payments up-front for the privilege. But because of Tennessee’s low electricity rates, don’t expect mammoth savings.

Purchasing is ideal for those who have the money to buy outright. It’s for those who want to fully enjoy all the benefits—financial and environmental—from switching to sun power.

With Tennessee’s low electricity rates and incentives, this may be the best way to maximize your returns.


What is the Solar Panel Installation Process in Tennessee?

The solar installation process starts with home visit by an energy assessment team. They’ll talk to you about your bills, how best to site your system, the best solar panel manufacturers and the financial options available.

Once they’ve got the measure of your place, and found out exactly what your needs are, they’ll be provide you with a fully detailed PV quote.

This will highlight potential tax rebates, breaks, and incentives that may be available to you.

They’ll also give you detailed breakdown of the savings you can expect to make.

Once you’ve agreed and signed your agreement, the solar installation team can schedule a date for transforming your house from energy sink into a solar-powered energy producer!

The installation process usually only takes three to four days.

All it takes is a few simple steps:

1. Fill in our simple solar form

2. Receive quotes from the best local solar suppliers

3. Choose the best money-saving solar option for you

4. Once your system is installed, just sit back, relax—and watch the savings roll in



a quarter of the stater electric power can come from solar panel installationsTennessee is a southern state that seems to be staring at the solution to its energy needs, without even noticing.

It’s reckoned that nearly a quarter of the state’s electricity could come from just from rooftop solar.

The money side looks promising too.

And because pollution levels are quite high, those going solar in Tennessee will make a big difference to the environment — both locally and for the planet.

It’s true that the mood music for Tennessee’s solar transformation could be better.

But waiting for the band to join in has never been Tennessee’s style.

Being ahead of the rest didn’t stop Sonny Boy Williamson. It didn’t stop Elvis.

Are you ready to be one of the leaders of pack for Tennessee’s new energy independence revolution?

If so, we can help kick things off for you. Just fill out our Tennessee solar panel installation form, provide us with some basic details about you and your home. We’ll then be able to connect you with tried-and-trusted Tennessean installers who’ll have you singing from the solar song sheet in no time.

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