Most of Tennessee runs on nuclear power, which provides 43% of the state’s electricity in 2021. Only 3% of Tennessee’s electricity came from solar panels, and the state barely offers any incentives for its residents to go solar.
But Tennesseeans are getting solar panels anyway. There are roughly 77,880 residential solar installations in the state, according to the Solar Energy Industries Association. One big reason solar looks appealing? Solar panel prices are dropping as power bills are rising.
For those looking to go solar, the biggest bit of financial help is from the federal government — a 30% tax credit authorized by the Inflation Reduction Act, passed by Congress in 2022. Unfortunately, the Volunteer State isn’t offering much in the way of state-level incentives for residents looking to install rooftop solar.
Here’s what you need to know before going solar in Tennessee — starting with the best solar installation companies operating within the state.
National solar panel companies in Tennessee
There are 141 solar companies in Tennessee, with 60 of these companies being installers or developers, according to the SEIA. Even though you have a lot of installer options, you should still try to get as many quotes as you can to make sure you get the best price possible. Here are a few installers servicing Tennessee.
SunPower Solar
Best solar panels
If you’re looking for top-of-the-line solar panels, SunPower is your best choice. But don’t write it off if you’re looking for a less flashy installation that will get the job done. This year it started installing Qcells panels, which should make an installation from the longest-tenured company on our list available to more people.
Tesla Solar
Most affordable
Tesla’s solar branch seems to be the least loved of Elon Musk’s ventures. Even Tesla’s Solar Roof seems to get more love.
If price is the thing you won’t budge on, consider Tesla. By all accounts, Tesla installs quality panels and makes the closest thing there is to a household name in solar storage: the Powerwall.
Where you might miss out is customer service. Discussion online seems to suggest Tesla’s service is a bit of a gamble.
Local solar panel companies in Tennessee
Big national installers aren’t your only options. Here are a few local solar installers to consider.
LightWave Solar has been installing solar in Tennessee since 2006. It offers rooftop and ground-mounted solar panels, as well as panels mounted on canopies. The company also installs battery backup systems. It offers a five-year workmanship warranty. Note that LightWave Solar usually requires a 25% down payment upon signing a solar contract.
Nashville Solar Works is a local installer servicing parts of Tennessee. It works with professionals certified by the North American Board of Certified Energy Practitioners to install solar panels and batteries. To help you size your system correctly, Nashville Solar Works also offers a free home energy audit before starting anything else. Financing options are available through a third party.
How to determine which solar company in Tennessee is best for me
Solar is a costly, long-term investment. And you’ll want to make sure you’re picking the right installer for the job. Finding a trustworthy installer can be a tricky process, but there are a few general things to look for during your search. Here are some tips to help you find a reputable installer.
- Understand federal, state and local solar incentives. Make sure your installer can accurately explain how tax credits and incentives work.
- Read online reviews from multiple sources. Google and Yelp are a good place to start.
- Get recommendations from neighbors who have solar installed.
- Check an installer’s licensing and certifications. Look for installers who are certified by NABCEP.
- Compare multiple solar quotes.
- Ask your installer all your questions, even the difficult ones.
- Assess your potential savings cost and your solar payback period. Your installer should be able to explain this to you.
Cost of solar panels in Tennessee
Here’s a look at the average cash price for a typical solar panel system in Tennessee before factoring in tax credits and incentives, according to data from FindEnergy.com.
Average cost of solar panels in Tennessee
| Typical system size (kW) | Price per watt | Total installed cost | Cost after 30% federal tax credit | |
|---|---|---|---|---|
| Tennessee | 10 | $3.58 | $35,800 | $25,060 |
| National average | 8.6 | $3.67 | $31,558 | $22,091 |
Below, you’ll find an infographic displaying the average total cash price, cost per watt and typical system size for a solar panel system in your state, according to data from FindEnergy.com. The map’s prices don’t factor in potential rebates from tax credits or state incentives. Certain states don’t have any FindEnergy solar data and are grayed out on the map.
Tennessee solar panel incentives and rebates
Tennessee doesn’t offer many incentives for its residents to go solar.
“It’s really important to have a strong state or utility-level solar policy,” said Jill Kysor, senior attorney and leader of solar initiatives with the Southern Environmental Law Center. “Without a good policy from your utility, it can be really tough to make it work. There’s great opportunities out there right now with the IRA, but we still need utilities to have good policies in place for folks to really benefit.”
Tennessee is one of the few states in the US that doesn’t have rules around net metering, the process of selling excess energy to the power grid. The Tennessee Valley Authority owns more than 90% of the state’s electricity generating capacity, and offers a program similar to net metering called the Dispersed Power Production Program. Keep in mind that this program is not a true net metering policy. And Tennessee’s clean energy sales tax exemption is only available for commercial and industrial solar projects, not residential.
“Most people living in Tennessee are served by a local power company that buys its electricity wholesale from TVA,” Kysor said. “TVA has several programs for rooftop solar customers, but they do not offer any traditional retail-rate net metering to customers flowing through the local power companies.”
As far as federal incentives go, homeowners can take advantage of the residential clean energy credit. This incentive allows you to claim 30% of the total cost of your solar system back in tax credits.
Here’s a closer look at the solar incentives in Tennessee.
Tennessee solar incentives
| Program | Description |
|---|---|
| Residential clean energy credit | This is a federal tax credit allowing you to claim 30% of the total cost of your system back on your federal taxes. |
| Green Energy Property Tax Assessment | Tennessee has a property tax assessment for certified green energy production facilities. This tax assessment limits the taxable value of having a solar system on your property. If you have solar panels, your assessed property value may not exceed 12.5% of installed costs for solar. |
| Dispersed Power Production Program | Operated by the TVA, this program allows you to sell your excess solar energy to the TVA at its avoided cost rate. |
How to pay for solar panels in Tennessee
Solar panels are a serious purchase, so it’s good to know all your buying options beforehand. Weigh all your choices and pick a purchasing method that works best for your situation. Here are a few ways you can pay for your solar panels.
Cash: If it’s in your budget, paying cash upfront is the best way. There’s no interest or financing fees, and you’ll always be eligible for tax incentives. If you think solar might be a future investment, consider saving up in a high-yield savings account. This will net you more money over time.
Solar loan: If you need to finance your solar panels, most solar providers will offer you a solar loan. These loans will either be through the solar provider themselves or a third-party financial institution. However, be mindful that a solar loan might come with high interest rates and other fees.
Other types of loans: Explore other financing options beyond a solar loan. Taking out a personal loan with your bank or opening a home equity line of credit are just a couple other financing options for your solar panels. If you choose to go with a HELOC, be aware of the risks involved. Your home becomes collateral, and if you can’t pay back what you owe, your home could face foreclosure. With any loan, whether from a third-party lender or a solar provider, shop around and compare rates and terms before making a final decision.
Lease or power purchase agreement: You don’t have to own your own solar panels if you don’t want to. You can either enter a lease or a power purchase agreement. If you enter a solar lease, you’ll pay for the use of a solar system owned by the solar company. On the other hand, if you enter a power purchase agreement, you’ll pay for electricity generated from a company-owned solar system at a fixed rate. The fixed rate from the solar company is usually lower than the retail electricity rate from the local utility company.
Installation factors to keep in mind
Solar is an incredibly site-dependent purchase, with some homes being better suited than others. Here are a few installation factors to keep top of mind as you decide if solar is right for your home.
Condition of your roof: Some roofs are not suitable for solar panels due to factors like age, damage, angle, pitch and tree cover. These factors can impact the efficiency of your solar panels as well. Solar panels perform best on roofs angled between 15 and 40 degrees facing south, according to the US Department of Energy. A trustworthy solar installer will perform a roof inspection before solar installation.
Insurance coverage: If your homeowners insurance agency covers solar panels, consider adding your panels to your policy.
Location: The more peak sunlight hours your state has, the more efficient your solar panels will be. Tennessee gets a decent amount of sunlight, with an average of 4.1 to 4.5 hours of peak sunlight per day.
Homeowners association regulations: Because solar panels change the look of your home, your HOA might have certain rules and regulations around installing solar panels. If you have an HOA, make sure to check with them before installing solar.
Financing options: If you can’t pay cash upfront, there are various financing options available to pay for your solar panels. Solar loans, personal loans, solar leases and power purchase agreements are just a few options worth considering. Solar is a big investment, so do your research and find the best payment method that best works for your situation.
How we found the best solar panel companies
The companies we listed above as “the best” are curated from CNET’s best solar companies list. Companies making the best list are scored on the equipment, warranties and customer service they offer. Then, we make sure these recommendations are available in your state. You can read a full breakdown of how we review solar companies here.
Companies listed under the local installers were chosen in a less rigorous way. We chose them because they offered something unique or notable to customers in the state, they seemed well-regarded by internet reviewers or because they were one of the few installers we could find information on in the state.
Whether we’ve completed a full review on a company or not, it’s always a good idea to get multiple quotes from different installers before choosing a company.
Tennessee solar power FAQs
Is solar worth it in Tennessee?
It depends on what you’re looking to get out of solar. Solar is expensive, and Tennessee doesn’t offer many incentives or benefits toward solar installation. The state is also one of the few states in the country that doesn’t have net metering. However, solar is beneficial for those wanting to reduce their carbon footprint, spend less money on electricity from their power provider and establish energy independence.
Does Tennessee offer state solar incentives?
Tennessee only offers one state-level solar incentive, the Green Property Tax Assessment. This tax assessment limits the taxable value of having solar put on your property by 12.5%. The best incentive Tennessee residents have is the federal solar tax credit, also known as the residential clean energy credit. This is a federal tax incentive that allows you to claim 30% of the total cost of your solar system back in tax credits.
How long do solar panels last?
The average lifespan of a solar panel is typically between 20 and 30 years. However, there are certain factors that can affect your panel’s lifespan, like climate, the quality of installation, proper maintenance and the type of panel.
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