South Dakota Solar Guide 2026

South Dakota offers moderate solar conditions with good sun hours, though limited incentives and modest electricity rates moderate returns.

Updated March 2026 · Sources: Xcel Energy, DSIRE, EnergySage, NREL · Research by Dana Mercer
#45 solar state Good sun hours
Avg install cost $2.80/W Before incentives · Q1 2026 · EnergySage
Electricity rate 12¢/kWh Statewide avg · EIA Jan 2026
Peak sun hrs/day 4.5 hrs State avg · NREL data
Typical payback 11-13 yrs After federal ITC
Solar rank #45 Installed capacity · SEIA 2025

Get quotes from South Dakota installers (2 minutes)

Compare South Dakota solar quotes free →

Affiliate link - quotes are always free and no-obligation.

South Dakota provides moderate solar conditions: With 4.5 daily peak sun hours and 12¢/kWh electricity rates, the Mount Rushmore State offers reasonable solar fundamentals. Xcel Energy serves eastern South Dakota with net metering, though limited state incentives moderate returns.

For Sioux Falls and Rapid City residents, solar systems typically take 11-13 years to pay back. Good sun exposure helps offset modest electricity rates, but limited incentives affect overall economics.

South Dakota solar incentives (2026)

Incentive Amount Status
Federal ITC 30% of system cost Active
Xcel Energy Net Metering Full retail rate Active
Property Tax Exemption Not available None
Sales Tax Exemption Not available None

South Dakota solar install costs (Q1 2026)

System size Gross cost After ITC Annual savings Payback
6 kW $16,800 $11,760 ~$1,030/yr ~11.4 years
8 kW $22,400 $15,680 ~$1,370/yr ~11.4 years

Get competing South Dakota solar quotes

Get free South Dakota solar quotes →