Why do Hawaii consumers pay the highest electric rates in the nation? Well it costs a lot to ship oil and gas all the way over there. Luckily Hawaii is quite progressive when it comes to embracing renewable energy. Read on for more details about Hawaii solar rebates and incentives.
Originally enacted in 1976, the Hawaii Energy Tax Credits allow individuals to claim an income tax credit of 35% of the cost of equipment and installation of a solar thermal or photovoltaic system.
The maximum allowable credits are as follows:
- Single family residential property is eligible for a credit of 35% of the actual cost or $5,000, whichever is less;
- Multi-family residential property is eligible for a credit of 35% of the actual cost or $350 per unit, whichever is less.
Feed in Tariff
In September 2009, the Hawaii Public Utilities Commission (PUC) issued a decision that established a feed-in-tariff in Hawaii. The feed-in tariff will be offered by the three investor-owned utilities: HECO, MECO and HELCO. In October 2008, the PUC opened a docket to review the development of a feed-in tariff. The creation of the feed-in tariff is in accordance with the Hawaii Clean Energy Initiative, and serves to formalize some of the goals established in 2008.
Several renewable energy technologies are eligible for the feed-in tariff, including solar photovoltaics, concentrating solar power, on-shore wind and in-line hydropower. Under this program, qualified projects will receive a fixed rate over a 20-year contract. The PUC must still set the rate for different renewable energy technologies. This program will be reviewed by the PUC two years after the start of the program and every three years thereafter.
Property Tax Exemption (Honolulu only)
If you live in Honolulu then you can take advantage of the property tax exemption for additional value added to your property from the installation of your solar energy system.
Net metering is in force in Hawaii but there are caps on how much they will accept. The current limits are 3% of utility’s peak demand for HELCO and MECO utility companies and 1% of utility’s peak demand for KIUC and HECO. Excess electricity can be carried forward in the form of a kilowatt-hour (kWh) credit that is applied to your next bill. These credits may be carried over for a maximum of 12 months. At the end of the 12-month period, any remaining customer credits are surrendered to the utility without compensation (unless the customer enters into a purchase agreement with the utility).
|Av. Monthly Electricity Bill||$120|
|System Size||5.0 kW|
|% Reduction in Electricity Bill|
|Cost / Watt (installed)||$7.00|
|Federal Tax Incentive||$10,500|
|Payback period||14 years|
|New Av. Monthly Electric Bill||$22|
|Monthly Loan Payment||$130|
|NEW MONTHLY NET COST||$111|
* Tax savings will decrease as the principal is paid down. Please consult your tax preparer.
So if these savings look attractive to you then why not find out if solar will work for you. Fill out our free evaluation form and we will have a Hawaii solar expert will contact you.