Hawaii Solar Rebates and Incentives

Hawaii, land of volcanoes, waterfalls and immense beauty, is taking steps to become the most energy-independent state in the U.S. through an ambitious partnership with the Department of Energy (DOE). Under the partnership, DOE and Hawaii established the Hawaii Clean Energy Initiative. Through this and other incentives like tax credits, a new feed-in tariff, existing net-metering program, and low-interest loan programs, Hawaii is helping its residents make the transition to solar and its renewable cousins. The state also offers rebates for solar water systems.

Under the clean energy initiative, DOE will help Hawaii’s smaller islands transition to 100 percent renewables by 2030. Overall, Hawaii will attempt to drastically reduce its consumption of petroleum—by about 72 percent—and plans to have 40 percent of its energy coming from renewable resources like solar, wind, and ocean power by 2030.

The state still has a long way to go. As of 2010, 90 percent of the island state’s energy comes from petroleum, with three quarters of the state’s energy being generated by petroleum power-plants, according to the DOE’s Energy Information Administration. While coal powers most of the United States, transporting coal to Hawaii via ship, would likely be prohibitively expensive, compared to shipping oil to the state.

On the other hand, the state already is a leader in the nation when it comes to solar-water heaters. As of 2010 the state already had 80,000 solar water heaters installed. Most new homes in the state are required to have solar water heaters as well, thanks to the 2008 Solar Roofs Act.

Given Hawaii’s subtropical environment with mild year-round temperatures, energy use is lower in the state than in most other states. And because of its location in the Pacific, the state has vast potential for different types of renewable energy, including solar, geothermal (it is built on volcanoes after all), wind, and ocean power.
 

 

Solar Rebate and Incentive Programs

  • Hawaii Energy Tax Credits


    Program Type Tax Credit
    Technologies Photovoltaics, Solar Thermal Electric, Solar Water Heating, Solar Space Heating, Wind
    Amount Up to $5,000
    Required Documentation Proof of ownership
    Official Web Site http://www.hawaii.gov/dbedt/info/energy/renewable/solar

    Hawaii has offered this renewable energy state tax credit to residents and businesses since 1976, though the amounts and terms have changed over the years. The tax credit covers the year the system was purchased and installed. The credit is only available to the purchaser of the system. So, if a developer builds 10 homes and pays for photovoltaics (PV) or solar water on each, the developer is considered the purchaser and is eligible for the credits. But if the developer offers a system as an add-on, for which the buyer must pay extra, or if a homeowner contracts to have a system installed on their home, then they are the beneficiary of the credit.

    As of 2010, single family homes are eligible for a tax credit of 35 percent of the actual cost of the solar system and installation or $5,000 (whichever is less) for installing a PV or solar thermal energy system. Multi-family residential properties like condominiums or apartment buildings are eligible for a credit of 35 percent of the actual cost of the system and installation $350 per unit (whichever is less).


    Credits are given for each fully individual system with its own inverter, array, and connection to the site’s electrical system. So, if a homeowner has two fully independent PV arrays, each tied independently to the home’s electrical system, the system is eligible for two credits. Or if a homeowner’s farm has two separate systems installed, both would be eligible for the credit. The state recently clarified requirements because of credit abuse.

    The tax credit also is offered for solar hot water heating installations, though residential homeowners can only qualify for a credit of up to $2,250 or 35 percent of the cost of equipment and installation, whichever is less. Multi-family residences qualify for a credit of 35 percent of the cost of equipment and installation or $350 per unit, whichever is less.

  • Hawaii Net Metering


    Program Type Performance-based Incentives
    Technologies Photovoltaics, Solar Thermal Electric, Wind, Biomass, Hydroelectric
    Amount Up to 100 kW for most customers, 50 kW for some customers
    Required Documentation Net Energy Metering Agreement (with applicable utility)
    Official Web Site NA

    Hawaii is transitioning to a state-wide feed-in tariff performance-based incentive system for grid-tied solar and renewable generators. As of July 2010, no reimbursement rates have been specified for customer/generators. However, in 2008, an energy agreement was signed by Governor Linda Lingle, the Department of Business, Economic Development and Tourism, Hawaii’s electric companies (Hawaiian Electric Company, Hawaii Electric Light Company, and Maui Electric Company) and the Department of Commerce and Consumer Affairs.

    The new program will create the Clean Energy Infrastructure Surcharge, which will help finance a host of new initiatives, including providing bi-directional net meters to customer generators, like homeowners with grid-tied solar power installations. Under the energy agreement, reimbursement rates for customer/generators also will be determined, though at this point, the rates have not been set. Hawaii’s public utility commission will help determine what the appropriate rates will be.

    Under the current net-metering program, utilities provide customer generators with a bi-directional meter that allows the customer to feed electricity back into the grid. For excess net generation (more power made than used) the customers are given credits toward their next billing statement. However, at the end of a 12-month period, any electricity generated over the customer’s usage is credited to the utility unless a purchase agreement for excess generation was made with the provider.

    The net-metering program is offered on a first-come first-served basis, though none of the power companies have reached their limits of distributed generation at this point. Most utilities agreed to have up to 4 percent of their power come from distributed-generation sources like customer/generators. The net-metering program covers most systems up to 100 kW, but customer/generators of the Kau’i Island Utility Cooperative can only install systems up to 50 kW and still be enrolled in its net-metering program.

    To find out more, and to apply, customers must contact their individual power provider.

  • Hawaii Solar Hot Water Rebate


    Program Type Rebate 
    Technologies Solar Hot Water Heating
    Amount $750 instant rebate for residents
    Required Documentation Paperwork done by participating solar installer                                                                  
    Official Web Site http://www.hawaiienergy.com/solar

    These rebates are offered through the Hawaii Energy Efficiency Program, a public benefit fund administered by a third-party. The incentive is a one-time $750 rebate for residents and companies that install a solar water heating system on their building. The rebate is applied automatically by a participating contractor at time of sale. The program maintains a list of participating providers at its website.

    The rebate was instituted in 1996 and has helped more than 50,000 solar hot water systems get installed on the Hawaiian islands of Oahu, Maui, Lanai and Molokai. The program was managed by the utilities, but in July 2009, it was transferred to the Hawaii Energy Efficiency Program.

    Under the program, installers asses a site’s hot water needs, provide a bid for the complete installation, and tell property owners what their anticipated savings will be. The program contended that homeowners can save about $10 to $15 per month per person in energy costs by using a solar hot-water heater. After the system is installed, an inspector will come out to make sure it was installed properly.

  • Hawaii Solar Power Financial Incentives


    Financial Incentives

    Corporate Tax Credit

    Green Building Incentive

    Industry Recruitment/Support

    Local Loan Program

    Personal Tax Credit

    State Loan Program

    Utility Loan Program

    Utility Rebate Program



    Rules, Regulations & Policies

    Building Energy Code

    Contractor Licensing

    Energy Standards for Public Buildings

    Interconnection

    Net Metering

    Renewables Portfolio Standard

    Solar Access Law/Guideline




    Related Programs & Initiatives

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    The U.S. Department of Energy's Alternative Fuels and Advanced Vehicles Data Center (AFDC) provides a wide range of information and resources to enable the use of alternative fuels and other petroleum-reduction options, such as advanced vehicles, fuel blends, idle reduction and fuel economy. The AFDC site offers a database of state and federal laws and incentives related to alternative fuels and vehicles, air quality, fuel efficiency, and other transportation-related topics.



    Green Power Network
     

    The U.S. Department of Energy's Green Power Network provides news and information on green power markets and activities, including opportunities to buy green power. This site provides state-by-state information on green power marketing and utility green power programs. In addition, the site lists marketers of renewable energy credits (RECs), also known as green tags or renewable energy certificates, which represent the environmental attributes of the power produced from renewable energy projects.



    Weatherization Assistance Program
     

    The U.S. Department of Energy's Weatherization Assistance Program (WAP) enables low-income families to reduce their energy bills by making their homes more energy-efficient. Through this program, weatherization service providers install energy-efficiency measures in the homes of qualifying homeowners free of charge. The WAP program web site offers a state-by-state map of opportunities, projects and activities.



    Wind Powering America
     

    The U.S. Department of Energy's Wind Powering America site provides state-by-state information on wind projects and activities, including wind working groups, validated wind maps, anemometer loan programs, small wind guides, state-specific news, wind for schools, workshops and web casts.