Hawaii Solar Incentives & Rebates Guide 2026

The federal Investment Tax Credit (ITC) allows Hawaii homeowners to deduct 30% of the total cost of a solar energy system from their federal income taxes. For a typical 6kW system costing $18,060 in Hawaii, that's a direct tax credit of $5,418. This isn't a deduction — it's a dollar-for-dollar reduction of your tax bill.

The 30% ITC is available through 2032 under the Inflation Reduction Act, then steps down to 26% in 2033 and 22% in 2034. There's no maximum cap on the residential credit. If your tax liability is less than the credit amount, you can roll the remaining credit forward to the next tax year. The system must be installed on your primary or secondary residence, and you must own it (leased systems don't qualify for the homeowner credit).

In addition to the federal ITC, Hawaii offers its own state solar tax credit: 35% of costs, up to $5,000. This state credit can be claimed alongside the federal credit, stacking your total tax savings. For a 6kW system, the Hawaii state credit saves you approximately $5,000.

Combined with the federal ITC, your total tax credits amount to $10,418 — reducing your net system cost to just $7,642. That's a 58% reduction from the gross cost.

Great news for Hawaii homeowners: Solar energy systems are exempt from property tax assessments. Honolulu only; 20-year exemption Studies show solar adds 3-4% to home values. For a $300,000 home, that's roughly $12,000 in added value — and with Hawaii's property tax exemption, you save approximately $132 per year in property taxes you'd otherwise owe on that increased value.

Hawaii does not currently exempt solar equipment from state sales tax. This means you'll pay the applicable sales tax on your solar system purchase. However, the 30% federal ITC and other available incentives more than compensate for this cost in most cases.

Net metering policy: Net Billing (Reduced Rate). Net metering eliminated 2015; replaced by Customer Grid Supply (CGS) and Customer Self Supply (CSS) programs

Under Hawaii's net billing policy, excess solar energy sent to the grid is credited at a rate lower than the retail price. This means it's important to maximize self-consumption — use major appliances during peak solar hours and consider adding battery storage to capture excess generation for evening use.

Hawaii has a mandatory Renewable Portfolio Standard (RPS) target of 100% renewable by 2045. This legally binding target drives continued investment in renewable energy infrastructure and often supports solar-friendly policies like net metering and SREC programs. A strong RPS is generally good news for solar homeowners, as it creates market demand for renewable energy and helps maintain favorable solar policies.