Solar Incentives in Hawaii
Hawaii homeowners considering solar in 2026 have access to several active incentive programs. The state's Renewable Energy Technologies Income Tax Credit (RETITC), administered by the Hawaii Department of Taxation, provides a state income tax credit equal to 35% of actual installed cost for eligible solar electric and solar water heating systems, subject to per-system caps — for single-family residential solar electric installations the cap is $5,000 per system. Hawaiian Electric customers can enroll in the Smart Renewable Energy program, which provides bill credits for energy exported to the grid at time-differentiated rates approved by the Public Utilities Commission; these export rates are not equivalent to full retail net metering, and applicable rates vary. Hawaiian Electric also offers the Bring Your Own Device (BYOD) and BYOD Plus programs, which provide a one-time cash incentive and ongoing bill credits for battery storage systems that export during defined evening peak hours. Customers unable to install rooftop panels — including renters and apartment residents — may subscribe to the Community-Based Renewable Energy (CBRE) Shared Solar program and receive bill credits for a share of an off-site project's output. On Oahu, the City and County of Honolulu exempts the added assessed value of qualifying solar improvements from real property taxation; other counties administer property taxes separately and should be consulted individually.
The federal residential Clean Energy Credit under Internal Revenue Code §25D — commonly known as the 30% federal tax credit — expired for systems placed in service after December 31, 2025, under the One Big Beautiful Budget Act (Pub. L. 119-21). New residential solar installations completed in 2026 do not qualify for that credit. This is a meaningful change to the financial calculation for new buyers, as the federal credit had previously offset a substantial share of system costs, and its absence lengthens the expected payback period compared to prior years.
Hawaii's residential electricity rate averaged approximately 42.23 cents per kilowatt-hour as of March 2026 — among the highest in the nation and up about 1.12 cents year-on-year. High electricity costs have historically improved the economics of solar self-consumption in Hawaii, since each kilowatt-hour produced and used on-site offsets power that would otherwise be purchased at that elevated rate. Even without the federal credit, this rate environment remains a significant factor in payback calculations, though actual outcomes depend on system size, export credits received, financing terms, and individual usage patterns.
Figures here are verified as of June 2026 against official sources; programs, caps, rates, and eligibility rules change with each legislative session and utility rate case. The Hawaii Public Utilities Commission, Hawaii Department of Taxation, and each county's real property assessment division are
Federal credit update. The federal residential Clean Energy Credit (the 30% “solar tax credit” under §25D) expired for systems placed in service after December 31, 2025. New 2026 residential installs do not qualify; a 2025 install can still be claimed on a 2025 return (IRS Form 5695). What this means for 2026 →
Current solar incentives in Hawaii
Renewable Energy Technologies Income Tax Credit (RETITC)
Hawaii offers a state income tax credit for installing eligible renewable energy systems, including photovoltaic (solar electric) and solar water heating. For solar energy systems the credit equals 35% of the actual installed cost or a per-system cap, whichever is less. Caps differ by system type and property type. For solar electric systems on single-family residential property, the system must have a total output capacity of at least 5 kW to qualify. A taxpayer may elect to reduce a solar credit by 30% in exchange for the credit being refundable.
| Amount | Solar energy systems: 35% of actual cost, capped at $5,000 per system for single-family residential property (lower caps for multi-family and commercial). Solar water heating: 35% of cost, capped at $2,250 per system for single-family residential ($350 per unit for multi-family). Wind systems: 20% of cost, capped at $1,500 per system for single-family residential. Solar electric systems on single-family homes must be at least 5 kW total output capacity. |
|---|---|
| Who qualifies | Hawaii taxpayers who install and place in service an eligible solar or wind energy system at property in the state during the tax year; the credit may be claimed per eligible system, with multiple owners apportioning a single credit by cost contribution. |
| Administered by | Hawaii Department of Taxation |
Source: Hawaii Revised Statutes (HRS) § 235-12.5; Form N-342 Official source →
Smart Renewable Energy Export Program
Hawaii's traditional retail net energy metering (NEM) closed to new applicants in 2015, and successor export programs (Customer Grid-Supply, Customer Grid-Supply Plus, Smart Export) have also closed. The current program for new rooftop solar customers in Hawaiian Electric's service area is Smart Renewable Energy, whose Smart DER tariff began April 1, 2024. Under the Smart Renewable Energy Export track, customers receive bill credits for electricity their system exports to the grid at commission-set export rates rather than full retail net metering. The program is open to all renewable technologies with no project size limit, requires an advanced meter, and export rates are updated every three years.
| Amount | Bill credit for exported energy at PUC-approved export rates (time-differentiated; not full retail net metering); export rates reviewed and updated every three years. Existing CGS, CGS Plus, and Smart Export customers transition to the Smart Renewable Energy Export track no later than seven years after their original agreement (transitions began Oct. 1, 2024). |
|---|---|
| Who qualifies | New rooftop solar customers of Hawaiian Electric (Oahu, Maui County, Hawaii Island) who interconnect distributed generation and install an advanced (smart) meter; legacy NEM and NEM Plus customers are not required to transition. |
| Administered by | Hawaiian Electric (under Hawaii Public Utilities Commission rules) |
Source: Hawaiian Electric Smart Renewable Energy / Smart DER tariff; Hawaii PUC DER program dockets Official source →
Bring Your Own Device / BYOD Plus (battery storage incentive)
Hawaiian Electric's Bring Your Own Device (BYOD) program, with BYOD Plus available since May 15, 2025, gives customers who add battery energy storage to a new or existing rooftop solar system a one-time cash incentive plus bill credits for exporting stored energy to the grid, especially during the evening peak (5 p.m.-9 p.m.). BYOD replaced the earlier Battery Bonus program, which closed to new participants on July 1, 2024 (with final documentation no longer accepted after September 30, 2025).
| Amount | One-time cash incentive plus ongoing bill credits for battery export during defined peak periods; specific incentive levels are set by the program tariff and vary by island and program track. |
|---|---|
| Who qualifies | Hawaiian Electric customers adding qualifying battery energy storage to a new or existing rooftop solar system; participants enroll a controllable battery device. |
| Administered by | Hawaiian Electric (under Hawaii Public Utilities Commission rules) |
Source: Hawaiian Electric BYOD / BYOD Plus and Battery Bonus program pages; Hawaii PUC DER dockets Official source →
Community-Based Renewable Energy (CBRE) / Shared Solar
Hawaii's Community-Based Renewable Energy program, branded by Hawaiian Electric as Shared Solar, lets customers who cannot install their own rooftop system, such as renters and apartment residents, subscribe to a share of an off-site renewable project and receive bill credits. CBRE Phase 2 (Shared Solar) is open to photovoltaic projects with or without batteries, with projects coming online in 2025 and 2026. The PUC framework targets a guaranteed bill discount of at least 10% for participation. Customers enroll through the community energy portal.
| Amount | Subscribers receive bill credits for their share of project generation; PUC guidance targets at least a 10% bill discount for CBRE participants. Specific credit and subscription terms are set per project. |
|---|---|
| Who qualifies | Hawaiian Electric customers, including renters, apartment residents, and small commercial customers, who subscribe to a registered CBRE/Shared Solar project; no on-site installation required. |
| Administered by | Hawaii Public Utilities Commission (program design); Hawaiian Electric (administration) |
Source: Hawaii PUC Community-Based Renewable Energy docket; Hawaiian Electric Shared Solar program Official source →
City and County of Honolulu Alternative Energy Improvements Property Tax Exemption
Property taxes in Hawaii are administered by the four counties, not the state. The City and County of Honolulu (Oahu, the state's most populous county) exempts the value of qualifying alternative energy improvements, including solar energy systems, from real property assessment under its Real Property Assessment Division exemption program. The exemption keeps a home's assessed value from rising due to the added solar installation. An exemption claim must be filed with the Real Property Assessment Division.
| Amount | Exempts the added assessed value attributable to qualifying alternative energy (including solar) improvements from Honolulu real property tax; exemption applies for the period set by the ordinance. |
|---|---|
| Who qualifies | Owners of real property in the City and County of Honolulu with qualifying alternative energy improvements (including solar) who file an exemption claim with the Real Property Assessment Division. Other Hawaii counties administer their own property tax treatment. |
| Administered by | City and County of Honolulu, Real Property Assessment Division |
Source: Revised Ordinances of Honolulu (ROH) ch. 8, art. 10 (Alternate Energy Improvements Exemption) Official source →
Compare solar incentives across all states → · Check what applies to you →
Programs verified as of June 2026 against official state and federal sources (each cited above); refreshed quarterly as legislatures and utility rate cases change the rules. How we verify this data. This page is informational only — not tax or legal advice.