Hawaii has ideal conditions for solar energy with very high prices for electricity, very few fossil fuels and a terrific climate for solar insolation. Because of this, Hawaii has more solar energy companies and start-ups focusing on installing solar panels than anywhere else in the United States. Recently, however, the utility companies have slowed the pace of actual implantation. Find out more about the state of solar in Hawaii, and what the future of the industry looks like in the state.

Hawaii’s Solar
Report Card

Grade
Methodology

To determine a grade for each state, our researchers and solar experts analyzed data on crucial solar-advancement criteria from the following sources:

We determined a rank from 1 to 10 for each state in each category. We then combined the scores with the following weights and assigned an overall grade for each state. Our goal is to encourage those considering solar for their homes to get a basic understanding of solar potential in their areas and discover the best opportunities for clean energy available.

Incentives & Rebates, 40%

Electricity Rate, 15%

Renewable Energy Policy, 30%

Interconnection Ease, 5%

Photovoltaic Potential, 10%

The Cost of Electricity in Hawaii

The cost of traditional energy sources in Hawaii is very high because of the state’s lack of natural resources. In fact, the state has the highest costs for electricity in the country but one of the lowest consumption levels due to its mild climate. The average cost of energy in Hawaii is $.26/kWh, more than twice the national average. This high cost of electricity has helped bolster the drive to go solar.

Cost of Residential Electricity

Data from U.S. Energy Information Administration
*as of Q3 2015

Hawaii
Library of Resources

Solar Policies & Incentives in Hawaii

Hawaii’s legislature developed its renewable portfolio standard (RPS) to require 40 percent of the state’s electricity come from renewable sources by 2030 and 100 percent by 2045. This made Hawaii the first state to target the 100 percent mark. It plans to accomplish this with a mix of small residential and commercial installations and several larger corporate projects. Because the cost of non-renewable energy is so high in Hawaii, even with few incentives a consumer installing a solar system will reap a great financial reward in savings alone.

REBATES/INCENTIVES

Feed-in Tariff

The three investor-owned utilities offer a performance-based feed-in tariff. The rates for solar photovoltaic systems less than 20 kW is $0.219/kWh, $0.189 for systems larger than 20 kW but less than 500 kW, and $0.197/kWh for greater than 500 kW but less than 5 MW.

City and County of Honolulu – Solar Loan Program

Income-eligible homeowners who wish to install solar photovoltaic systems can take advantage of zero-interest loans through Honolulu’s Rehabilitation Loan Program. The loans, for low- and moderate-income owner-occupants, can include additional repairs such as reroofing work. For loans more than $10,000, a mortgage lien will be used.

None for commercial specifically

POLICIES

Renewable Portfolio Standard

Hawaii’s RPS requires that 40 percent of each utility’s net electricity sales be from renewable resources by 2030 and that 100 percent be from renewable resources by 2045. There is no specific solar carve-out.

Solar Contractor Licensing

Hawaii offers licenses specifically for solar contractors, including Solar Power Systems, Solar Energy Systems and Solar Heating and Cooling Systems. Each license requires four years of experience plus exams. For PV systems, a licensed electrician must certify the system and its connections.

Interconnection Standards

Hawaii has simplified interconnection rules for small inverter-based systems by using one application process for systems under 10 kW on islands other than Kauai. For other systems up to 50 kW on Kauai and 100 kW on other islands, there are additional interconnection and net-metering procedures.

Net Metering

In October 2015, the Hawaii PUC voted to end net metering and replace it with three options: grid supply, self-supply and time-of-use tariff. Those plans are under review. Customers who already have net metering will be able to continue. Currently, unused excess generation credits revert back to the utility.

Property Permit Processing

County agencies that issue building permits are required to give priority processing to projects using environmental design building standards, including solar photovoltaics.

Solar Rights

Hawaii prohibits restrictions on the installation or use of a solar energy system on a residence. Homeowners associations’ rules must allow for the placement of systems and cannot cause the system’s placement to make it more than 25 percent less effective or increase the cost of installation or maintenance.

None for commercial specifically

TAX CREDITS

Solar Energy Credit

Individuals and corporations with solar photovoltaic systems are allowed to claim an income tax credit of 35 percent of the cost of equipment and installation of a system. Single-family residences can qualify for 35 percent or up to $5,000, whichever is less. Multi-family residential property can qualify for 35 percent or up to $350 per unit. Commercial property can be eligible for up to $500,000 or 35 percent, whichever is less.

None for residential specifically

None for commercial specifically

TAX EXEMPTIONS

City and County of Honolulu – Real Property Tax Exemption for Alternative Energy Improvements

Alternative energy improvements, including solar photovoltaic systems, qualify homeowners and business owners for a property tax exemption for 25 years.

None for residential specifically

None for commercial specifically

Solar Companies, Contractors & Installers

Hawaii is home to a number of solar companies. Following is just a sampling of what’s available:

Affordable Solar Contracting

Affordable Solar Contracting was established to provide quality and affordable solar systems available to everyone in Hawaii in an effort to reduce greenhouse gases and reach energy independence.

Where it operatesWahaiwa

Year of opening2010

Alternate Energy

This company designs and installs solar products and is one of the oldest solar providers in the state. Customers include both residential and commercial.

Where it operatesHonolulu

Year of opening1993

Bonterra Solar

Since its start Bonterra Solar has provided clean, reliable and renewable energy to both residential and commercial Hawaiian clients. The company built the first net-zero energy housing community in the country and is the exclusive solar contractors for new Gentry Homes.

Where it operatesHonolulu

Year of opening2009

Brown’s Plumbing and Solar

This company provides products and service for solar systems.

Where it operatesHonolulu

Year of opening2002

C&J Solar Systems

Founded by a mother and son, C&J Solar provides solar thermal and solar electric products and services to Hawaii.

Where it operatesKaneohe

Year of opening1999

Green Power Projects, LLC

Developed by Alan Leonard to serve the renewable energy needs of Hawaiians.

Where it operatesHaleiwa

Year of opening1992

Haleakala Solar

Founded by a plumber with a vision of the future, Haleakala Solar is a leader in the solar industry in Hawaii. It assists customers with financing and tax credits as well as design and installation of the solar systems.

Where it operatesHonolulu

Year of opening1977

Lumen Solar

Lumen is a part of the May Global Business Group family. They provide PV panels and roof tiles, along with solar water systems and solar lighting.

Where it operatesHonolulu

Year of opening2010

Rising Sun Solar

Rising Sun provides net-metered PV solar systems and promotes energy independence, stewardship of the environment and sustainable energy.

Where it operatesHaiku

Year of opening2003

Twentieth Century Technologies

Green Solutions Hawaii, a division of Twentieth Century Technologies was established to educate Hawaiians on the benefits and details of residential solar energy usage. Its mission is to provide the best renewable energy systems and products, to offer consumers honest appraisals of green building products and inform the public of the advantages of renewable energy for Hawaii.

Where it operatesHonolulu

Year of opening2008

Hawaii Solar Panel Resources

If you are looking for more information on solar industries and the benefits of going solar, check out these sites:

DSIRE Incentives Database – Hawaii

This site is a public clearinghouse providing information on incentives for solar energy systems in Hawaii and throughout the mainland.

Hawaii Public Utilities Commission

This commission controls all aspects of Hawaii’s energy program including rates the utilities can charge.

Hawaii Solar Energy Association

This site has covered the activities of local solar companies and the creation of solar jobs in Hawaii since 1977.

Hawaii State Legislature

Learn what your legislature is doing to increase the use of solar and other renewable energy with incentives and laws.

State Energy Office

This site offers information about state programs and policies on energy consumption, strategies and statistics.

U.S. Energy Information Administration – Hawaii State Profile

This U.S. government site offers data and information on energy usage in Hawaii.