Hawaii solar rebates and incentives: 2025 guide

Hawaiians looking to power their homes with clean, sustainable energy have access to a few cost-cutting solar incentives that can help speed up their payback period. Between the state’s income tax credit and the federal solar tax credit, you can save thousands on your solar panel system. 

As a Hawaii homeowner, you have access to some great incentives that can substantially improve your return on investing in solar panels. The tax credits below are some of the most impactful ways to bring down your solar costs.

Residential Clean Energy Credit

The Residential Clean Energy Credit, formerly known as the federal investment tax credit (ITC), can reduce your solar panel system's cost by 30%. Your entire system qualifies for this incentive, including equipment, labor, permitting, and sales tax. 

When you file your federal income taxes, you can claim this incentive as a credit towards your federal tax bill. Just keep in mind that to qualify for the ITC, you need to purchase your system either with cash or a solar loan–if you lease your system, you won't be eligible. 

You also need a high enough tax bill, though you can roll over any remaining credit year-to-year until 2035 when the ITC expires. The only time you might be eligible for a direct payment for the ITC is if you're a tax-exempt entity, like a nonprofit organization.

Renewable Energy Technologies Income Tax Credit (RETITC)

The Renewable Energy Technologies Income Tax Credit (RETITC) is a state tax credit worth 35% of your solar panel system's cost, up to $5,000.

If you don't have enough state income tax liability to claim the full tax credit, you can roll over any remaining credit indefinitely. You can also elect to reduce your tax credit amount by 30% and get a refund for any credit that exceeds your tax liability in the first year. 

Green Energy Money $aver (GEM$) On-Bill Program

The Green Energy Money $aver (GEM$) On-Bill Program provides financing for homeowners and renters looking to purchase a solar panel system. Offered through the Hawai‘i Green Infrastructure Authority, a green bank, the GEM$ On-Bill Program doesn’t require credit checks or income verification. GEM$ loans come at a fixed rate of 5.5% with terms of up to 25 years. 

In November 2024, the Hawai’i Green Infrastructure Authority paused accepting new applications. They haven’t said yet when they’ll begin accepting new applications again, though it will be via a new application portal. Until then, keep checking here for updates.

Hawaii doesn’t offer any statewide solar tax exemptions. 

But the city and county of Honolulu does have a real property tax exemption for alternative energy improvements, which includes solar panels, as well as wind, hydropower, tidal, wave, and solid waste projects. If you live and install a solar panel system in Honolulu, this means your system won’t be assess and result in higher property taxes.

Hawaii no longer offers net metering, but Hawaiian Electric does offer a form of net billing on every island, which they call Smart Renewable Energy Export.

While the sun is shining, your solar panels might produce more electricity than your home needs at any given moment. Under the net billing (AKA Smart Renewable Energy Export) program in Hawaii, you can sell that excess power back to the grid for credits on your electricity bill. 

The catch is that the utility companies only offer partial credit for every kWh—you’re selling the electricity to them at a significant discount, compared to what they’ll charge you to buy that electricity back later. 

The exact rates depend on the island and the time of day, but it’s generally a fraction of the retail rate. These are the Smart Renewable Energy Export rates for 2024–2026:

There are a few more nuances to be aware of: 

• The credits you earn don’t apply to fixed charges on your monthly electric bill. 

• Credits roll over month to month but, unlike with net metering, they expire at the end of a 12-month period (your true up date). 

• Export rates are updated every three years. But when you install your solar panel system, your export rates are locked in from the time of installation for the next seven years.

If you want to squeeze the most possible value out of your solar panels under net billing, consider installing a solar battery.

All batteries above 3 kWh are eligible for the 30% federal tax credit. Hawaii does offer another battery storage incentive program—the Bring Your Own Device (BYOD) Program—but it’s not really worth enrolling in. 

The BYOD Program’s predecessor, the Battery Bonus Program, played a huge role in lowering the state’s grid demand and boosting renewable generation in 2022 and 2023. Unfortunately, you won’t be able to take advantage of those favorable rates as a new applicant. Under the Battery Bonus Program, you could earn $850 per kilowatt (kW) of storage upfront. Now, you’ll be compensated $100 per kW with a $500 maximum. 

The new program is extremely complicated and requires you to sign up for a new time-of-use (TOU) electricity rate plan to be eligible. Every time you supply electricity to the grid, you'll actually lose money under the BYOD program. Pairing energy storage with your solar panels can still boost energy independence and provide backup power during an outage. But you might be better off forgoing the BYOD Program and keeping that stored energy for yourself.