Hawaii’s Solar Power: Solar Tax Credits & Incentives

Known for its beautiful and tropical environments, Hawaii is a place that many people aspire to visit or live. With warm weather, clear waters and a beachside that is just astounding. These group of islands are the envy of many a vacationer and tourist. It is a popular tourist destination, one that has thousands of visitors every year, especially during the summer months.

But did you know that there is more to the state than its tropical beauty and amicable weather? What really makes Hawaii great is its use of energy. To be more specific, it is its use of solar energy.

Hawaii is one of the states that have adopted the usage of solar energy. Known for its stellar solar resources, solar power is a resource that is steadily and readily available to the people of Hawaii. The state has a portfolio standard of over 40% renewable energy by the year 2030, and that will more than double by the year 2045.

But why the shift in energy you may ask? Well, the answer lies with a variety of reasons but none that are more important than two: cost, and resource. There is a high cost of electricity throughout the country and despite its distance from the mainland. Hawaii is no stranger to the problem. In fact, the problem may even be more expensive for them as their imported energy costs which include electricity, petroleum and coal are up to 3-4 times higher than that of the mainland’s. There is also the manner of resource since due to its geographical location and tropical climate, Hawaii has a vast amount of solar power that can be converted into renewable energy.

This has led into a surge of solar energy distributed throughout the Hawaiian Islands, with solar power being available to many homes and businesses in the state. In fact, over 17% of Hawaii’s energy is based purely on solar power and with their current projections, that number will only continue to grow throughout the years. So, with this sudden resurgence in solar energy, you would think that such a resource would be readily and freely available to the people. In which case, you would be half-correct.

Half-correct I say, because like with other sources of energy, solar energy is not without cost. Though Hawaii wants its citizens to adapt to its use, there still must be a tax placed on any form of power. However, unlike most taxes, this one can be used in your favor. The tax that I speak of is something called the solar tax credit.

What is the Solar Tax Credit?

The solar tax credit is a form of tax within your energy costs that acts as a credit. A credit which can be put into use in the form of a 30% discount to your federal tax bills. This can lead to savings of up to $6,000 (Keep in mind that this will decrease to 26% by the year 2033)

This credit is increased in the state of Hawaii, as its citizens can have a solar tax credit of up to 35% on their annual federal taxes. The government wishes to make use of its natural resources and wants its citizens to do just the same which is translated into the solar tax credit. This credit includes everything to do with the people’s solar use, from solar panel installations to hardware and labor costs. To claim solar tax credit, you need only list anything related to solar energy costs on your taxes. This will also include invoices and proof of contracts to the solar company that provides you and your home. Learn more about solar tax credits and incentives

Incentives of the Solar Tax Credit

Besides the 30-35% credit on your annual federal taxes, there are other incentives as well to invest in the use of solar energy. These come in the form of other discounts for solar powered devices such as solar water heaters or solar batteries.

Conclusion

Hawaii is a land abound with beauty and wonder from tropical sceneries, comfortable weather and a people that’s welcoming to natives and tourists alike. Ensuring such a place remains that way should be an endeavor that all who live there should strive to uphold.

The use of solar energy is slowly but surely becoming a prevalent subject in the world’s economy, and such is no more the case than in the Aloha state itself. With the solar tax credit and incentives to entice its residents to use solar power, solar energy will one day become one of the main sources of our world’s energy and power and a renewable source at that. It is better now rather than later, to make use of its resources and uses while we still can. It’s better for the world, and in turn, better for us.

For more information on solar power, click here