If you’ve been thinking about switching to solar power in Hawaii, 2025 is one of the best years yet to make the move. With some of the highest electricity rates in the country, generous state and federal tax credits, and new utility programs, homeowners can cut the cost of solar dramatically.
Here’s your complete guide to all the Hawaii solar incentives and rebates available in 2025 — and how to take full advantage of them.
Why Incentives Matter in Hawaii
The average Hawaiian household spends nearly three times the national average on electricity. Incentives don’t just help you save money upfront — they shorten your payback period so you can start profiting from your solar investment sooner.
Federal Solar Tax Credit (ITC)
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Value: 30% of the total cost of your solar system
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Eligible: Both residential and commercial systems
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Applies To: Panels, inverters, racking, labor, permitting, and battery storage
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Expires: Current 30% rate is locked in until 2032
Example: If your system costs $30,000, you could get a $9,000 federal tax credit.
Hawaii State Solar Tax Credit
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Value: 35% of your total system cost (capped at $5,000 per system)
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Eligible: Solar electric (PV) and solar hot water systems
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Bonus: Can be used alongside the federal tax credit
Example: On that same $30,000 system, you could save another $5,000 from the state credit — bringing your total tax savings to $14,000 before rebates.
HECO Battery Bonus Program (2025 Update)
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Purpose: Encourages homeowners to add battery storage to help stabilize the grid
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Incentive: One-time upfront payment + monthly bill credits for 10 years
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Eligibility: Must connect your battery to discharge during evening peak hours
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Perfect Pairing: Works well with Tesla Powerwall and Enphase batteries
Solar Water Heating Incentives
Hawaii Energy offers rebates for solar water heating installations:
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$1,500 upfront rebate for replacing an electric water heater
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Extra rebates for low-income households
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Lower electricity use for heating water, which is a major energy cost in Hawaii
How to Maximize Your Incentives
To get the biggest savings:
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Install before rate or program changes — incentives can change annually
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Pair solar with battery storage for HECO bonus payouts
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Work with a local installer who handles all tax credit paperwork
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Consider solar hot water in addition to PV for extra rebates
FAQs About Hawaii Solar Incentives
Do these incentives apply to Tesla Solar Roofs?admin2025-09-05T19:18:25+00:00
Yes — Tesla Solar Roofs qualify for both federal and state solar tax credits.
Are solar incentives in Hawaii taxable?admin2025-09-05T19:18:05+00:00
Tax credits reduce your tax liability; rebates may be taxable income — check with your tax professional.
Can I claim both state and federal tax credits?admin2025-09-05T19:17:44+00:00
Yes — most homeowners qualify for both, significantly reducing your costs.
Why 2025 is the Time to Go Solar in Hawaii
Between state and federal tax credits, HECO’s battery bonus, and high electric rates, many homeowners are seeing ROI in 4–6 years. After that, your system is generating free energy for decades.
HI Power Solar specializes in maximizing incentives for Oahu homeowners. We’ll design a system that fits your needs, process all your rebate paperwork, and ensure you get every dollar you qualify for.
