Solar Financing in Hawaii
Lease vs. Buy vs. PPA — Complete financing guide for HI homeowners
Urgent tax credit deadlines
- Section 30D EV credit (up to $7,500) — expires June 30, 2026 (12 days left).
- Section 48E solar ITC safe harbor — construction must start by July 4, 2026 (16 days left).
Going solar in Hawaii? With electricity rates averaging 33.5¢/kWh and excellent solar resources, choosing the right financing option can save you $67,375 or more over 25 years. This guide breaks down every option available to Hawaii homeowners.
Avg Rate
33.5¢
per kWh
Solar Resource
Excellent
HI
Typical System
7kW
residential
Payback
~4.5 yrs
estimated
Solar Incentives & Tax Credits in Hawaii
Hawaii homeowners can take advantage of the following solar incentive programs:
Federal Solar Investment Tax Credit
30% federal tax credit via Section 48E for qualifying projects (leases, PPAs, commercial) that begin construction before July 4, 2026. The residential ownership credit (25D) expired December 31, 2025.
30% of system cost
Hawaii Solar Tax Credit
Hawaii offers a state income tax credit of 35% of system cost (20% for property used in business), capped at $5,000 for residential systems.
35% up to $5,000
Solar Property Tax Exemption
Solar energy systems are exempt from property tax on the added value by county ordinance.
100% property tax exemption
Hawaiian Energy Battery Bonus
Hawaiian Electric's Battery Bonus program provides an upfront incentive for adding battery storage to rooftop solar.
$850/kW battery
Net Metering in Hawaii
Hawaii ended traditional net metering in 2015. Customers can enroll in Customer Grid-Supply (CGS) or Customer Self-Supply (CSS) programs with reduced export credits, making self-consumption and batteries essential.
✓ Hawaii offers a property tax exemption for solar installations, meaning your property taxes won't increase despite the added home value.
Compare Financing Options in Hawaii
See how cash purchase, solar loan, lease, and PPA compare based on Hawaii's average rates:
Solar Financing Comparison for Hawaii
Based on 33.5¢/kWh electricity rate and a 7kW system
Cash Purchase
Pay upfront — maximum long-term savings
- Upfront Cost
- $14,700
- Monthly Savings
- $274/mo
- Tax Credit Eligible
- Yes
Solar Loan
$0 down — own the system over time
- Down Payment
- $0
- Monthly Payment
- $144/mo
- Net Monthly
- $130/mo
- Tax Credit Eligible
- Yes
Solar Lease
$0 down — provider owns the system
- Down Payment
- $0
- Monthly Payment
- $91/mo
- Net Monthly
- $183/mo
- Tax Credit Eligible
- No
Power Purchase Agreement
$0 down — pay per kWh produced
- Down Payment
- $0
- Annual Savings
- $2,744/yr
- Tax Credit Eligible
- No
Estimates based on average Hawaii (HI) rates and system costs. For a personalized comparison, use our full financing calculator.
Lease vs. Buy vs. PPA in Hawaii
Buying (Cash or Loan)
Best for: Maximizing long-term savings and home value.
- You own the system and all electricity it generates
- Eligible for the 30% Federal Tax Credit (~$6,300 on a 7kW system)
- Property tax exempt in Hawaii
- Increases home value by an average of 4.1%
- Highest 25-year savings: ~$67,375
- You handle maintenance (panels need little)
Solar Lease
Best for: Zero upfront cost with predictable payments.
- $0 or low upfront cost
- Fixed monthly payment (no surprise bills)
- Maintenance and repairs typically covered
- Not eligible for tax credits or incentives
- Lower 25-year savings (~$54,775)
- May complicate home sale (lease transfer)
Power Purchase Agreement (PPA)
Best for: Paying only for what you produce, $0 down.
- $0 upfront cost
- Pay a per-kWh rate (typically lower than utility)
- Provider owns and maintains the system
- Not eligible for tax credits
- Rate escalates 2-3% annually (read the contract)
- Lowest 25-year savings of the three options
Solar Financing FAQ — Hawaii
Is solar worth it in Hawaii?
Yes, solar is an exceptionally strong investment in Hawaii. With among the highest electricity rates in the nation averaging 33.5¢/kWh and excellent solar resources, a typical 7kW system can offset most of your household electricity usage. The estimated payback period is 4-6 years, after which you enjoy more than a decade of largely free electricity. hawaii ended traditional net metering in 2015 is the main policy factor to verify with your utility.
What solar incentives are available in Hawaii?
Hawaii residents can claim the 30% Federal Solar Investment Tax Credit (worth $6,300 on a typical 7kW system). The state also offers Hawaii Solar Tax Credit, Solar Property Tax Exemption, Hawaiian Energy Battery Bonus. Hawaii offers a property tax exemption, so your property taxes won't rise despite the added home value.
Should I lease, buy, or get a PPA in Hawaii?
Buying your solar system (cash or loan) maximizes long-term savings and qualifies you for the 30% Federal Tax Credit. On a typical 7kW system in Hawaii, that's about $6,300 back. Buying yields roughly $67,375 in net savings over 25 years. Leasing or a PPA requires $0 down and includes maintenance, but you won't get tax credits and your 25-year savings will be much lower (around $54,775). If you can afford the upfront cost or qualify for a low-rate loan, buying is the clear winner in Hawaii.
How much does a solar system cost in Hawaii?
A typical 7kW residential solar system in Hawaii costs approximately $21,000 before incentives. After the 30% Federal Tax Credit (~$6,300), the net cost drops to about $14,700. Actual costs vary based on equipment quality, installer, roof complexity, and whether you add battery storage. Hawaii offers a property tax exemption, so your property taxes won't rise despite the added home value.
Does Hawaii have net metering?
Hawaii ended traditional net metering in 2015. Customers can enroll in Customer Grid-Supply (CGS) or Customer Self-Supply (CSS) programs with reduced export credits, making self-consumption and batteries essential.
What is the solar payback period in Hawaii?
The typical solar payback period in Hawaii is approximately 4-6 years. With a net system cost of about $14,700 after the federal tax credit and annual electricity savings of roughly $2,955-$3,611 (based on 33.5¢/kWh), most Hawaii homeowners see full payback within 6 years and enjoy 19+ years of largely free electricity thereafter.
Related Solar Tools
Estimates are based on Hawaii average rates, system costs, and the 30% Federal Solar Investment Tax Credit. Actual savings vary by installer, equipment, roof, and utility policy.