JAMM AQUINO / JAQUINO@STARADVERTISER.COM
A general view of some of thousands of solar panels.
The Hawaii Solar Energy Association called for the Legislature to reconvene on an emergency basis after lawmakers passed a bill industry officials say would retroactively impact 2026 solar tax breaks.
The Hawaii Solar Energy Association called for the Legislature to reconvene on an emergency basis after lawmakers passed a bill industry officials say would retroactively impact 2026 solar tax breaks.
Senate Bill 3125 limits and phases out state income tax credits for consumers and businesses installing rooftop solar systems — a bill the association adamantly opposed.
The bill sets income limits of $175,000 for individual filers and $350,000 for joint filers to receive renewable energy technology tax credits, which would retroactively apply to this tax year. The bill also sets a $40 million cap on total tax credits given out by the state, though that won’t go into effect until 2027.
By 2031, according to SB 3125, the state would no longer reimburse consumers for installing renewable energy technology.
“Hawaii families and businesses installed solar this year under the law as it stood, with signed contracts and capital already deployed,” Rocky Mould, the associations’s executive director, said in a news release. “Changing the rules retroactively is not tax policy — it is breaking faith with people who did exactly what the state asked them to do.”
SB 3125’s aims to preserve state income tax cuts for 80% of Hawaii taxpayers that are scheduled to take effect in annual steps through 2031. The phased repeal of the renewable energy tax credit program and six other industry tax credits are needed to afford the broad income tax relief and other spending in the state budget in the midst of expected federal funding losses for programs including the Supplemental Nutrition Assistance Program and Medicaid that state leaders have vowed to support.
The renewable energy tax credits, which can be up to $5,000 per residential rooftop system, cost the state about $100 million annually in recent years, though the elimination of a 30% federal tax credit at the end of last year has reduced business this year by about 30%, according to the Hawaii Solar Energy Association.
The industry group claims losing state tax credits jeopardizes the ability of commercial-scale projects to “safe harbor” federal tax credits they factored into their financing.
“The affected projects have been years in the making and include many serving low-income housing, government facilities, healthcare facilities, schools, and other community spaces,” the association said. “Without legislative action, many of these projects may have to be canceled.”
The group claims the renewable energy tax credit was “one of few proven tools that delivers permanent, structural relief” from Hawaii’s high cost of living for working families.
“Eliminating the credit, especially retroactively, does not provide relief to working families,” the association said. “It removes one of the most effective tools available to help them lower their energy costs and compounds the harm already caused by the federal rollback of clean energy tax credits earlier this year.”
The trade group believes the Legislature should call a special session to adopt language that would protect projects already built or contracted this year. The group also said it is evaluating all available options, “including legal avenues,” to address the issue.
In order to call a special session, two-thirds of each chamber must submit written requests to the speaker of the House and Senate president. Gov. Josh Green also could call a special session by issuing a proclamation.
Sea turtles were seen foraging a destructive algae in the Northwestern Hawaiian Islands, w…
At the Association of the U.S. Army annual Land Forces Pacific Symposium, or LANPAC, in Wa…
LIHUE — Kipuka Kuleana, in partnership with the County of Kauai Real Property Division a…
Your email address will not be published.
*
*
By participating in online discussions you acknowledge that you have agreed to the TERMS OF SERVICE. An insightful discussion of ideas and viewpoints is encouraged, but comments must be civil and in good taste, with no personal attacks. If your comments are inappropriate, you may be banned from posting. To report comments that you believe do not follow our guidelines, send us an email.
