Why Solar Still Makes Sense for Hawaii Rentals, Even After 2025
The federal renewable energy tax credit for homeowners, known as the Residential Clean Energy Credit, is set to expire after December 31, 2025, under the new One Big Beautiful Bill Act.
That means homeowners who install solar after 2025 won’t be able to claim the familiar 30 percent federal credit.
But for rental property owners, the story is very different. Installing solar on investment property remains one of the smartest, most financially sound upgrades you can make, especially in Hawaii.
You Still Qualify for Strong Tax Benefits
Even though the homeowner credit is ending, rental and business properties still qualify under the Federal Investment Tax Credit (ITC), which remains in effect.
That means you can still take advantage of:
- 30 percent Federal Tax Credit for qualifying solar PV systems
- Accelerated Depreciation (MACRS + Bonus), allowing most of the cost to be written off within a few years
- Hawaiʻi State Solar Tax Credit worth up to 35 percent of the system cost, or 24.5 percent if taken as a refundable credit
Together, these incentives can often offset more than half the system’s cost in the first year – a rare combination of savings and long-term value.
Lower Operating Costs and Higher Property Value
Solar directly reduces energy expenses for shared meters, common areas, or tenant utilities, which improves your net operating income (NOI).
And when NOI goes up, so does your property value. Lower electricity costs and sustainability appeal make solar-equipped rentals more competitive and profitable.
The Bottom Line
Even with the homeowner solar credit expiring after 2025, solar for rental and investment properties continue to offer major financial and operational advantages, from generous tax incentives to stronger cash flow and property value growth.
For Hawaii property owners, solar isn’t just about saving on electricity — it’s about building a more efficient, resilient, and sustainable investment for the long term.
As a friendly reminder, we are a solar installation company. Please consult your tax advisor for guidance on filing for tax credits with respect to your specific circumstances.
