Hawaii Solar Tax Credit Changes (2026)
What Hawaii Homeowners Need to Know
“Is solar still worth it in Hawaii?”
The short answer is yes. While Hawaii’s solar incentive landscape has changed, solar continues to be one of the smartest long-term investments for many homeowners. The key is understanding what has changed, what hasn’t, and how today’s financing options and utility programs continue to make solar an attractive option. In this guide, we’ll explain the recent changes to the Hawaii Solar Tax Credit, what we know today, what information is still being finalized by the State, and why many homeowners are still choosing to go solar.What You’ll Learn
In this article, we’ll cover:- 1 What changed to the Hawaii Solar Tax Credit in 2026
- 2 What the Governor’s Executive Order means for homeowners
- 3 What information the State is still working to finalize
- 4 Whether you may still qualify for tax credits
- 5 Why solar can still make financial sense for many Hawaii homeowners
Our Commitment to Providing Accurate Information
The Hawaii solar industry is experiencing significant legislative changes, and some aspects of the new law are still being implemented by the State. Rather than speculate, we’ve created this guide to share what has been officially announced, explain what is still being clarified, and provide updates as new information becomes available.
Our goal is to provide Hawaii homeowners with clear, accurate, and up-to-date information so you can make informed decisions with confidence. As additional guidance is released by the State of Hawaii, we’ll continue updating this article to reflect the latest information available.
What Changed to the Hawaii Solar Tax Credit in 2026?
In 2026, Hawaii passed legislation making significant changes to the state’s Renewable Energy Technologies Income Tax Credit (RETITC). One of the most significant changes was the introduction of a statewide annual funding cap of $40 million for residential renewable energy tax credits. This change understandably raised questions throughout Hawaii’s solar industry, particularly for homeowners who were already planning to install solar and those who were just beginning to explore their options.
Following the passage of the legislation, Governor Josh Green issued an Executive Order intended to protect many homeowners who had already committed to installing solar before the new law took effect. While the State continues to finalize implementation details, the Executive Order provides important reassurance for homeowners whose projects were already moving forward before May 21, 2026. Based on current guidance, homeowners who had already committed to going solar before that date are expected to receive different treatment than projects initiated afterward.
What Does This Mean for Homeowners?
For homeowners who had already signed a contract or otherwise demonstrated a clear commitment to moving forward with solar before May 21, 2026, the Executive Order was designed to help preserve the expectations they relied upon when making their investment.
For homeowners considering solar after that date, the process is still evolving.
The good news is that the Hawaii Solar Tax Credit has not disappeared.
Instead, the State is transitioning to a new system for administering available tax credits under the annual funding cap. While some implementation details are still being finalized, homeowners who are considering solar today should continue to monitor updates and work with experienced professionals who are staying informed as the program develops.
What We’re Still Waiting to Learn
Although the legislation established the new $40 million annual funding cap, the State is still developing the administrative procedures that will determine exactly how the program will operate moving forward.
Some of the questions still awaiting official guidance include:
- How will homeowners apply for the Hawaii Solar Tax Credit under the new system?
- How will available tax credits be allocated throughout the year?
- Will there be a reservation or approval process before installation?
- How will homeowners know whether annual funding remains available?
- What documentation will be required to qualify?
- How will the new income-based eligibility requirements be administered?
These questions relate primarily to how the new program will be administered, rather than whether the tax credit still exists.
At Mālama Solar, we’re actively monitoring updates from state agencies and industry organizations so we can continue providing homeowners with the most accurate and up-to-date information available. As new guidance is released, we’ll continue updating this article so homeowners have a trusted resource they can rely on.
Is Solar Still Worth It in Hawaii?
This is by far the most common question we hear. For many homeowners, the answer is still absolutely.
While these changes have understandably created uncertainty, they should not be interpreted as meaning that solar no longer makes financial sense. The available incentives may be different than they were in previous years, but today’s financing options, utility programs, and long-term electric bill savings continue to make solar an excellent investment for many Hawaii homeowners. While tax credits have historically played an important role in reducing the cost of going solar, they have never been the only factor that determines whether solar makes financial sense.
Today, homeowners still have several opportunities to reduce the overall cost of solar and maximize long-term savings. Depending on your home and your goals, these may include:
- Solar financing options that reduce or eliminate large upfront costs.
- Solar lease programs, which may continue to benefit from federal tax incentives available to the leasing provider. In many cases, those savings help reduce the overall cost of the system, allowing homeowners to continue enjoying many of the financial benefits of solar even though the residential federal tax credit has changed.
- Hawaiian Electric utility programs that allow eligible homeowners to receive compensation for exporting excess energy back to the grid.
- Monthly electric bill savings that continue year after year by generating your own electricity.
Every home is different, which is why the best financial solution depends on factors such as your energy usage, roof layout, financing preferences, and long-term goals.
Don’t Let Changing Incentives Keep You From Exploring Solar
One of the biggest misconceptions we’ve heard recently is:
“The tax credits are gone, so solar probably doesn’t make sense anymore.”
Fortunately, that simply isn’t true for many Hawaii homeowners.
The financial landscape has changed, but so have the financing options, utility programs, and solar products available today. In many cases, homeowners can still achieve significant long-term savings by selecting the financing and incentive programs that best fit their situation. The only way to know what makes the most financial sense is to evaluate your home based on today’s programs – not yesterday’s incentives.
Stay Informed as Hawaii’s Solar Incentives Continue to Evolve
The Hawaii solar industry continues to evolve, and additional guidance surrounding the State’s tax credit program is expected. We’ll continue updating this guide as new information becomes available so Hawaii homeowners have a trusted resource for understanding the latest changes to the Hawaii Solar Tax Credit.
If you’re wondering whether solar still makes financial sense for your home, we’d be happy to review your energy usage, explain today’s financing and incentive options, and provide a personalized savings analysis based on your unique situation.
Hawaii’s solar incentive landscape is changing, but the value of producing your own clean electricity hasn’t changed. For many homeowners, solar remains one of the best ways to reduce long-term energy costs, protect against rising utility rates, and gain greater control over future electric bills.
The most important step is understanding your options and making a decision based on today’s programs – not yesterday’s headlines.
Important Disclaimer
The information provided in this article is intended for general educational and informational purposes only and is based on information publicly available as of the publication date. This article should not be interpreted as legal, tax, accounting, or financial advice. Tax laws, regulations, administrative guidance, and incentive programs may change, and every homeowner’s financial situation is unique.
We strongly encourage homeowners to consult with a qualified CPA, licensed tax professional, or attorney regarding their individual tax circumstances and eligibility for any federal, state, or utility incentive programs before making financial or tax-related decisions.
While Mālama Solar strives to provide accurate and up-to-date information, we cannot guarantee eligibility for any tax credit, rebate, incentive, or utility program, nor can we guarantee the availability of funding under any current or future program.
