Sunday, September 14, 2025

Hawaii homeowners are rushing to get solar panels installed on their rooftops before a federal tax credit expires at the end of the year.

Due to the passage in July of H.R.1, the “big, beautiful bill,” the 30% federal tax credit for residential solar PV panels and batteries ends Dec. 31 instead of the end of 2032.

Solar companies are swamped with customers hoping to beat that deadline. Some are even backlogged, and some, such as Revolusun, said they are so booked they have to turn away customers this month.

“A lot of times it’s folks that have been looking at it and were not ready to pull the trigger and make the decision,” said Rock Mould, executive director of the Hawaii Solar Energy Association. “This is the catalyst for pulling that trigger.”

The bump in demand started as early as spring, according to Mould, as some anticipated the federal government would end the tax credits.

To qualify for the federal tax credit, homeowners must actually have their solar energy systems fully installed and ready to generate electricity by Dec. 31, he said. The savings could be as much as $9,000 for an average rooftop solar system.

Hawaiian Electric on Monday said it was committed to processing as many applications as quickly as possible to help customers.

The utility is seeing a surge in applications for residential solar and battery systems — with a high of 1,151 in July — the highest number for any month since March 2024. It’s also a 68.5% increase from June, when there were 683 applications.

The utility expects this robust pace to continue for the rest of the year and said it plans to shift additional staff to process applications if needed.

“We are committed to processing applications as quickly as possible to help customers who want to install and energize their systems by the end of the year,” said Kaiulani Shinsato, Hawaiian Electric Customer Energy Resources co-director, in a news release. “Customer-sited solar and battery storage is a priority for Hawaiian Electric because these systems are key to reaching Hawaii’s decarbonization and clean energy goals.”

The solar systems also need expedited approvals from DPP, which was experiencing hiccups after transitioning to a new software system over the summer.

Mould said DPP is working to get permits approved to meet the deadline, and that he is grateful to Hawaiian Electric as well as Mayor Rick Blangiardi for their support.

While the current rush is keeping solar companies swamped for now, the overall prognosis for the industry is dire.

Mould said nationally, solar companies expect business to drop 30% to 40% next year without that extra tax credit boost for residential customers. That goes for solar jobs, as well.

HSEA has about 75 members, and as of 2024, there were more than 2,400 solar jobs, he said. The state has nearly 100 Hawaii-based solar companies, and he anticipates the changes will make it tough for smaller ones to survive.

The abrupt end to the federal solar tax credit comes at an unfortunate time, as solar PV and battery installations were just gaining momentum this year.

Mould said customers were receptive to an updated “bring your own device” program approved by the state Public Utilities Commission earlier this year.

The costs of solar PV panels have been coming down for years, he said, and the cost of batteries began coming down as well, but “getting that federal support kind of gets it across the line for many customers that wouldn’t be able to afford it otherwise.”

The end of federal tax credits is also a huge setback for Hawaii’s goal of cutting carbon emissions and reaching its 100% clean energy goals by 2045.

“This is pulling the rug out from under us, for sure — a lot of things were happening that were promoting solar and renewable energy,” said Mould, citing the Inflation Reduction Act. “That massive amount of support that was coming from the federal government, that’s all being taken away.”

Then there are the tariffs, which have been like a moving target, and other restrictions that result in uncertainty over equipment costs.

He added, “It’s not just the tax credit for us being taken away, but it’s that whole incentive structure for investing in American renewable energy that’s being taken away by H.R.1, by the Trump Administration and Republican administration.”

Hawaiian Electric recently achieved a milestone, with rooftop solar and battery storage surpassing 1 gigawatt of installed capacity across the five islands it serves. Hawaiian Electric said about 44% of single-family homes it serves now have rooftop solar.

While the industry faces a lot of uncertainty, Mould said investing in solar still makes sense in Hawaii, where electricity costs are so high.

“I think there will be a transition period,” he said. “We’re facing a significant downturn next year, but over time, over the longer term, I think this is still a healthy market for solar.”