Solar Pays For Itself in 3 – 4 Years
Wouldn’t it be great to anticipate your electricity bill of $18.00 a month. How about $216.00 a year instead of $2,400 a year or more. The cost of electricity continues to rise annually. How much more can your budget withstand. What are you giving up in order to keep up with the rising cost of your utilities? Why struggle when you can go solar.
Most people think that Photovoltaic Systems are an expensive investment. It’s not as big as you may think. Help is available.
Solar Energy Financing
The Green Loan
Take advantage of the 2.99% Green Loan available from University of Hawaii Credit Union. If you are not a member you can open an account for as low as a $50.00 opening balance to start the process to qualify for the Green Loan.
O% financing for 2 years also available.
Solar Energy Tax Credits
- The State of Hawaii has a 35% tax credit and the Federal Government have a 30% tax credit.
- If you don’t pay State taxes, a 24.5% tax credit may be available instead of the full State tax credit.
- Federal Grant is available.
- (Please check with your accountant to see if you qualify for any of the above)
Example: Taxpayer installs and places into service solar energy equipment on a single-family residential property which has a total output capacity of 7.5 kilowatts and an actual cost of $37,500.
In order to calculate the credit, the actual cost per kilowatt must be determined by dividing the actual cost by the total output capacity. The actual cost per kilowatt is $5,000 ($37,500 divided by 7.5 kilowatts). Since a system installed and placed in service on a single-family residential property must have a total output capacity of at least 5 kilowatts, the actual cost of the first system is $25,000 ($5,000 times 5 kilowatts).
The credit for the first system is $5,000 because thirty-five percent of $25,000 exceeds the applicable cap of $5,000. A credit for the second system may also be claimed because subsection (b)(2) permits taxpayers to claim the credit for one system per property that fails to meet the total output capacity requirement. The actual cost of the second system is $12,500 ($5,000 times 2.5 kilowatts). The credit for the second system is $4,375 or thirty-five percent of $12,500. [Eff ] (Auth: HRS §§23110.7, 235-12.5) (Imp: HRS §235-12.5)
Because of our high electricity rate here on Oahu, most Photovoltaic systems depending on the type of module and size of the system, can have a payback of the investment in approximately 3 to 4 years.
Photovoltaic not only has a short term pay off on the initial investment, but will continue to pay the homeowner back in lower electricity monthly bills for decades. This can amount to thousands of dollars over the lifetime of the system.
Photovoltaic adds value to property and the form (Alternate Energy Improvements) allows for your property to be exempt from added taxes for value of improvement for 25 years.
File the papers with the department of property taxes using the form “Alternate Energy Improvements (ROH Sec.231-10.7)”