SOLAR FARMS LLC

FEDERAL INCENTIVES

Federal Investment Tax Credit Extension

On October 3, 2008, President Bush signed an 8-year extension of the business Investment Tax Credit for solar, small-wind, and geothermal systems. The ITC gives businesses a tax credit equal to 30% of the net cost of an installed solar electric, solar thermal, fuel cell, and small-scale wind system. 

Changes to Alternative Minimum Tax (AMT) Law

Businesses may now apply the Investment Tax Credit toward money owed to the Internal Revenue Service under the Alternative Minimum Tax (AMT).

5-Year Depreciation

Businesses may further recover costs for investment in solar power and solar thermal systems by taking advantage of 5-year accelerated depreciation on all generating equipment and its installation under the IRS's Modified Accelerated Cost Recovery System.

USDA Loans and Grants

Through its Rural Energy for America (REAP) program, the United States Department of Agriculture offers loans and grants to rural businesses installing solar, wind, geothermal, and biomass energy systems. Almost all of Hawaii is considered rural. Eligible businesses must have fewer than 500 employees and annual gross revenues under $6 million. Learn more.

  • Grants: Provide up to 25% of total cost of system. Range between $2,500 and $500,000 for renewable energy projects and $1,500 and $250,000 for energy efficient improvements projects costing more than $10,000.
  • Loans: Loans range between $5,000 and $10,000,000 and may cover no more than 50 percent of the total project cost.

STATE AND LOCAL INCENTIVES

Hawaii Solar and Wind Energy Credit

Businesses in Hawaii can receive a state tax credit for their investments in solar power, solar thermal, and wind power systems. These credits cover the cost of equipment and installation. Businesses may receive the following credits:

  • Solar Thermal: 35% of the actual cost or $250,000, whichever is less.
  • Solar Power: 35% of the actual cost or $500,000, whichever is less.
  • Wind Power: 20% of the actual cost or $500,000, whichever is less.

Commercial Rebate Program

Hawaiian utility companies HECO, MECO and HELCO offer their commercial customers a rebate for installation of solar thermal systems on a case-by-case basis. They also provide design assistance and energy reduction incentive payments to help with the initial purchase.