In the years since Hawaii first began expanding its renewable energy initiatives, it has become clear that solar PV is going to be one of the most important technologies in the state’s future energy portfolio. Before you can start investing in PV installation in Hawaii, you need to make sure that you understand all of the financial, legal, and operational factors that will come into play along the way. Here 4 important factors to consider before making an investment in PV in Hawaii.
1) Cost of electricity
The cost of electricity is a major factor when it comes to deciding whether solar panels are right for you. Solar panel systems typically carry initial costs between $10,000 and $40,000. It is feasible only when these expenses can be offset by reduced energy bills over time.
In Hawaii, the average electricity cost as per “hawaiianelectric” is 37.92 cents/kWh for residential systems and 43.82 cents/kWh for commercial or small power businesses. This makes solar panels a good investment for homeowners on the amazing Island of Hawaii. One can get faster return returns by using solar panels due to high electricity rates.
2) The State and Condition of your Roof
The very important thing you need to consider before investing in a solar panel system is your roof. Is it in good condition? Does it have any leaks or damages? If so, you might want to get those fixed first. Also, if you’re planning on selling your home anytime soon, then adding a solar panel system can be an added value for potential buyers.
Your roof should be capable of supporting a solar panel system. If you have a low-slope or flat roof, then it’s probably fine. However, if your home has a steep roof with multiple angles and pitches, then it might not be ideal for installing solar panels. Also, shade from trees, awnings, or other obstructions above your roof might reduce energy production. Make sure there’s nothing shading your roof before you decide on a solar panel system.
3) How long does it take for PV Installation to Pay for Itself?
In Hawaii, the weather is mostly sunny throughout the year. This means that solar panels can produce electricity for a longer period of time. This also means that it will take less time for your solar panels to pay for themselves.
It’s important to consider how long it takes for you to recoup your investment when deciding whether or not you should invest in solar panels. The average payback period for solar systems in Hawaii is around 7 years. The payback period actually depends on factors such as type of system and how much energy your system produces.
4) What Type of Solar Panel Incentives are available in Hawaii?
Another thing to consider before investing in solar panels is whether or not you’ll be eligible for any incentives. Incentives are a great way to save money on your investment, so it’s important to know what they are and how they work. If you live in Hawaii, there are incentives that can help reduce your initial costs:
1. 35% solar tax credit by State: In Hawaii, you can receive a state tax credit of 35 cents percent for solar systems. This tax credit is available for all new residential solar systems but with a limit of $2,250.
2. Net Metering in Hawaii: Huawei doesn’t offer traditional net metering, but Hawaiian Electric Company, Inc.(HECO) offers Customer Self Supply and Customer Grid Supply options. Under these two options, customers can sell excess electricity back to HECO at retail rates when their system is generating more power than they are using.
3. Federal Solar Tax Credit: There is a 26% federal tax credit for residential solar systems throughout the United States that can be used to offset your federal taxes. This tax credit can be claimed when you submit your annual income tax return.