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2026 Solar Investment Incentives Secured: Businesses and Property Owners Should Act Now

·10 min read·⚡ Act Now

Executive Summary

Governor Green's executive order preserves 2026 state solar tax credits, maintaining significant financial incentives for renewable energy installations. This preserves current project economics and provides a defined window for businesses and property owners to secure benefits before potential 2027 policy changes. Small Business Operators and Real Estate Owners should expedite solar project planning and permitting to capture these credits within the 2026 tax year.

Action Required

Medium PriorityBefore end of 2026 tax year

The executive order preserves credits for projects *this year*, indicating a benefit or opportunity that may be time-limited by tax year completion or future legislative changes.

Small Business Operators, Real Estate Owners, Entrepreneurs, and Healthcare Providers aiming to install solar should expedite 2026 project planning and permitting now to secure current tax credits. Finalize contracts and interconnections before the end of the 2026 tax year to avoid the 2027 policy changes.

Who's Affected
Small Business OperatorsReal Estate OwnersEntrepreneurs & StartupsAgriculture & Food ProducersHealthcare Providers
Ripple Effects
  • →Preserved solar tax credits → sustained investment in renewable energy → reduced reliance on imported fossil fuels → potentially lower long-term energy costs for businesses and consumers
  • →Maintained solar incentives → increased demand for local solar installation services → job creation in the green energy sector → potential upward pressure on wages for skilled solar technicians
  • →Lower operational energy costs for businesses → improved profit margins → increased capacity for reinvestment in business growth, staffing, or product development
  • →Enhanced attractiveness of Hawaii properties with solar → increased property values and market appeal → potential positive impact on the real estate sector and attractiveness for new residents/businesses
Aerial shot of a solar-powered building by a tropical beach with lush greenery and crashing waves.
Photo by Jess Loiterton

2026 Solar Investment Incentives Secured: Businesses and Property Owners Should Act Now

Governor Josh Green has signed an executive order preserving the state's solar tax credits for projects initiated in 2026. This order effectively delays the impact of Act 24, which was set to alter the credit structure, until 2027. This ensures that businesses, property owners, and other entities planning solar installations this year can still benefit from the existing tax credit program, safeguarding project economics and encouraging renewable energy adoption.

The Change

On June 13, 2026, Governor Green issued an executive order that postpones the implementation of changes to solar tax credits mandated by Act 24. The original intent of Act 24 was to adjust the existing solar tax credit program, but this order ensures that the current credit structure remains in place for all qualifying solar projects throughout the 2026 calendar year. This means that any project that begins construction or is contracted in 2026 will be eligible for the full extent of the current tax credits, providing a predictable financial incentive. The deferral means that the new regulations introduced by Act 24 will not take effect until January 1, 2027, effectively offering a one-year extension for the existing incentive framework.

Who's Affected

This executive order provides immediate financial planning certainty for several key sectors within Hawaii's economy:

  • Small Business Operators: Businesses such as restaurants, retail shops, service providers, and local franchises can continue to leverage solar tax credits to offset the significant capital expense of installing solar power systems. This lowers long-term operational costs, improving margins and contributing to sustainability goals. The preservation of these credits means that projects planned for 2026 can proceed with more predictable budgeting, potentially reducing the payback period for solar investments by 10-20% compared to a scenario without credits.
  • Real Estate Owners: Property owners, developers, and landlords benefit from maintained incentives for installing solar on residential, commercial, or mixed-use properties. This makes solar installations more attractive for new developments and retrofits, potentially increasing property values and reducing tenant utility costs. For developers, this maintains a key selling point and cost-saving feature in a competitive market.
  • Entrepreneurs & Startups: Growing businesses and startups can utilize these credits to reduce initial operating expenses and demonstrate a commitment to sustainability, which can be attractive to investors and customers. Lowering energy costs provides essential operating capital that can be reinvested in scaling operations, talent acquisition, or product development.
  • Agriculture & Food Producers: Farms, ranches, and food processing facilities often have large roof spaces or land available for solar arrays. Maintaining the credits allows these producers to reduce high energy expenditures common in agricultural operations, potentially lowering the cost of goods produced and increasing competitiveness, especially for export-oriented businesses facing logistical costs.
  • Healthcare Providers: Private practices, clinics, and medical facilities can lower energy overhead with solar installations. Reduced utility bills free up capital for investment in equipment, staffing, or expanding services. For telehealth providers, lower operational costs can enhance the affordability and accessibility of their services across the islands.

Second-Order Effects

The preservation of solar tax credits for 2026 has several ripple effects in Hawaii's unique, island-based economy. Firstly, it supports continued investment in renewable energy infrastructure, reducing reliance on imported fossil fuels and stabilizing energy costs for the long term. This leads to lower overall energy prices → reduced operating costs for all businesses → increased consumer spending power → greater demand for goods and services. Furthermore, by maintaining these incentives, the state encourages a more robust local solar installation industry, potentially leading to increased demand for skilled labor in installation and maintenance, and indirectly supporting local supply chains for equipment and services. The sustained incentive can also make Hawaii more attractive for businesses looking to operate with a lower environmental footprint, potentially drawing new investment and talent.

What to Do

Given the confirmed extension of solar tax credits for 2026, the primary action for affected parties is to accelerate the planning and permitting process for solar installations. Here’s a breakdown by role:

  • Small Business Operators: If you have been considering a solar installation to reduce operating costs, finalize your system design and engage with solar installers immediately. Aim to have your contract signed and, if possible, your interconnection application submitted before the end of the 2026 tax year to ensure eligibility. Consult with your tax advisor to understand the specific credit application process and any required documentation. The window to fully leverage these benefits is the 2026 tax year; delaying decisions risks missing out on valuable financial incentives.
  • Real Estate Owners: For property owners and developers, integrate solar into planned projects now. If you are in the process of leasing commercial space, consider adding solar feasibility and cost-benefit analysis to tenant negotiations. Properties with installed solar systems are becoming increasingly attractive to a market that values sustainability and lower utility costs. Secure bids from reputable solar installers and begin the permitting process to lock in your eligibility for the 2026 tax credits.
  • Entrepreneurs & Startups: Conduct a thorough energy audit and explore solar installation as a means to significantly reduce overhead. Work with your financial team to model the long-term savings and explore financing options that can be optimized by the tax credits. Given the limited time, prioritize initiating the process to benefit from the 2026 credits. Waiting until 2027 may mean facing potentially less favorable credit structures.
  • Agriculture & Food Producers: Evaluate current energy consumption and the potential for solar to offset these costs. Engage with agricultural energy consultants and solar providers who understand the unique needs of farms and food production facilities. Begin the process of obtaining quotes and understanding the permitting requirements to ensure your project is on track for 2026 eligibility. Securing stable, lower energy costs can be critical for managing margins in this sector.
  • Healthcare Providers: Initiate discussions with solar energy providers to assess the feasibility and financial benefits of installing solar on clinic or practice buildings. Prioritize projects that can be completed and qualify for the 2026 credits. Understanding how these credits can reduce capital expenditure will be crucial for budgeting and financial planning in the healthcare sector, where operational costs are often substantial.

This executive order provides a clear, time-bound opportunity. Waiting until the latter half of 2026 could lead to longer lead times with installers and permitting agencies, potentially jeopardizing eligibility for the 2026 credits. Proactive engagement now is key to maximizing financial benefits.

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