Hawaii energy and electricity

The order concerns renewable-energy technology investment and conditional tax-credit treatment; it does not report generating capacity installed or electricity-price effects. Executive Order 26-02 directs the tax department to exempt qualifying renewable-energy systems placed in service in calendar year 2026 from the $40 million aggregate credit cap. The system must have been completed before May 21, 2026, or the taxpayer must demonstrate reasonable reliance on the credit when investing resources in financing, planning, design, permitting or installation before that date, to the satisfaction of the State Energy Office and tax department. The agencies must cooperate on implementation; the tax department may use temporary rules and existing authority. The order expressly excludes systems that fail those conditions. It does not remove the cap generally, extend the exemption to every later-year system, appropriate $40 million, or establish actual credits paid or electricity-price changes. The original execution date is June 8, 2026; the June 12 announcement is separate. The tax department’s July 31, 2026 Tax Information Release 2026-02 explains that the cap concerns claims made in 2027 for systems installed and placed in service in 2026. It exempts systems installed and placed in service before May 21, and systems placed in service by the end of 2026 with a qualifying payment or cost incurred before May 21. The payment or cost must concern the same system’s financing, planning, design, permitting or installation. Reasonable reliance is presumed when that investment is demonstrated to both agencies. The guidance uses Treasury Regulation 1.461-1(a)(1) and (2) for when payments are made or costs incurred and says certification details will follow. The current energy-office page still says further guidance and filing instructions are forthcoming; this review does not establish individual eligibility or completed certification. The chart does not isolate this action’s effect.

Retained Hawaii evidence context: income-taxes · reviewed Hawaii policy context · deficit-debt-interest · reviewed Hawaii policy context · energy · reviewed Hawaii policy context. This record’s connection to the topic does not establish an effect on the measured result.

The Department of Taxation and Hawai‘i State Energy Office shall cooperate fully on the implementation

The law directly addresses covered electricity-utility regulation and customer bills, with an explicit cooperative-utility exemption. Act 93, the Hawaii Ratepayer Protection Act of 2026, requires the Public Utilities Commission to establish performance-based revenue-adjustment, cost-control and reward or penalty mechanisms on or before January 1, 2027. These mechanisms must tie electric-utility revenues to performance and break the direct link to investment levels. The commission may adopt alternative ratemaking by order using a performance-based revenue model. Its review must consider economic incentives, bill affordability and volatility, reliability, customer engagement, access to system and customer data, renewable integration and timely procurement and interconnection. Member-owned cooperative electric utilities are exempt. The act took effect upon approval June 5, 2026; January 1, 2027 is the commission’s deadline, not a guaranteed lower-bill date. Legislative findings describe intended benefits and prior policy concerns; they do not establish measured savings. Implementing commission orders, later amendments and actual bills require separate evidence. The chart does not isolate this action’s effect.

Retained Hawaii evidence context: Average retail electricity price · energy · reviewed Hawaii policy context · cpi · reviewed Hawaii policy context. This record’s connection to the topic does not establish an effect on the measured result.

This section shall not apply to a member-owned cooperative electric utility.

The law directly addresses covered electricity-utility regulation and customer bills, with an explicit cooperative-utility exemption. Act 93, the Hawaii Ratepayer Protection Act of 2026, requires the Public Utilities Commission to establish performance-based revenue-adjustment, cost-control and reward or penalty mechanisms on or before January 1, 2027. These mechanisms must tie electric-utility revenues to performance and break the direct link to investment levels. The commission may adopt alternative ratemaking by order using a performance-based revenue model. Its review must consider economic incentives, bill affordability and volatility, reliability, customer engagement, access to system and customer data, renewable integration and timely procurement and interconnection. Member-owned cooperative electric utilities are exempt. The act took effect upon approval June 5, 2026; January 1, 2027 is the commission’s deadline, not a guaranteed lower-bill date. Legislative findings describe intended benefits and prior policy concerns; they do not establish measured savings. Implementing commission orders, later amendments and actual bills require separate evidence. The chart does not isolate this action’s effect.

Retained Hawaii evidence context: Average retail electricity price · energy · reviewed Hawaii policy context · cpi · reviewed Hawaii policy context. This record’s connection to the topic does not establish an effect on the measured result.

This section shall not apply to a member-owned cooperative electric utility.

The renewable-energy system and renewable-fuels provisions govern specific Hawaii energy tax incentives; they do not themselves approve a project or establish lower utility bills. The Renewable Energy Technologies Income Tax Credit retains solar and wind credits subject to per-system limits and statutory exceptions. Act 24 adds State Energy Office certification and an aggregate cap of $40 million in each calendar year 2027–2030, followed by $0 beginning January 1, 2031. If applications exceed the cap, certified amounts are allocated in proportion to costs claimed. The application period ends March 1 at 5 p.m. Hawaii Standard Time; the office must notify applicants of certified amounts by May 31. The new adjusted-gross-income ceiling is $175,000 for an individual filer and $350,000 for joint filers. That ceiling applies to tax years beginning after December 31, 2026; the other section 1 amendments apply retroactively to tax years beginning after December 31, 2025. The credit does not apply to tax years beginning after December 31, 2029. Calendar-year caps, installation tax years and filing dates are separate. The renewable fuels production tax credit receives a new cutoff for tax years beginning after December 31, 2028; that amendment applies to tax years beginning after December 31, 2026. Existing conditions remain: qualifying fuels must be sold for distribution in Hawaii, meet the applicable specifications, and have lifecycle emissions below fossil fuels. Production must reach at least 2.5 billion British thermal units per calendar year. The credit is 20 cents per 76,000 British thermal units using lower heating value, limited to $3.5 million per taxpayer per tax year and $20 million across eligible taxpayers per calendar year. Certification, related-entity, filing and refund-election rules remain. The retained maximum ten-year credit period does not override the new statutory cutoff. Josh Green approved the law on May 21, 2026. Section 9 makes approval, retroactive tax-year coverage, the 2027 tax changes, and the January 1, 2028 and January 1, 2029 repeals distinct. Future effective dates are scheduled provisions, not proof that implementation has already occurred. The tax department’s July 31, 2026 Tax Information Release 2026-02 explains that the cap concerns claims made in 2027 for systems installed and placed in service in 2026. It exempts systems installed and placed in service before May 21, and systems placed in service by the end of 2026 with a qualifying payment or cost incurred before May 21. The payment or cost must concern the same system’s financing, planning, design, permitting or installation. Reasonable reliance is presumed when that investment is demonstrated to both agencies. The guidance uses Treasury Regulation 1.461-1(a)(1) and (2) for when payments are made or costs incurred and says certification details will follow. The current energy-office page still says further guidance and filing instructions are forthcoming; this review does not establish individual eligibility or completed certification. There is an unresolved difference between official sources: the signed law sets $40 million for calendar year 2030 and $0 from January 1, 2031, while the tax department’s July 31, 2026 Announcement 2026-06 says allowable credits become $0 on January 1, 2030. Both identify the cutoff for tax years beginning after December 31, 2029. This page retains the signed-law calendar schedule and identifies the differing agency summary separately. These provisions change tax rules and potential state receipts. The $40 million and $20 million figures are aggregate credit limits, not appropriations or guaranteed payments to an individual. Signing does not establish actual credits paid, collections, investment, electricity prices, employment, GDP, debt or interest effects. The official history names Sen. Ronald D. Kouchi as introducer by request of another party; that procedural attribution does not establish personal policy endorsement. The chart does not isolate this action’s effect.

Retained Hawaii evidence context: income-taxes · reviewed Hawaii policy context · deficit-debt-interest · reviewed Hawaii policy context · energy · reviewed Hawaii policy context · real-gdp · reviewed Hawaii policy context. This record’s connection to the topic does not establish an effect on the measured result.

Renewable fuels production tax credit.

The renewable-energy system and renewable-fuels provisions govern specific Hawaii energy tax incentives; they do not themselves approve a project or establish lower utility bills. The Renewable Energy Technologies Income Tax Credit retains solar and wind credits subject to per-system limits and statutory exceptions. Act 24 adds State Energy Office certification and an aggregate cap of $40 million in each calendar year 2027–2030, followed by $0 beginning January 1, 2031. If applications exceed the cap, certified amounts are allocated in proportion to costs claimed. The application period ends March 1 at 5 p.m. Hawaii Standard Time; the office must notify applicants of certified amounts by May 31. The new adjusted-gross-income ceiling is $175,000 for an individual filer and $350,000 for joint filers. That ceiling applies to tax years beginning after December 31, 2026; the other section 1 amendments apply retroactively to tax years beginning after December 31, 2025. The credit does not apply to tax years beginning after December 31, 2029. Calendar-year caps, installation tax years and filing dates are separate. The renewable fuels production tax credit receives a new cutoff for tax years beginning after December 31, 2028; that amendment applies to tax years beginning after December 31, 2026. Existing conditions remain: qualifying fuels must be sold for distribution in Hawaii, meet the applicable specifications, and have lifecycle emissions below fossil fuels. Production must reach at least 2.5 billion British thermal units per calendar year. The credit is 20 cents per 76,000 British thermal units using lower heating value, limited to $3.5 million per taxpayer per tax year and $20 million across eligible taxpayers per calendar year. Certification, related-entity, filing and refund-election rules remain. The retained maximum ten-year credit period does not override the new statutory cutoff. Josh Green approved the law on May 21, 2026. Section 9 makes approval, retroactive tax-year coverage, the 2027 tax changes, and the January 1, 2028 and January 1, 2029 repeals distinct. Future effective dates are scheduled provisions, not proof that implementation has already occurred. The tax department’s July 31, 2026 Tax Information Release 2026-02 explains that the cap concerns claims made in 2027 for systems installed and placed in service in 2026. It exempts systems installed and placed in service before May 21, and systems placed in service by the end of 2026 with a qualifying payment or cost incurred before May 21. The payment or cost must concern the same system’s financing, planning, design, permitting or installation. Reasonable reliance is presumed when that investment is demonstrated to both agencies. The guidance uses Treasury Regulation 1.461-1(a)(1) and (2) for when payments are made or costs incurred and says certification details will follow. The current energy-office page still says further guidance and filing instructions are forthcoming; this review does not establish individual eligibility or completed certification. There is an unresolved difference between official sources: the signed law sets $40 million for calendar year 2030 and $0 from January 1, 2031, while the tax department’s July 31, 2026 Announcement 2026-06 says allowable credits become $0 on January 1, 2030. Both identify the cutoff for tax years beginning after December 31, 2029. This page retains the signed-law calendar schedule and identifies the differing agency summary separately. These provisions change tax rules and potential state receipts. The $40 million and $20 million figures are aggregate credit limits, not appropriations or guaranteed payments to an individual. Signing does not establish actual credits paid, collections, investment, electricity prices, employment, GDP, debt or interest effects. The chart does not isolate this action’s effect.

Retained Hawaii evidence context: income-taxes · reviewed Hawaii policy context · deficit-debt-interest · reviewed Hawaii policy context · energy · reviewed Hawaii policy context · real-gdp · reviewed Hawaii policy context. This record’s connection to the topic does not establish an effect on the measured result.

Renewable fuels production tax credit.

The fact is the EIA West Coast excluding California regional gasoline-price proxy, not a Hawaii-only price. The proposal concerns Hawaii’s state fuel-tax component and does not change taxes in the other states represented by the regional series. This relationship does not establish causation. Actions after the measurement period cannot explain its earlier value.

Retained Hawaii evidence context: West Coast excluding California regular gasoline price. This record’s connection to the topic does not establish an effect on the measured result.

SECTION 2. Section 243-4, Hawaii Revised Statutes, is amended by amending subsection (a) and (b) to read as follows: "(a) Every distributor shall, in addition to any other taxes provided by law, pay a license tax to the department of taxation for each gallon of liquid fuel refined, manufactured, produced, or compounded by the distributor and sold or used by the distributor in the State or imported by the distributor, or acquired by the distributor from persons who are not licensed distributors, and sold or used by the distributor in the State. Any person who sells or uses any liquid fuel, knowing that the distributor from whom it was originally purchased has not paid and is not paying the tax thereon, shall pay such tax as would have applied to such sale or use by the distributor. The rates of tax imposed are as follows: (1) For each gallon of diesel oil, 1 cent; (2) For each gallon of gasoline or other aviation fuel sold for use in or used for airplanes, 1 cent; (3) For each gallon of naphtha sold for use in a power-generating facility, 2 cents; (4) For each gallon of liquid fuel, other than fuel mentioned in paragraphs (1), (2), and (3), and other than an alternative fuel, sold or used in the city and county of Honolulu, or sold in any county for ultimate use in the city and county of Honolulu, [] an amount, to be known as the "city and county of Honolulu fuel tax", as shall be levied pursuant to section 243-5; (5) For each gallon of liquid fuel, other than fuel mentioned in paragraphs (1), (2), and (3), and other than an alternative fuel, sold or used in the county of Hawaii, or sold in any county for ultimate use in the county of Hawaii, [] an amount, to be known as the "county of Hawaii fuel tax", as shall be levied pursuant to section 243-5; (6) For each gallon of liquid fuel, other than fuel mentioned in paragraphs (1), (2), and (3), and other than an alternative fuel, sold or used in the county of Maui, or sold in any county for ultimate use in the county of Maui, [] an amount, to be known as the "county of Maui fuel tax", as shall be levied pursuant to section 243-5; and (7) For each gallon of liquid fuel, other than fuel mentioned in paragraphs (1), (2), and (3), and other than an alternative fuel, sold or used in the county of Kauai, or sold in any county for ultimate use in the county of Kauai, [] an amount, to be known as the "county of Kauai fuel tax", as shall be levied pursuant to section 243-5. If it is shown to the satisfaction of the department, based upon proper records and from any other evidence as the department may require, that liquid fuel, other than fuel mentioned in paragraphs (1), (2), and (3), is used for agricultural equipment that does not operate upon the public highways of the State, the user thereof may obtain a refund of all taxes thereon imposed by this section in excess of 1 cent per gallon. The department shall adopt rules to administer such refunds. (b) Every distributor of diesel oil, in addition to the tax required by subsection (a), shall pay a license tax to the department for each gallon of diesel oil sold or used by the distributor for operating a motor vehicle or motor vehicles upon public highways of the State. The rates of the additional tax imposed are as follows: (1) For each gallon of diesel oil sold or used in the city and county of Honolulu, or sold in any other county for ultimate use in the city and county of Honolulu, [] an amount, to be known as the "city and county of Honolulu fuel tax", as shall be levied pursuant to section 243-5; (2) For each gallon of diesel oil sold or used in the county of Hawaii, or sold in any other county for ultimate use in the county of Hawaii, [] an amount, to be known as the "county of Hawaii fuel tax", as shall be levied pursuant to section 243-5; (3) For each gallon of diesel oil sold or used in the county of Maui, or sold in any other county for ultimate use in the county of Maui, [] an amount, to be known as the "county of Maui fuel tax", as shall be levied pursuant to section 243-5; and (4) For each gallon of diesel oil sold or used in the county of Kauai, or sold in any other county for ultimate use in the county of Kauai, [] an amount, to be known as the "county of Kauai fuel tax", as shall be levied pursuant to section 243-5. If any user of diesel oil furnishes a certificate, in a form that the department shall prescribe, to the distributor or if the distributor who uses diesel oil signs the certificate, certifying that the diesel oil is for use in operating a motor vehicle or motor vehicles in areas other than upon the public highways of the State, the tax as provided in paragraphs (1) to (4) shall not be applicable. If a certificate is not or cannot be furnished and the diesel oil is in fact for use for operating a motor vehicle or motor vehicles in areas other than upon public highways of the State, the user thereof may obtain a refund of all taxes thereon imposed by the foregoing paragraphs. The department shall adopt rules to administer the refunding of such taxes. (c) For taxable years beginning after December 31, 2025, tax savings based on the repeal of the state fuel and oil tax shall be passed on from the distributor to the consumers as much as practicable." SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored. SECTION 4. This Act, upon its approval, shall apply to taxable years beginning after December 31, 2025. INTRODUCED BY: _____________________________