.:COMMERCIAL FINANCIAL INCENTIVES
As a result of Global Warming, the recent push for renewable energy has created very attractive tax incentives for Hawaii businesses to go solar!
CREDITS:
30% Federal Business Energy Tax Credit
35% State of Hawaii Energy Conservation Tax Credit
.:DEPRECIATION
Commercial businesses benefit from Federal and State Accelerated Depreciation through the Modified Accelerated Cost Recovery System (MACRS). Solar electric equipment has a life of 5 years under MACRS for Federal and State.
BASIS:
Federal: 85% of the cost of the system!
State: 100%!
In addition to the MACRS, taxpayers can elect Section 179 treatment which allows up to $112,000 to be deducted for 2007 on the Federal return. The remainder, if any, is then under the MACRS. Under the similar State treatment, $25,000 can be taken in year 1.
Example $100,000 system: 28% Federal bracket: The actual cost drops as your federal 28% Bracket 12.75% Cost |
$ 100,000 Cost $ (35,000) State Credit + $ 9,800 Federal Tax on State Credit amount [28% Fed bracket] $ (30,000) Federal Credit $ (32,050) Depreciation [28% Fed / 8.25% State tax brackets] _________________________________ $12,750 COST after tax incentives or 12.75% (non-discounted) |
.:COMMERCIAL SYSTEM EXAMPLES
The following examples are based on the following system and site conditions. Actual results and numbers will vary due to factors such as roof type, roof orientation, tilt racking system, roof accessibility, custom racking system and ground mounts.
Location: Honolulu, Hawaii
Average Sun Hours: 5.4 hours of full sun a day
Roof: Metal standing seam
Electricity costs are based on HECO’s medium business rate “J” of 17.5 cents/KwH (according to HECO 2006 averages). Neighbor islands with higher rates will show much greater savings!
HI Energy Alternatives, Inc, dba Solar Wave
1103 Prospect Street
Honolulu, Hawaii 96822
Phone: 808.531.5585
Fax: 808.531.5586
© 2007, Solar Wave HI Energy Alternatives Inc., All Rights Reserved