Seeing recent coverage of the governor, a Hawaiian kahuna and scores of luminaries in our renewable energy industry blessing the “first” solar-powered battery supply system to be connected to the grid adds insult to injury.
From way back, the generous state solar tax credits were designed to make solar-powered devices “affordable.”
These incentives were a proven profit generator; the net cost reduction due to the tax credits made these devices affordable to many who otherwise would be unable to purchase.
The fact is, when the cost of oil purchased to burn in Hawaiian Electric Co. boilers is deferred, that money can then stay in our state and cycle through our economy, thus driving our tax system.
Simply spoken: Keep the money in the state; that is the very reason for the existence of a tax credit.
So this begs the question: How are Hawaii’s renewable energy goals being achieved by embracing the business model of solar-
related leasing?
The generic terms of solar leasing include a monthly payment for 20 years (usually several thousand dollars yearly for homes and business) to be paid to the out-of-state leasing company.
The recent article, “First Oahu home receives battery-connected solar” (Star-Advertiser, May 7), featuring the governor attending and praising this event as a partial solution to our goal of 100 percent renewable for Hawaii’s future is, in fact, a sales pitch.
One is offered the wonderful opportunity to pay “only” 19 cents per kilowatt hour instead of 22 cents currently being charged by our utility.
But is Hawaii truly being served by keeping a small fraction of our ohana’s money in the state while sending most of it via lease payments, and the tax credit, out of Hawaii?
On average, the small amount of electrical savings kept in our state won’t even match the millions and millions of taxpayer dollars, or about 50 percent of the renewable energy tax credits given per year, to out-of-state leasing companies.
Since none of the major leasing companies are registered in Hawaii, they pay no taxes to speak of. They have no tax liability in Hawaii; therefore they are simply given a check, cash, a refundable credit, resulting in millions and millions of dollars per year — money that leaves the state.
To be clear, there are several hundreds of solar battery systems installed statewide. Then why all the recent hoopla and press coverage?
The article/infomercial gives the impression of a robust solar industry that’s alive and well. The truth is just the opposite.
A Hawaiian kahuna blessing what is pitched as an out-of-state solar lease, while the governor looks on?
A device so expensive as to put it well beyond the means of any average resident then sugar-coated as an out-of-state payment for the next 20 years, with savings of perhaps 10-15 percent of what’s currently spent on energy?
Worse than oil.
At least a barrel of oil, while taking billions out of the state just as solar leasing does, did not receive a tax credit.
One option the governor might look at is locally funded leasing. Incentivize local funds to allow the 20-year payment and tax credits to stay on our shores, to be taxed and generate revenue, to keep our state budget funded, for schools and infrastructure, perhaps retirement funds.
The bottom line: Due to the hundreds of millions in renewable tax credits, due to the 20-year term of payment, due to the fact that all that money leaves our state, solar leasing is worse than a barrel of oil.
Please don’t bless it.
