HOUSE OF REPRESENTATIVES

H.B. NO.

497

TWENTY-SEVENTH LEGISLATURE, 2013

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO RENEWABLE ENERGY.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


     SECTION 1.  Section 235-12.5, Hawaii Revised Statutes, is amended as follows:

     1.   By amending subsections (a), (b), and (c) to read:

     "(a)  When the requirements of subsection (d) are met, each individual or corporate taxpayer that files an individual or corporate net income tax return for a taxable year may claim a tax credit under this section against the Hawaii state individual or corporate net income tax.  The tax credit may be claimed for every eligible renewable energy technology system that is installed and placed in service in the State by a taxpayer during the taxable year.  The tax credit may be claimed as follows:

     (1)  For each solar [energy] electricity generating system[:] that is not a utility scale solar electricity generating system and is placed in service:

(A)  Prior to the 2014 tax year:  thirty-five per cent of the actual cost [or the cap amount determined in subsection (b), whichever is less; or];

(B)  During the 2014 tax year:  thirty per cent of the actual cost;

(C)  During the 2015 tax year:  twenty-five per cent of the actual cost; or

(D)  During and after the 2016 tax year:  twenty per cent of the actual cost;

(2)  For each utility scale solar electricity generating system installed after the 2013 tax year:  11.5 cents per kilowatt hour generated during the first one hundred twenty months of the system's operation; provided that projects with contracts approved by the public utilities commission prior to the end of the 2014 tax year shall have the option of using the tax credit as it existed on the date that the contract was submitted to the public utilities commission;

(3)  For each solar energy system that uses energy from the sun to heat water for household use:  thirty-five per cent of the actual cost or the cap amount determined in subsection (b), whichever amount is less; provided that the taxpayer has not claimed the tax credit under paragraph (1) for the same system; or

[(2)] (4)  For each wind-powered energy system:  twenty per cent of the actual cost or the cap amount determined in subsection (b), whichever is less;

provided that multiple owners of a single system shall be entitled to a single tax credit; and provided further that the tax credit shall be apportioned between the owners in proportion to their contribution to the cost of the system.

     In the case of a partnership, S corporation, estate, or trust, the tax credit allowable is for every eligible renewable energy technology system that is installed and placed in service in the State by the entity.  The cost upon which the tax credit is computed shall be determined at the entity level.  Distribution and share of credit shall be determined pursuant to section 235-110.7(a).

     (b)  The amount of credit allowed for each eligible renewable energy technology system shall not exceed the applicable cap amount, which is determined as follows:

     (1)  If the primary purpose of the solar energy system is to use energy from the sun to heat water for household use, then the cap amounts shall be:

         (A)  [$2,250] $2,500 per system for single-family residential property;

         (B)  [$350] $1,000 per unit per system for multi-family residential property; and

         (C)  $250,000 per system for commercial property;

    [(2) For all other solar energy systems, the cap amounts shall be:

         (A)  $5,000 per system for single-family residential property; provided that if all or a portion of the system is used to fulfill the substitute renewable energy technology requirement pursuant to section 196-6.5(a)(3), the credit shall be reduced by thirty-five per cent of the actual system cost or $2,250, whichever is less;

         (B)  $350 per unit per system for multi-family residential property; and

         (C)  $500,000 per system for commercial property; and

     (3)] (2)  For all wind-powered energy systems, the cap amounts shall be:

         (A)  $1,500 per system for single-family residential property; provided that if all or a portion of the system is used to fulfill the substitute renewable energy technology requirement pursuant to section 196-6.5(a)(3), the credit shall be reduced by twenty per cent of the actual system cost or $1,500, whichever is less;

         (B)  $200 per unit per system for multi-family residential property; and

         (C)  $500,000 per system for commercial property.

     (c)  For the purposes of this section:

     "Actual cost" means costs related to the renewable energy technology systems under subsection (a), including accessories and installation, but not including the cost of consumer incentive premiums unrelated to the operation of the system or offered with the sale of the system and costs for which another credit is claimed under this chapter.

     "Household use" means any use to which heated water is commonly put in a residential setting, including commercial application of those uses.

     "Renewable energy technology system" means a new system that captures and converts a renewable source of energy, such as solar or wind energy, into:

     (1)  A usable source of thermal or mechanical energy;

     (2)  Electricity; or

     (3)  Fuel.

"Solar electricity generating system" means any system that uses the sun's energy to produce electricity either directly, as is the case with photovoltaics, or indirectly, as is the case with concentrating solar power technologies.

     "Solar or wind energy system" means any identifiable facility, equipment, apparatus, or the like that converts solar or wind energy to useful thermal or electrical energy for heating, cooling, or reducing the use of other types of energy that are dependent upon fossil fuel for their generation.

     "Utility scale solar electricity generating system" means any solar electricity generating system that is interconnected to a utility grid at sub-transmission or transmission voltage."

     2.   By amending subsection (e) to read:

     "(e)  The director of taxation shall prepare any forms that may be necessary to claim a tax credit under this section, including forms identifying the technology type of each tax credit claimed under this section, whether for solar or wind.  The director may also require the taxpayer to furnish reasonable information to ascertain the validity of the claim for credit made under this section and may adopt rules necessary to effectuate the purposes of this section pursuant to chapter 91.  Taxpayers claiming the credit for utility scale solar electricity generating systems in any taxable year shall document each system's production for that tax year with a separate notarized letter from an electrical engineer licensed in Hawaii attesting to the number of kilowatt hours produced by the system in that tax year."

     3.   By amending subsection (g) to read:

     "(g)  For solar electricity generating systems and other solar energy systems, a taxpayer may elect to reduce the eligible credit amount by thirty per cent and if this reduced amount exceeds the amount of income tax payment due from the taxpayer, the excess of the credit amount over payments due shall be refunded to the taxpayer; provided that tax credit amounts properly claimed by a taxpayer who has no income tax liability shall be paid to the taxpayer; provided further that the tax credit for solar electricity generating systems that are not utility scale solar electricity generating systems shall be fully refundable without the necessity of reducing the eligible credit amount for systems installed during or after the 2017 tax year; and provided further that no refund on account of the tax credit allowed by this section shall be made for amounts less than $1.

     The election required by this subsection shall be made in a manner prescribed by the director on the taxpayer's return for the taxable year in which the system is installed and placed in service.  A separate election may be made for each separate system that generates a credit.  An election once made is irrevocable."

     SECTION 2.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 3.  This Act shall take effect on July 1, 2013, and shall apply to taxable years beginning after December 31, 2013.

 

INTRODUCED BY:

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Report Title:

Renewable Energy Technology; Tax Credit

 

Description:

Amends the tax credit for solar energy systems.  Defines certain types of solar energy systems and the tax credits applicable to each.  Effective July 1, 2013; applicable to taxable years after December 31, 2013.

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.