Hawaii Incentives and Laws

Last Updated July 2009

Hawaii is the home of the Honolulu Clean Cities Coalition (www.cleancities.us). Coordinator contact information is listed in the Points of Contact section.

State Incentives

Electric Vehicle (EV) and Infrastructure Grants

The Hawaii Transportation Energy Transformation Grant Fund has been established within the Department of Business, Economic Development, and Tourism (Department) to provide grants for the acquisition of EVs, the installation of EV charging infrastructure, and the development of innovative programs or the coordination of activities that diversify transportation energy sources. The Department will review all applications and is required to provide annual statistical information regarding program participation to the Governor and state legislature. (Reference Senate Bill 1202, 2009, and Hawaii Revised Statutes 201)

Business Investment Tax Credit

Through December 31, 2010, taxpayers making a high technology business investment are eligible for a tax credit the year in which the investment is made and may be carried over for up to four additional years. A qualified high technology business is defined as one in which more than 50% of the activities are qualified research (75% of which is conducted in Hawaii) and in which more than 75% of the income (i.e. income from products sold from, manufactured or produced in Hawaii or from services performed in Hawaii) is derived from qualified research. Qualified research includes research that is related to non-fossil fuel energy-related technology. The tax credit is equal to a percentage of the investment made, up to the following maximums:

Tax credits cannot exceed the amount of the investment or exceed 80% of the taxpayer's income tax liability in the year in which the credit is claimed.

(Reference Senate Bill 199, 2009, and Hawaii Revised Statutes 235-7.3 and 235-110.9)

Point of Contact

Hawaii State Department of Taxation
Phone (800) 222-3229
http://www.state.hi.us/tax/tax.html

Ethanol Production Incentive

An income tax credit is available for qualifying ethanol production facilities equal to 30% of nameplate capacity between 500,000 and 15 million gallons per year. The facility must produce at least 75% of its nameplate capacity to be eligible to receive the tax credit each year, and the tax credit may be taken for up to eight years. The credit is only available to the first 40 million gallons of ethanol produced per year. Qualifying ethanol production facilities must be in operation prior to January 1, 2017. (Reference Hawaii Revised Statutes 235-110.3)

State Laws and Regulations

Electric Vehicle (EV) Parking Requirement

All public, private, and government parking facilities with at least one hundred parking spaces must designate at least 1% of the spaces specifically for EVs by December 31, 2011. One of the parking spaces must be located near the building entrance and must be equipped with an EV charging unit that meets recognized standards. Owners of multiple parking lots may designate and install an EV charging unit in fewer parking spaces than required in one parking lot, as long as the total number of aggregate spaces for all parking lots is met. The spaces designated for EVs will continue to increase by 1% for each additional 5,000 registered EVs until the percentage reaches 10%. Penalties apply for non-EVs that park in parking spots designated for EVs. (Reference Senate Bill 1202, 2009, and Hawaii Revised Statutes 226-10 and 291)

Alternative Fuel and Advanced Vehicle Acquisition Requirements

Once the state has met its federal and state vehicle acquisition mandates, state and county agencies, beginning January 1, 2010, must move toward purchasing light-duty vehicles that meet the needs of the agency while reducing petroleum consumption. The priority to be used for purchasing such vehicles is as follows:

1) electric vehicles (EVs) or plug-in hybrid electric vehicles;
2) hydrogen or fuel cell vehicles;
3) other alternative fuel vehicles;
4) hybrid electric vehicles; and
5) vehicles identified as top performers for fuel economy in the U.S. Environmental Protection Agency's annual "Fuel Economy Leaders" report.

Exemptions may apply. State agencies are also required to purchase alternative fuels and ethanol blended gasoline when available, evaluate a purchase preference for biodiesel blends, and promote efficient operation of vehicles. For the purpose of this requirement, an alternative fuel is defined as an alcohol fuel, an alcohol fuel blend containing at least 85% alcohol, natural gas, liquefied petroleum gas, hydrogen, biodiesel, a biodiesel blend containing at least 20% biodiesel, a fuel derived from biological materials, and electricity provided by off-board energy sources.

(Reference Senate Bill 1202, 2009, and Hawaii Revised Statutes 103D-412 and 196-9)

Electric Vehicle (EV) Promotion

In order to achieve Hawaii's transportation efficiency goals and to create jobs, foster economic growth, and reduce greenhouse gas emissions, the Hawaii Senate encourages the promotion of EV use in the state. As a first step, EV charging infrastructure must be developed. Additionally, stakeholders should work together to expedite the use of EVs in Hawaii. (Reference Senate Resolution 82, 2009, and Senate Concurrent Resolution 126, 2009)

Alternative Fuels Promotion

The state of Hawaii has signed a Memorandum of Understanding (MOU) (PDF 108 KB) with the U.S. Department of Energy to collaborate to produce 70% of the state's energy needs from energy efficient and renewable sources by 2030. Download Adobe Reader. This effort is part of the Hawaii Clean Energy Initiative. The goals of the partnership include defining the structural transformation required to transition the state to a clean energy-dominated economy; demonstrate and foster innovation in the use of clean energy, including alternative fuels; create opportunities for the widespread distribution of clean energy benefits; establish an open learning model for other states and entities to adopt; and build a workforce with cross-cutting skills to support a clean energy economy in the state.

Renewable Fuel Standard

At least 85% of Hawaii's unleaded gasoline must be fuel blends containing at least 10% ethanol (E10). Gasoline blended with an ethanol-based product, such as ethyl tertiary butyl ether, will be considered to be in conformance with this requirement. Retail fuel distributors must meet this requirement and report to the state Petroleum Commissioner (the Administrator of the Energy, Resources, and Technology Division of the Department of Business, Economic Development, and Tourism) on a monthly basis. (Reference Hawaii Revised Statutes 486J-10 and Hawaii Administrative Rules Title 15, Department of Business, Economic Development and Tourism, Chapter 35)

Point of Contact

Hawaii Department of Business, Economic Development, and Tourism
Phone (808) 587-3814
http://www.hawaii.gov/dbedt/ert/new-fuel/

Biofuels Production Land Use Allowance

In order to reduce dependence on petroleum, achieve environmental sustainability, and create jobs, the state of Hawaii permits the use of lands originally zoned as agricultural land use districts to be used for renewable energy production, storage, and distribution, including the production of biofuels. Biofuels production facilities must be integrated with an agricultural activity and may not adversely impact agricultural land and other agricultural uses in the vicinity. Biofuels production facilities include facilities that produce liquid or gaseous fuels from organic sources such as biomass crops, agricultural residues, food wastes, animal residues and wastes, and oil crops including palm, canola, soybean, and waste cooking oils. (Reference Hawaii Revised Statutes 205-2 and 205-4.5)

Idle Reduction Regulation

A gasoline- or diesel-powered vehicle may not idle at a loading zone, parking or service area, route terminal, or other off-street areas, except for the following situations: during adjustment or repair of the engine; during auxiliary vehicle operations such as cranes and certain bulk carriers, provided no visible smoke is emitted and the vehicle is being used for its intended purpose; during loading and unloading of passengers, not to exceed three minutes; and during engine start-up and cool-down, not to exceed three minutes. (Reference Hawaii Administrative Rules 11-60.1-34)

Energy Feedstock Program

The Energy Feedstock Program was established within the Hawaii Department of Agriculture to promote and support the production of energy feedstock in Hawaii and establish milestones and objectives for energy feedstock to be grown in the state to meet its energy requirements. Energy feedstock includes feedstock used to produce biofuels. (Reference Hawaii Revised Statutes 141-9)

Biofuels Procurement Preference

State and county agency contracts for the purchase of diesel fuel are to be awarded with preference given to bids for biofuels or blends of biofuel and petroleum fuel. When purchasing fuel for use in diesel engines, the preference price is $0.05 per gallon of B100; for blends containing both biodiesel and petroleum-based diesel, the preference is applied only to the biodiesel portion of the blend. Biodiesel is defined as a vegetable oil-based fuel that meets ASTM specification D6751. Biofuel is defined as fuel from non-petroleum plant or animal based sources that can be used for the generation of heat or power. (Reference Hawaii Revised Statutes 103D-1012)

Alternative Fuel Development Support

The state of Hawaii is responsible for facilitating the development of alternative fuels and supporting the attainment of a statewide alternative fuels standard. The alternative fuels standard will be as follows: 10% of highway fuel use to be provided by alternative fuels by 2010, 15% by 2015, and 20% by 2020. For the purposes of the alternative fuels standard, ethanol produced from cellulosic materials is to be considered the equivalent of 2.5 gallons of non-cellulosic ethanol. (Reference Hawaii Revised Statutes 196-42)

Hydrogen Energy Plan and Fund

A Hawaii Renewable Hydrogen Program has been established within the state Department of Business, Economic Development, and Tourism to manage the state's transition to a renewable hydrogen economy. A Hydrogen Investment Capital Special Fund has been created to provide seed capital for, and venture capital investments in, private sector and federal projects for research, development, testing, and implementation of the Hawaii Renewable Hydrogen Program. The Hawaii Renewable Hydrogen Program is responsible for designing, implementing, and administering activities including:

1) Strategic partnerships for the research, development, testing, and deployment; engineering and economic evaluations;
2) Demonstration projects, including infrastructure for the production, storage, and refueling of hydrogen vehicles;
3) Statewide hydrogen economy public education and outreach plan promoting Hawaii's renewable hydrogen resources to potential partners and investors;
4) A plan, for implementation during 2007 to 2010, to deploy hydrogen technologies and infrastructure, including hydrogen production facilities, refueling stations, and vehicles;
5) A plan, for implementation during 2010 to 2020, to transition the island of Hawaii to a hydrogen-fueled economy and to extend the application of the plan throughout the state; and
6) Evaluation of policy recommendations to: encourage the adoption of hydrogen vehicles; continually fund the hydrogen investment capital special fund; and support investment in hydrogen infrastructure.

(Reference Hawaii Revised Statutes 196-10 and 211F-5.7)

Neighborhood Electric Vehicle (NEV) Access to Roadways

An NEV may operate at speeds of up to 25 miles per hour (mph) and is only permitted on roads with speed limits of 35 mph or less. An NEV must have a notice of the operational restrictions pertaining to the vehicle permanently attached to, or painted on, the vehicle in a location that is in clear view of the driver. An NEV is a self-propelled electrically powered motor vehicle that is emission free, has four wheels in contact with the ground, has a gross vehicle weight rating of less than 2500 pounds, and conforms to the minimum safety equipment requirements contained in Title 49 of the Code of Federal Regulations, section 571.500. (Reference Hawaii Revised Statutes Sections 286-2, 286-41, and 291C-134)

Alternative Fuel Tax Rate

A distributor of any alternative fuel for operation in an internal combustion engine is required to pay a license tax of $0.025 for each gallon of alternative fuel sold or used by the distributor. In addition, a distributor is required to pay a license tax for each gallon of fuel sold or used by the distributor for operating a motor vehicle(s) on state public highways according to the following rates:

For other alternative fuels, the rate is based on the energy content of the fuels as compared to diesel fuel, using a lower heating value of 130,000 British thermal units per gallon as a standard for diesel, so that the tax rate, on an energy content basis, is equal to one-quarter the rate for diesel fuel. (Reference Hawaii Revised Statutes Section 243-4)

Utilities/Private Incentives

There are currently no known utility or private incentives offered in Hawaii.

Points of Contact:

NAME/EMAIL/TITLE	AGENCY	PHONE/FAX
Robert Primiano Clean Cities Coordinator	Honolulu Clean Cities Coalition	Phone:(808) 768-3500 Fax:(808) 768-3506
Mike Bednarz Project Manager	U.S. Department of Energy, National Energy Technology Laboratory	Phone:(412) 386-4862 Fax:(412) 386-4183
Maria Tome Renewable and Transportation Energy Program Manager	Hawaii State Energy Office, Department of Business, Economic Development & Tourism	Phone:(808) 587-3809 Fax:
	Hawaii Department of Business, Economic Development, and Tourism	Phone:(808) 587-3814 Fax:
	Hawaii State Department of Taxation	Phone:(800) 222-3229 Fax:
Collette Craig AFV Contact, Region 9	U.S. General Services Administration	Phone:(928) 524-3975 Fax:(928) 524-2324