HI SB2737

Establishes an energy storage tax credit for taxpayers installing energy storage property in Hawaii, deductible against net income tax liability.

Provides an investment tax credit ranging from 30% (for properties placed in service after June 30, 2016 through December 31, 2017) declining to 15% (for properties placed in service after December 31, 2021) of the property's basis for systems storing energy for on-site use.

Alternatively provides a production tax credit for energy storage systems delivering electricity to third parties, paying 8 cents per kilowatt-hour (through December 31, 2018), declining to 4 cents per kilowatt-hour (after December 31, 2022), for kilowatt-hours delivered during the first ten years of operation.

Allows excess credits under the investment option to carry forward to subsequent years unless the taxpayer elects a 30% reduction to receive a refund; production credits are fully refundable.

Requires the Department of Taxation and Department of Business, Economic Development, and Tourism to submit annual reports on credit usage and economic impact, and directs DBEDT to complete a study by December 31, 2019 evaluating whether the credit should be continued, eliminated, or revised.