Solar power in Arizona

As one of the sunniest states in the country, it’s no surprise that Arizona is a powerhouse for solar energy. About $16.8 billion has been invested in Arizona’s solar industry to date. The state ranks fifth in the U.S. for solar energy production, with growth opportunities on the horizon. Over 10% of the state’s electricity comes from solar sources — enough to power over 1,000,000 homes.

Even though Arizona is already a leader in solar energy, there’s even more growth on the way, thanks to its sunny climate and various solar incentives. If you live in the Grand Canyon State, installing home solar panels can help you save money, reduce your environmental impact, and increase your energy independence. Read on to learn more about going solar in Arizona, including the estimated costs, benefits, and incentives.

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Arizona solar panel cost

How much does solar cost in Arizona? The cost of solar panels in the Grand Canyon State depends on factors like the size, components, configuration of your system, solar panel types, and local labor and permitting costs. According to data from Find Energy, the average cost of an Arizona solar panel system is $3.07 per watt. The average system size is 8 kilowatts (kW), resulting in a total cost of about $24,560. 

The good news is that your solar panels can save you thousands on annual energy costs. You can lower the total cost of solar with the help of incentives like the Residential Clean Energy Credit, which allows you to recover 30% of the cost of your solar system through 2032.

The following table compares the average size and price of a solar system in the U.S. and Arizona.

*Estimated panel count is based on the average panel size ranging from 300 to 400 watts.

How does Arizona solar save you money?

Arizona, like many other states, offers solar rebates. State solar owners get 100% sales and property tax exemptions on solar panels. Combined with the 30% federal tax credit, this can help you save significantly on your solar panel installation in Arizona. 

Once you have switched to solar energy in Arizona, you can start saving on your utility bills. The average monthly electricity bill in Arizona is $146.63. For the typical 8 kW solar system, with the 30% federal tax credit deduction, the payback period in Arizona would be just under10 years. Since electricity rates increase over time, your savings with solar panels could be even more than that.

The following table displays a range of potential solar system sizes and costs at Arizona’s average price per watt of $3.07.

*Estimated panel count is based on the average panel size ranging from 300 to 400 watts.

The best Arizona solar panel incentives or rebates

Solar panels are undoubtedly a significant financial investment. However, federal and Arizona solar incentives can make it more affordable and attractive for homeowners in Arizona. Besides thefederal solar tax credit, Arizona residents can benefit from net billing, solar tax credits, and tax exemptions. 

In October 2023, the Arizona Corporation Commission (ACC), the state regulatory agency overseeing utility companies, proposed a 10% annual reduction in net billing compensation for residential solar owners. However, existing net billing customers would be protected until 2027 under the proposal. If the ACC adopts the new changes, solar panel owners may see savings reductions. The ACC plans to hold a series of hearings before deciding on the current compensation model. 

The following table displays some of the key incentives available to Arizona residents.

Solar incentives in Phoenix

Phoenix is in Maricopa County, where Salt River Project (SRP) and Arizona Public Services Company (APS) provide electrical services for residents. Which company serves you will depend on your location within the county.

• APS offers a Solar Partner program to its customers, who must meet specific eligibility requirements. As part of this program, APS installs rooftop solar for qualified customers who get a $30 credit on their monthly electricity bills for 20 years. These solar panels are considered utility property under Arizona law. The program is currently full and no longer accepting applications, but it’s a good idea to check back if it opens up in the future.
• SRP offers a Solar Choice program to qualified customers, who can offset half or all their energy use with solar power. Like a community solar program, the utility manages and operates Solar Choice instead of a third-party private company. SRP purchases energy from solar farms in Arizona and provides it to customers for half a cent per kilowatt-hour (kWh). 

Solar incentives in Tucson

Tucson Electric Power (TEP) is a municipal utility serving the city of Tucson. TEP recently started offering a GoSolar Home program for its customers. Under this program, you’ll get:

• 100% solar energy generated from a solar farm in southeast Tucson, allowing you to access solar without a home solar installation
• Fixed monthly rate based on your last 12 months of electricity use
• Fixed energy rate for 10 years unless your usage increases or decreases by more than 15%

Solar incentives in Mesa

The City of Mesa offers a municipal net metering program for qualified residential and commercial solar system owners. You can receive a check or credit on your electric bill for sending excess solar generation to the grid.

To qualify for the program, residents must:

• Submit an application to the Energy Resources Department
• Show proof of property ownership and installed solar system
• Complete interconnection documents

Why choose Arizona solar power?

Some advantages of installing solar panels on your home include lowering energy costs, increasing energy independence, and reducing your home’s carbon footprint.

Lower energy costs

Savings are one of the most important benefits of installing solar panels on your property. Anytime your solar panels power your home, you aren’t paying for electricity from the traditional energy grid. How much you will save depends on what you currently pay for the energy your solar panels can generate. 

Increase energy independence

When you’re energy independent, you’re not reliant on the traditional electricity grid to power your home. If you have a solar battery to store excess energy, solar can power your home in the evenings and during power outages. You’re also less vulnerable to price hikes when demand on the grid is high.

Go green

Traditional electricity generation based on burning fossil fuels harms the environment by emitting greenhouse gasses, contributing to climate change and worsening pollution. However, solar power is a renewable and green source. Solar energy does not release carbon into the environment. As a result, installing solar panels can reduce your home’s carbon footprint.

Should I buy or lease my solar panels?

When installing solar panels on your home, you can purchase or finance them upfront, enter a power purchase agreement (PPA) or lease, or subscribe to a community solar program. You’ll make the most significant long-term savings if you buy solar panels. However, that option is not accessible to everyone. The following table delves into some of the pros and cons of each option.

Arizona solar panel companies

As green energy generation — specifically solar energy — becomes more prevalent, so do the companies offering those services. Arizona has nearly 370 solar companies, including more than 164 installers and developers.Learn more about solar panel installers in Arizona using the resources on this page. You can also call us at the number on your screen to get matched with a reliable Arizona solar company in your area.

Solar installer	Year founded	Financing options	Warranty terms
	2010	Cash purchase, solar loan, lease, or PPA	Minimum 12-year product warranty and 25-year performance guarantee
	1985	Cash purchase, solar loan, or lease	25-year full system warranty
	2009	Cash purchase, solar loan, or lease	25-year quality of work and product warranties
	2018	Cash purchase or solar loan	30-year performance warranty, 25-year panel warranty, and 25-year quality guarantee

What to look for in a solar contractor

A good solar contractor should make the solar installation process as stress-free as possible, helping you get permission to operate (PTO), pulling the appropriate permits, and maintaining your panels. When considering solar contractors, search for a company certified by one or more professional organizations, such as the North American Board of Certified Energy Practitioners (NABCEP). Be sure to compare each installer’s reviews, work history, guarantees, and prices. 

If you have friends or family members who have already invested in solar, you can also ask for recommendations. Finding an installer that uses high-quality products and offers strong warranties is important. SaveOnEnergy can help connect you with a reliable solar contractor in Arizona. Call the number on your screen or enter your information in our estimator to get started.

Beware of free solar panels in Arizona scam

While incentives and tax credits can help you save on the costs of solar, there is no such thing as free solar panels. If someone reaches out to you about installing solar panels for free, be aware that it may be a scammer trying to get your sensitive information or trick you into a misleading solar contract. Regardless, don’t engage with these types of offers and don’t give up any personal data.

Important solar installation factors to consider

Solar panels can provide significant energy savings and help the environment, but there are a few things to consider before you install them on your rooftop.

• Roof slope and condition: The U.S. Department of Energy calculated that solar panels best suit south-facing roofs with 15- to 40-degree slopes. You should also consider the age and condition of your roof and evaluate if or when it needs to be replaced.
• Location: Your solar panels will be the most effective if your home gets direct sunshine. It’s important to consider removing any shading around your property before installing solar panels. Talk to an experienced installer to determine what setup will provide optimal solar efficiency for your home. 
• Return on investment: Before buying or leasing solar, estimate how long you plan to live in your home. Purchasing a solar system or signing a lease requires a long-term commitment. If you move in a few years, it may not make sense for your solar investment.
• HOAs: Before installing solar, check with your homeowners association (HOA) or neighborhood rules to determine if they have any restrictions regarding solar arrays. While Arizona law prevents restrictions to solar on private properties, some neighborhoods may have certain requirements regarding the size or appearance of your installation. Your installer can help you navigate any potential roadblocks.