Solar Power Rebates, Tax Credits and Solar Panel Incentives in Arizona; 2012 Update
Arizona has made some recent improvements to its solar power initiatives that will go towards helping more Arizonians into solar power.
It is important to note that each Utility in Arizona operates a different incentive or rebate program. So as always you need to talk to your quoting companies about your particular circumstances.
Federal Tax Credit
The single most significant financial incentive for your solar power system in Arizona is the same Federal Tax Credit that applies right across the USA. This gives you a credit on your Federal Tax bill equivalent to 30% of the cost of your solar system For more information on this visit out page "The 30% federal tax credit for residential solar power systems" Because this is a tax credit you get the benefit of this when you do your next federal tax return, rather than getting a cheque on the day of installation. Still, it has a real value if you are in a position where you are paying annual federal income tax equivalent to 30% or more of the value of your solar system.
There are some very generous solar rebates to be found in Arizona and we are talking thousands of dollars worth here folks. The amount of cash you will receive is based on the installation size of your system and the rebate your electricity provider is paying per kW installed. The below table gives you an idea of what is available;
|Electric District #3||$1350/kw||$10,000|
|UES||$1600/kw||No more than 50% of costs|
|Mohave Electric Cooperative||$2000/kw||Lesser of $30,000 or 40% of costs|
|Sulphur Springs Valley EC||$2000/kw||40% of costs|
State Tax Credit
Arizona residents are eligible for a $1000 State Tax Credit that can be used towards State income taxes.
Yes, the sales tax exemption does apply to Arizona residents as does the exemption from higher property taxes due to the increased value of your home.
Utility Policies and Prices
Arizona legislature has required utilities to get to at least 15% of their energy from renewable sources by 2025. Only 2.25% of the total needs to come from residential renewable energy like solar or wind. There are penalties in place for utilities that do not meet their targets and at the end of the day that is why they offer the incentives that they do. Recently the Utilities seem to have become more confident in reaching their targets as they have reduced the incentives.
Net Metering and Inter Connection
Net metering basically means that your electricity utility monitors how much energy you use from the grid and how many kWh (kilowatt hours) your solar power system puts back into the grid. It is important to note that Net metering is only available while your system doesn't exceed 125% of your current requirements. This means its important to work with your solar installers ( 3 quotes remember) to design the right sized system for your household. If you get it right you will have a 25% surplus which means you can get the extra power you generate turned into dollars, and that ain't bad.
Arizona Solar Summary
Arizona has decided to get serious with its solar incentives programs and is heading in the right direction as far as solar power customers are concerned. It could be better but it is a long way ahead of some other states. Payback times on solar power systems are about 10 years or less at present which is not bad but it would be good to get it down a bit more. As always the best thing you can do is talk to your local experts click "here" to get 3 quotes from your local solar businesses.