Summary of Arizona solar incentives 2021
Arizona is one of the sunniest states in the country. Just because of this fact alone, you can save a lot of money here with solar. Arizona’s renewable portfolio standards require utilities to generate a portion of their renewable output from distributed energy technologies -- 30% to be exact. Half of this requirement must be derived from residential installations.
Luckily for you, this requirement can be fulfilled by residential solar systems, but it is not limited to just solar panels. These conditions have created the right environment for utility companies in Arizona to offer residential solar incentives.
In addition to reading on to see what incentives you qualify for, use our calculator above to see how much you can save with solar.
On this page, you can:
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Learn what solar incentives are available to Arizona homeowners
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See what Arizona solar incentives you qualify for based on your utility company and city
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Find out how much these incentives and/or Arizona solar tax credits will reduce your cost to go solar and add batteries
Federal solar investment tax credit
The federal solar investment tax credit will have the biggest impact on the cost you will face to go solar in Arizona
This perk is commonly known as the ITC, short for “Investment Tax Credit”. If you install your photovoltaic system in 2020, the federal tax credit is 26% of the cost of your solar panel system. This is 26% off the entire cost of the system including equipment, labor and permitting.
Example: If your solar energy system costs $20,000, your federal solar tax credit would be $20,000 x 26% = $5,200.
The federal tax credit falls to 22% at the end of 2022.
Net energy metering in Arizona
With net metering in some states, you get full retail rate credit for the amount of electricity you send back into the grid with your solar panels.
Net metering policy lets you store the extra solar energy you produce and aren’t able to use at home with the utility. They then credit your bill at night when the sun ain’t shining. So, no batteries needed.
While Arizona’s net metering policy is not as strong as other states, you can still save quite a bit of money even with the extra fees on solar owners and reduced payments for your electricity that APS has successfully lobbied for.
There are a whole host of confusing solar rate plans offered by the three major utility companies here, which sound like they are an exceptional deal for solar owners. However, the average net metering rates for APS, SRP, and TEP are about $0.03/kWh, significantly less than your retail rates, but at least it’s something.
If anything, this low net metering rate encourages solar owners to store more energy onsite with home battery systems.
Arizona solar rebates
With its strong renewable portfolio standard, Arizona once had a great variety of solar panel rebate programs offered by nearly all the state's electric utilities. However, many of those generous solar panel rebate programs have been exhausted because utilities are getting close to meeting their requirements for off-site solar electricity production.
The good news is some rebates still exist for certain homeowners. The bad news is that they only exist for customers of a handful of rural electric co-ops. If you're a customer of any of the co-ops listed below, you're in luck.
Home energy storage rebate
SRP offers a battery storage incentive program that offers direct rebates to homeowners who install solar batteries. The current incentive offers $300 per kWh of storage, up to $3,600 maximum. At $300/kWh, this accounts for about half of the cost of the battery itself (not including installation).
At that price, home batteries begin to make a lot more sense, especially given their ability to eliminate your daily peak usage and reduce demand charges associated with net metering rates.
Arizona solar tax credit
Every resident in Arizona who installs solar panels gets a State Tax Credit of 25% of the total system cost, up to $1,000, to be used toward State income taxes.
That is a nice bonus to add to the 26% Federal Solar Tax Credit. There's no cap on the federal tax credit and it can be claimed over multiple years if necessary.
Solar sales and property tax exemptions in Arizona
Your solar installation will increase your property value by an average multiple of twenty times your annual electricity savings. In Arizona, that can amount to an average amount north of $30,000. Luckily, that home value increase is exempt from property tax assessments.
Moreover, solar equipment is also exempt from sales taxes, so you save more upfront here by avoiding that.
Cost of solar panels in your part of Arizona after all applicable solar incentives
Solar prices near you
Payback period
7.3-8.9 years
Net profit (savings less system cost)
$35,212-$43,037
Average size system installed in AZ in 2021
8.3kW
Solar panel cost calculator
Best 10 solar companies in Arizona
94 solar companies in Arizona provide pricing on SolarReviews. Here are the best rated companies near you.
4.93 242 Reviews
Latest review
Charles Pfeister, 1 week ago
The guys at Arizona Solar Wave did our last house so we decided to use them again on our new build. Very happy we went with them.
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Latest review
Charles Pfeister, 1 week ago
The guys at Arizona Solar Wave did our last house so we decided to use them again on our new build. Very happy we went with them.
4.92 206 Reviews
Latest review
Gary Shapiro, over 1 month
I don't often write reviews, but was so happy with my recent solar installation by Black Platinum Solar and Electric, I asked them if I could write a review! I started discussing my solar needs with four different solar companies in December of 2020. Black Platinum came onto my radar due to their many positive reviews in Nextdoor.com. In late January I chose them because the sales manager David Armstrong was most informative and the most responsive to my many questions. There was no sales pitch, just an honest desire to help me make an informed decision. My system was designed in early February and installed in early March. Everything went exactly on schedule. The crew was on time and cleaned up after themselves. The owner John Black personally phoned me several times to ensure I was informed about the progress and answer any questions I had. My system is now up and running, and I could not be happier. And John followed up again to be sure I was happy. I truly am.
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Latest review
Gary Shapiro, over 1 month
I don't often write reviews, but was so happy with my recent solar installation by Black Platinum Solar and Electric, I asked them if I could write a review! I started discussing my solar needs with four different solar companies in December of 2020. Black Platinum came onto my radar due to their many positive reviews in Nextdoor.com. In late January I chose them because the sales manager David Armstrong was most informative and the most responsive to my many questions. There was no sales pitch, just an honest desire to help me make an informed decision. My system was designed in early February and installed in early March. Everything went exactly on schedule. The crew was on time and cleaned up after themselves. The owner John Black personally phoned me several times to ensure I was informed about the progress and answer any questions I had. My system is now up and running, and I could not be happier. And John followed up again to be sure I was happy. I truly am.
4.77 75 Reviews
Latest review
Leslie Lawson, 4 days ago
TFS as a team was impressive. Tamarack communicated to us the different phases of the project which was very helpful in organizing our schedule. Mike and the other technicians completed the install efficiently with little disruption to our daily routine. Steve connected the monitoring unit and showed us how to monitor the system on our phone in an easy to follow manner. All in all we are very pleased with the service TFS provided.
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Latest review
Leslie Lawson, 4 days ago
TFS as a team was impressive. Tamarack communicated to us the different phases of the project which was very helpful in organizing our schedule. Mike and the other technicians completed the install efficiently with little disruption to our daily routine. Steve connected the monitoring unit and showed us how to monitor the system on our phone in an easy to follow manner. All in all we are very pleased with the service TFS provided.
4.76 82 Reviews
Latest review
Scott M, over 1 month
How I came to know them is a little too long of a story for a review here. A Salesman had just left another company and told me he had signed up with Sunny Energy as they are the best here in Arizona. After doing hours of research into various companies, types of panels, size of system overall, financing and a dozen other questions, I decided Sunny Energy was my best choice price wise and reputation wise as well as the best warranty and customer service. I have been extremely please with their follow up, explanation of everything, how it all works, what to expect etc etc.
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Average cost (5kW system)
$13,750 ($2.75 per watt)
Latest review
Scott M, over 1 month
How I came to know them is a little too long of a story for a review here. A Salesman had just left another company and told me he had signed up with Sunny Energy as they are the best here in Arizona. After doing hours of research into various companies, types of panels, size of system overall, financing and a dozen other questions, I decided Sunny Energy was my best choice price wise and reputation wise as well as the best warranty and customer service. I have been extremely please with their follow up, explanation of everything, how it all works, what to expect etc etc.
4.76 69 Reviews
Latest review
Excellent Customer Experience, over 1 month
From the first contact to the start-up, our solar installation went extremely well. Would highly recommend this company to anyone seeking to convert to solar power.
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Latest review
Excellent Customer Experience, over 1 month
From the first contact to the start-up, our solar installation went extremely well. Would highly recommend this company to anyone seeking to convert to solar power.
4.75 94 Reviews
Latest review
Errol AZ, over 1 month
I was about to sign up with another company to upgrade my system with an additional 7.4MW when a friend suggest I get a second quote from Sun Valley Solar. The sales manager Kelley was very responsive and professional. She suggested e.g. that I match the panels on my existing system which she said were a "best buy" in their price range and would avoid incompatibility issues, delete the bird guard (no trees that side of the house), add a sub-panel electrical box instead of replacing my existing 1-year old panel, and add a couple of extra solar panels at minimal cost to better meet my needs. Overall a better system and thousands $ saved. Installation was also very neat and professional. My wife let the electrician know she would have preferred a different placement of the new sub-panel within our garage. The electrician came back a few days later with extra conduit piping to move the sub-panel and rewire selected fuses from the kitchen and bathrooms so that my wife could reset tripped switches from inside the garage instead of the main box outside. No extra charge. I did have a problem where the new system went down a few months later during the 120 degree heat of Arizona summer. Sun Valley was responsive in quickly sending out technicians. However, it kept crashing repeatedly after each of three "fixes" over three weeks. The technicians said the manufacturer kept insisting it was an installation issue but they said they were now convinced it was a hardware issue. I called the sales rep Kelley and she quickly took charge and the next day a new improved inverter was installed. I've waited 6 months to see how the system fared before writing this review. Happily the system has been functioning now without any issues. Overall, a professional company with pleasant and responsive staff in all departments who care about the customer and their company.
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Latest review
Errol AZ, over 1 month
I was about to sign up with another company to upgrade my system with an additional 7.4MW when a friend suggest I get a second quote from Sun Valley Solar. The sales manager Kelley was very responsive and professional. She suggested e.g. that I match the panels on my existing system which she said were a "best buy" in their price range and would avoid incompatibility issues, delete the bird guard (no trees that side of the house), add a sub-panel electrical box instead of replacing my existing 1-year old panel, and add a couple of extra solar panels at minimal cost to better meet my needs. Overall a better system and thousands $ saved. Installation was also very neat and professional. My wife let the electrician know she would have preferred a different placement of the new sub-panel within our garage. The electrician came back a few days later with extra conduit piping to move the sub-panel and rewire selected fuses from the kitchen and bathrooms so that my wife could reset tripped switches from inside the garage instead of the main box outside. No extra charge. I did have a problem where the new system went down a few months later during the 120 degree heat of Arizona summer. Sun Valley was responsive in quickly sending out technicians. However, it kept crashing repeatedly after each of three "fixes" over three weeks. The technicians said the manufacturer kept insisting it was an installation issue but they said they were now convinced it was a hardware issue. I called the sales rep Kelley and she quickly took charge and the next day a new improved inverter was installed. I've waited 6 months to see how the system fared before writing this review. Happily the system has been functioning now without any issues. Overall, a professional company with pleasant and responsive staff in all departments who care about the customer and their company.
4.65 65 Reviews
Latest review
Graham, 6 days ago
Rooftop solar did two installs for us. We were impressed by their professionalism and care about getting things right. A delay occurred and we were given our APS bill payment from rooftop solar to cover the time that we did not have Solar available. How many companies would do that? Also since the two installs, rooftop solar has stayed on top of our account and provided explanations and understanding of oh well the system is operating. We highly recommend this company, and as mentioned, We had them do the second installation also on our vacation rental home. Good folks!
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Latest review
Graham, 6 days ago
Rooftop solar did two installs for us. We were impressed by their professionalism and care about getting things right. A delay occurred and we were given our APS bill payment from rooftop solar to cover the time that we did not have Solar available. How many companies would do that? Also since the two installs, rooftop solar has stayed on top of our account and provided explanations and understanding of oh well the system is operating. We highly recommend this company, and as mentioned, We had them do the second installation also on our vacation rental home. Good folks!
4.62 57 Reviews
Latest review
Great Solar Install, over 1 month
I got quotes for solar install from 4 different companies, 2 of them the biggies in the industry, one out of N Phoenix area and Verde Solar Power. I went with Verde Solar Power because they use US made panels, their pricing was very attractive (I purchased the system), their install timeframe was reasonable and they were local. I was impressed with the installation crew. Those guys were professional, courteous, diligent, and safety conscious. At various times each one of them answered my many questions about solar technology and the install process.
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Average cost (5kW system)
$10,250 ($2.05 per watt)
Latest review
Great Solar Install, over 1 month
I got quotes for solar install from 4 different companies, 2 of them the biggies in the industry, one out of N Phoenix area and Verde Solar Power. I went with Verde Solar Power because they use US made panels, their pricing was very attractive (I purchased the system), their install timeframe was reasonable and they were local. I was impressed with the installation crew. Those guys were professional, courteous, diligent, and safety conscious. At various times each one of them answered my many questions about solar technology and the install process.
4.62 35 Reviews
Latest review
Timothy & Janice Carlton, over 1 month
(no comments provided)
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Latest review
Timothy & Janice Carlton, over 1 month
(no comments provided)
4.61 14 Reviews
Latest review
Donna Manelis , 2 days ago
Choosing FOR Energy was easy, once we met Sean we knew we had the right company for us. His knowledge, expertise and attention to detail was exactly what we needed to help us choose Solar for our newly built home.
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Latest review
Donna Manelis , 2 days ago
Choosing FOR Energy was easy, once we met Sean we knew we had the right company for us. His knowledge, expertise and attention to detail was exactly what we needed to help us choose Solar for our newly built home.
Solar guides for your Arizona city
For more information about going solar near where you live, check out the following resources:
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