Arizona is drenched in sunlight, receiving about twice the average daily kilowatt-hours as any other state. All that sunlight coupled with supportive solar policies has landed Arizona among the top solar states in the country – third only to California and North Carolina in total installed solar electric capacity, according to the U.S. Energy Information Administration. Start your Arizona solar panel research below, with detailed information on installers, electricity costs, and various research resources.
Arizona’s Solar
Report Card
To determine a grade for each state, our researchers and solar experts analyzed data on crucial solar-advancement criteria from the following sources:
- Rebates, Tax Credits, and Tax Exemptions from Database of State Incentives for Renewables & Efficiency;
- Electricity Rates from the U.S. Energy Information Administration;
- Renewable Energy Policy from NC Clean Energy Technology Center;
- Interconnection Ease from Freeing The Grid;
- Photovoltaic Potential from the Energy Department
We determined a rank from 1 to 10 for each state in each category. We then combined the scores with the following weights and assigned an overall grade for each state. Our goal is to encourage those considering solar for their homes to get a basic understanding of solar potential in their areas and discover the best opportunities for clean energy available.
Incentives & Rebates, 40%
Electricity Rate, 15%
Renewable Energy Policy, 30%
Interconnection Ease, 5%
Photovoltaic Potential, 10%
Arizona Electricity: Comparison Cost Trends
Electricity is crucial in Arizona, with six in 10 households relying on it as their primary source of heating and a whopping 25 percent of the state’s residential energy taken up by air conditioning, more than four times the national average. Still, the average residential price for electricity is $0.124 per kWh, which is slightly lower than the national residential average of $0.13 per kWh, according to the U.S. Energy Information Administration. So far, about 9 percent of the state’s electricity is generated from renewable resources, mostly in hydroelectric power from the Glen Canyon and Hoover dams but increasingly solar as well. Arizona is in the top 10 states in terms of solar growth projection, according to the EIA.
Cost of Residential Electricity
Data from U.S. Energy Information Administration
*as of Q3 2015
Arizona Solar Energy
Program Library
Policies, Rebates & Incentives for Solar Users in Arizona
For all of its solar potential, Arizona’s Renewable Portfolio Standard calls for a moderate 15 percent of total energy be from renewable sources by 2025. Toward that end, Arizona also finds itself grappling with issues facing other solar states. Increases in utility fees have resulted in a drop in solar installations, and utilities are considering demand charges on solar customers to reduce loads during peak times. However, the state offers the Arizona Public Service Renewable Energy Incentive Program, which provides a rebate of up to $2 per watt of solar energy used. A variety of other rebate programs are available for solar panels in Arizona as are sales and property tax exemptions and a solar tax credit.
REBATES/INCENTIVES
Mohave Electric Cooperative offers an incentive of $0.20/W for solar photovoltaics systems that are up to 50 kW or 125 percent onsite load (whichever amount is less). The maximum amounts allowed are $3,000 for residential PV systems and $5,000 for commercial PV systems.
Duncan Valley Electric Cooperative provides a rebate of $1 per watt for PV systems that are 10 kilowatts (kW) or less. The maximum amount is $10,000 or 40 percent of the system’s cost — whichever amount is less.
None for residential specifically
None for commercial specifically
POLICIES
Allows commercial and residential utility customers with solar technologies to receive credits on their account for the energy their systems generate.
Allows those with PV systems to connect to an energy distribution facility.
The Salt River Project (SRP) allows those with solar energy systems to connect to the SRP’s grid and receive a credit for excess generation during a billing period.
Requires those that sell or install solar energy systems in Arizona to provide a warranty to customers.
This legislation requires that those who want to install PV systems on commercial or residential properties obtain a permit prior to installation.
This law protects the rights of homeowners to install a solar energy device on their property without interference from a homeowner’s association. Also, homeowners can receive reimbursement for reasonable attorney’s fees if they win litigation with a homeowner’s association regarding a solar device on the property.
This law requires that all homes in Tucson have PV systems installed or are built to allow installation at a later date.
None for commercial specifically
TAX CREDITS
Arizona homeowners with solar energy devices receive a tax credit for 25 percent the amount of the device. The maximum credit allowed is $1,000.
Commercial properties can receive a tax credit for solar energy systems of up to 10 percent of the installation costs, not to exceed $25,000 per building or $50,000 per business annually. Energy product manufacturers that expand or establish a business in Arizona can also receive a property tax credit for up to 10 percent. There is a statewide annual cap of $70 million per company.
Renewable Energy Production Tax Credit (Corporate) – Qualified renewable energy systems installed on or after December 31, 2010, may be eligible based on the amount of electricity produced annually for a 10-year period. The tax credit for PV and solar thermal electric systems varies by year of electricity production.
N/A
EXEMPTIONS
The Arizona Solar and Wind Equipment Sales Tax Exemption allows owners of eligible renewable energy systems to receive a 100 percent exemption on sales tax for the unit. The Arizona Department of Revenue also offers the Energy Equipment Property Tax Exemption, which provides an exemption of 100 percent of the increased value of the system.
None for residential specifically
Property Tax Assessment for Renewable Energy Equipment – Renewable energy equipment owned by utilities and other entities operating in Arizona is assessed at 20 percent of the “taxable original cost” after deducting depreciation.
Solar Panels in Arizona: Contractor Directory
With all of Arizona’s sun, it’s not surprising that there are 400-plus solar companies in the state providing solar products and services including solar system design and installation, sales and distribution and manufacturing solar components. Installation prices in Arizona have dropped 15 percent in the past year, according to the Solar Energy Industries Association, making it faster for solar systems to pay for themselves and providing even more incentives for homeowners to go solar. Here is a list of just some of the solar panel contractors in Arizona:
Where it operatesStatewide
Year of opening1998
Where it operatesMaricopa County
Year of opening2001
Where it operatesGoodyear, Phoenix, Tucson, Scottsdale and surrounding areas
Year of opening2007
Where it operatesPhoenix and the surrounding areas
Year of opening2004
Where it operatesMaricopa County
Year of opening2000
Where it operatesMaricopa County
Year of opening2007
Where it operatesMaricopa, Pinal, Gila, Navajo and Yavapai counties
Year of opening1996
Where it operatesNorthern counties
Year of opening1979
Where it operatesStatewide
Year of opening1975
Where it operatesNorthern counties
Year of opening1979
Where it operatesMaricopa County
Year of opening1978
Where it operatesMaricopa, Pinal and Yavapai counties; California
Year of opening1984
Where it operatesPhoenix metro areas including Peoria, Glendale, Scottsdale, Paradise Valley, Fountain Hills, Carefree, Cave Creek, East Valley, West Valley, Surprise, Goodyear, Litchfield Park, Buckeye and Tucson
Year of opening1988
Where it operatesApache Junction, Avondale, Buckeye, Carefree, Casa Grande, Chandler, Fountain Hills, Goodyear, Gilbert, Glendale, Maricopa, Mesa, Peoria, Phoenix, Queen Creek, Scottsdale, Sun City, Surprise and Temp.
Year of opening2010
Where it operatesMaricopa, Yavapai, Pima and Coconino counties
Year of opening2008
Where it operatesBased in north Phoenix, operates statewide
Year of opening2007
Where it operatesThroughout Arizona, including Maricopa, Navajo, Pima, Pinal, Cochise, Yavapai and Coconino counties.
Year of opening2006
Where it operatesPima County
Year of opening2003
Arizona Solar Energy Resource List
Meet the commissioners and find out about upcoming meetings and hearings for the board that regulates rates and services of the state’s public utilities
Explore what the ASC calls “your guide to solar in Arizona,” including technology, economic benefits, solar and sustainability calculators, training and education, and government policy.
Learn about solar technology research at Arizona State University and read an ebook about solar photovoltaics.
Track legislation affecting solar energy, locate upcoming meetings and hearings on solar measures and stay current.
Find out about the solar options available to homeowners with information from the Arizona Corporation Commission and the regulated electric utilities in Arizona.
Find a comprehensive list of solar policies, financial incentives, including loans, grants and rebates, in a database monitored by the N.C. Clean Energy Technology Center.
Explore federal energy data, including state-by-state statistics on electricity consumption and rates as well as an analysis of Arizona’s solar usage and potential.