Cost of Solar Panels in Arizona: Best Solar Companies, Cost and Installation

Solar is a complicated decision and OhmHome has compiled this guide to Arizona solar with the cost of solar panels in Arizona and advice on how to estimate cost and savings, navigate state and federal incentives, and find the best solar companies in Arizona.

Solar Trends in Arizona

Arizona solar permits increased 5% to 499 in June from 475 in June 2016 and increased 9% from May 2017 (YTD increase of 8%)

Cost of Solar Panels in Arizona

The cost of solar has dropped significantly in recent years due to the increase in module supplies and other supply chain efficiency improvements. According to the U.S. Department of Energy’s Q4-16 Sunshot report, the median price of residential solar in major markets was $4.20 per watt with the lowest 20% at approximately $3.50 per watt.

Solar Incentives in Arizona

Arizona offers the Residential Solar Energy Credit, which is a tax credit up to 25% of the cost of the device or a maximum of $1,000. Arizona’s largest utility, APS, does not currently offer any incentives for residential solar energy other than net metering. For a full list of potential utility incentives for residential solar in Arizona, refer to the DSIRE database.

Federal Solar Tax Incentives

The IRS offers a 30% tax credit for solar systems based on the cost after state rebates and credits (discussed above). It is important to note that that federal tax credit only applies to purchased systems and you need sufficient tax liability to claim the credit. The federal solar tax credit was set to expire in 2016, but was recently extended through 2019, at which point it will start to decrease to 10% by 2022. The IRS form 5695, Residential Energy Credits can be found here.

Solar Financing in Arizona

The number of solar financing options has expanded significantly in recent years to includes a number of low-interest rate loans, as well as power purchase agreements or solar leases. To learn more, refer to our lease or buy solar guide.