How much does a solar system cost in Arizona?

The cost of an installed residential solar system in Arizona is about $2.79 per watt before incentives. There is little variance in cost between Phoenix, Flagstaff and Tucson as most of the best solar companies have offices in each city.

After claiming the 26% federal solar tax credit and Arizona’s state tax credit, the price is only $2.00 per watt. This puts the average cost of a 5kW system at $13,958 before incentives and $9,325 after claiming incentives.

How does the 26% federal solar tax credit work?

If you pay federal income taxes, 26% of your solar systems cost can be claimed as a deduction to your federal tax liability. Remember, when filling out the paperwork that the credit is for 26% of the system cost after claiming other incentives.

How much will Arizona’s state tax credit save me?

If you have a state tax liability 25% of the cost of your solar system can be claimed as a deduction to your state taxes up to $1,000. Since it is very unlikely your solar system will cost less than $4,000 you can expect a $1,000 tax credit.

The Arizona tax credit expires on Dec 31, 2020, so we encourage homeowners to go solar before the end of the year to take advantage of it.  

Find out how much money solar incentives can save you in AZ

Why is Arizona such a strong market leader?

A significant reason for the growth of solar power in recent years is Arizona’s RPS law. RPS stands for Renewable Portfolio Standard and requires the states Investor Owned Utilities (IOU’s) to source 15% of their power from renewable sources by 2025. If they don’t do this they will receive large fines.

Arizona also receives more sunshine than any other state. Solar panels in Arizona produce about 70% more power than in states such as New York. An excellent solar output means that it takes less solar panels to reach the desired output.

Does Arizona have a net metering law?

When your solar system produces more energy than needed in your home the excess power is sold to your utility through the grid. Net metering requires your utility to value each kWh of power sent to them at the retail rate you pay for power. Net metering means that for each kWh of energy sent to the grid the cost of 1 kWh is offset from your bill.

When your solar system isn’t producing enough energy to power your home such as at night, energy will be drawn from the grid as normal. Net metering is important because most homeowners are away during the day and using little power in the home, this means more energy from your solar system can be sent to the grid and credited.

Unfortunately in December 2016 net metering was repealed by the Arizona Corporation Commission (ACC) however, a replacement system was adopted that whilst less generous still gives homeowners something close to retail rates for excess solar power they export to the grid.

This is known as a feed-in tariff rather than net metering.

How much is the excess energy from my solar system worth?

From October 1, 2019 onwards, APS values exported solar generation at 10.45 cents per kWh generated. That’s still a pretty good deal as it’s not too much less than the average 12.12 cents/kWh cost of electricy in Arizona (source:

APS customers will receive the same value for energy their solar system sends to the grid for 10 years after interconnection is complete.

Where can I find the best solar installers in Arizona?

Our site has thousands of reviews for Arizona solar installers and we also publish a list of the best rated solar companies in each city in Arizona.

Enter your zip code below to see how much solar can save you, the size solar system you need and local solar companies near you.

You can also estimate of the cost of solar panels, solar savings and payback for any location in Arizona by entering your zip code into the solar calculator below.

See solar panel costs & savings for your home in Arizona

How much electricity do solar panels produce in Arizona?

For each 1kw of solar panels installed on a south-facing roof in Arizona, you can expect to generate 1,752kWh per year.

The table below shows how much electricity solar panels produce in Phoenix for each size of solar system

Learn more: How much power do solar panels produce?

How many solar panels do I need to power my home in Arizona?

The average 2500 square foot home in Arizona uses approximately 12,815 kWhs of power per year. This means that the average home requires a 7.31kw solar system to cover its power needs.

If we assume that we will be using 300-watt solar panels, then you will need approximately 25 solar panels to power your home.

How many square feet of roof space do I need for solar panels?

To find out how much solar panels cost in Arizona you can enter your average APS or Salt River Project monthly power bill into the solar estimate solar panels square feet roof space calculator it will show you how many solar panels you need and how many square feet of roof space you will need for these panels. It will also show you current local solar deals being offered by some of the better solar companies in your area.