30% of system cost
Federal Solar Tax Credit (ITC)
Arizona homeowners can deduct 30% of their solar system cost from federal taxes through 2032.
☀️ Arizona Solar Guide 2026
Best Solar Installers in Arizona
Arizona is the sunniest state in America with 299+ sunny days per year. Combine that with state tax credits, property tax exemptions, and net metering — and solar is an incredible investment here.
299+
Sunny Days/Year
$1,600
Avg Annual Savings
5.9 yrs
Avg Payback Period
$2.60
Avg Cost per Watt
Arizona Incentives
Arizona Solar Incentives & Rebates
Arizona stacks impressive state incentives on top of federal benefits, maximizing your solar ROI.
25% up to $1,000
AZ Residential Solar Tax Credit
Arizona offers an additional state tax credit of 25% of system cost (capped at $1,000) on top of the federal ITC.
Credits for excess energy
Net Metering / Net Billing
Arizona utilities including APS and SRP offer net metering or net billing programs that compensate you for excess solar energy.
Exempt from assessment
Property Tax Exemption
Arizona's property tax exemption ensures your solar panels don't increase your property tax bill, protecting your investment.
Save ~5.6% on purchase
Sales Tax Exemption
Arizona exempts residential solar energy devices from state sales tax (Transaction Privilege Tax), reducing your upfront cost.
FAQ
Arizona Solar FAQs
How much do solar panels cost in Arizona in 2026?
The average cost of solar panels in Arizona is approximately $2.40–$2.80 per watt before incentives. For a typical 7kW system, that's $16,800–$19,600 before the 30% federal tax credit and $1,000 state credit, bringing the net cost to roughly $10,760–$12,720.
What solar incentives are available in Arizona?
Arizona offers the 30% federal ITC, a 25% state solar tax credit (up to $1,000), net metering/billing programs, property tax exemption, and sales tax exemption on solar equipment.
Is Arizona a good state for solar panels?
Arizona is arguably the best state in the country for solar. With 299+ sunny days per year (most of any state), combined with both federal and state tax credits plus tax exemptions, Arizona homeowners see some of the fastest payback periods nationally.
How does Arizona net metering work?
Arizona's net metering varies by utility. APS offers a Resource Comparison Proxy (RCP) rate for exported energy, while SRP uses a customer generation plan. Both provide compensation for excess solar energy, though the rates differ from full retail.
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