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Arizona Rebates

Arizona's Solar Energy Credit provides an individual or business with a tax credit for installing a solar or wind energy system at the taxpayer's Arizona property. Arizona has some of the best solar rebate incentives and a sunny climate that is ideal for using solar panels on your home or business. Here you will find details about the Arizona Solar Initiative and the numerous renewable energy rebates available to Arizona homes and businesses for low-cost solar installation.

Arizona Solar Rebates Summary

Rebate Type Rebate Amount
Federal IRS Energy Tax Credit 30% of total solar installation value
Solar Power Installation Rebate $2,000 to $3,000 per kW installed, varies by installation type, up to 50% of cost.
Arizona Solar and Wind Renewable Energy Credits SRECs 25% of cost or up to $1,000 maximum credit per residence
Property Tax Exemption 100% of increased amount or system value
Sales Tax Exemption 100% of system value
State Tax Credit $1,000 maximum credit per residence, regardless of number of energy devices installed

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Arizona Public Service (APS) Renewable Incentive Program

Incentive Type: Arizona Utility Solar Power Rebate Program
Eligible Renewable Energy Technologies: Solar Water Heat, Solar Space Heat, Solar Thermal Process Heat, Photovoltaics, Landfill Gas, Wind, Biomass, Geothermal Electric, Geothermal Heat Pumps, Solar HVAC, Solar Pool Heating, Day-lighting, Anaerobic Digestion, Small Hydroelectric, Other Distributed Generation Technologies
Applicable Sectors: Commercial, Residential
Incentive Amount: PV incentives may be de-rated based on expected performance
Grid-tied residential PV: $3/watt DC
Off-grid Residential (less than 5 kW): $2/watt DC;
Grid-tied non-residential PV: $2.50/watt DC or production-based incentive (PBI)
Off-grid non-residential PV: $1.50/W DC or PBI
Residential/small solar water heating: $0.75/kWh of estimated first-year savings
Commercial/large solar water heating and solar HVAC systems: production based incentive
Solar Daylighting: $0.20/kWh estimated first year savings
Other renewables: performance-based incentive
Maximum Incentive: PV: 50% of project costs. Up-front incentive payment is limited to $75,000
SWH: 50% of system costs
Eligible System Size: No size restrictions for grid-connected systems specified; Less than 5 kW for off-grid systems.
Under the small SWH system incentive, systems must have OG-300 ratings of 10,000 kWh per year energy savings. Large SWH systems have minimum 5,000 kWh/yr. estimated energy savings
Installation Requirements: PV systems must be installed by a licensed contractor holding one or more of the following certifications with the Arizona Registrar of Contractors: C-11, K-11, L-11.
SWH systems must be installed by a licensed contractor holding one or more of the following certifications with the Arizona Registrar of Contractors, C-37, C-37R, K-77, K-78, L-77, L-78.
Ownership of Renewable Energy Credits: Arizona Public Service

Through the Renewable Incentive Program, Arizona Public Service (APS) offers customers who install various renewable energy sources the opportunity to sell the credits associated with the energy generated to APS.

Arizona Residential Solar and Wind Energy Systems Tax Credit

Inncentive Type: Personal Tax Credit
Eligible Renewable/Other Technologies: Passive Solar Space Heat, Solar Water Heat, Solar Space Heat, Photovoltaics, Wind, Solar Ovens, Solar Cooling, Solar Pool Heating, Daylighting
Applicable Sectors: Residential
Amount: 25%
Maximum Incentive: $1,000 maximum credit per residence, regardless of number of energy devices installed
Carryover Provisions: Excess credit may be carried over 5 years.
Eligible System Size: Not specified
Equipment/Installation Requirements: System must be new and in compliance with all applicable performance and safety standards; must carry a minimum 2-yr warranty on collectors, heat exchangers, and storage units; other equipment and installation must carry a minimum 1-yr warranty.

Arizona's Solar Energy Credit provides an individual taxpayer with a credit for installing a solar or wind energy device at the taxpayer's Arizona residence. The credit is allowed against the taxpayer's personal income tax in the amount of 25% of the cost of a solar or wind energy device, with a $1,000 maximum allowable limit, regardless of the number of energy devices installed. The credit should be claimed in the year of installation and if the amount of the credit exceeds a taxpayers liability in a certain year, the unused portion of the credit may be carried forward for up to five years.

Qualifying technologies include solar domestic water heating systems, solar swimming pool and spa heating systems, solar photovoltaic systems, solar photovoltaic phones and street lights, passive solar building systems (trombe walls, thermal mass, etc.), solar daylighting systems (excluding conventional skylights), wind generators, and wind powered pumps.

In addition to federal tax credits and state exemptions, the majority of Arizona solar panel rebates come from local utility companies. Below are some examples of Arizona solar rebates available through utility programs.

Arizona Public Service (APS) Renewable Energy Incentive Program - Residential grid-tied solar PV systems are eligible for up to $1.95/watt. Off-grid solar panel systems are eligible for $2.00/watt.

Salt River project (SRP) EarthWise Solar Energy Incentive Program - Residential solar PV systems are eligible for $2.15/W-DC rebate.

Sulphur Springs Valley EC SunWatts Rebate Program - Solar PV systems up to 10kW that cost less than $75,000 are eligible to receive either production incentives or an up-front rebate. The production incentives pay per kilowatt-hour produced. The incentive rate is $0.108 to $0.202 per kWh. Homeowners who choose the up-front rebate will receive $3.00/W-DC.

Tucson Electric Power Sunshare Program - This Arizona solar rebate program offers residential customers up to $3.00/W-DC for grid-tied systems and $2.00/W-DC for off-grid. PV incentives cannot exceed 60 percent of the total solar installation costs.

Trico Electric Cooperative SunWatts Incentive Program - Arizona solar PV systems less than 10 kW can receive $3.00/W-DC. Solar incentives cannot exceed over 40 percent of the total home solar installation costs.

UniSource Energy Services Renewable Incentive Program - Grid-tied solar panel systems can earn up to $3.00/W-DC and off-grid solar systems are eligible for $2.00/W assuming they are less than 5 kW.

Most Arizona solar panel systems are eligible for net metering, which means any excess power your residential solar panels generate will be given back to you in the form of credit to pay for any future electricity used from the grid or a check.

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