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Solar Incentives In Arizona

Renewable energy sources are more important than ever so the Federal and local Governments are promoting these cleaner sources of energy by reducing investment costs. These cost reductions go by the name of Solar Incentives and these allow Americans to affordably install photovoltaic panels on their homes.

Are There Solar Incentives In Arizona?

Yes! Many states in the U.S. offer solar rebates for home solar power systems, and fortunately, Arizona is one of them. (You can see the most updated information about the current state incentive level at the database of State Incentives for Renewable Energy (DSIRE) but we’ll give you an overview of what’s available today for home solar in Arizona below.

There is a lot of information and numerous advertisements where you’ll hear about tax credits, solar incentives in Arizona, how the government will pay for your solar system, and “free solar”. While solar is never free, it can feel free because of the savings. Below is the description of solar incentives available in Arizona.

  1. Federal Tax Incentives
  2. Arizona Tax Credit
  3. Export Rates
  4. Battery Incentives
  5. Bonus Incentive! (Perks for choosing Sunny Energy )

What Is Federal Tax Incentive?

Solar Incentives In Arizona

  • The investment tax credit (ITC), also known as the Federal Solar Tax Credit, allows you to claim a tax credit equal to 26 percent of the cost of installing a solar energy system on your federal taxes. This is a true reduction of your taxes, not just a deduction on income!
  • This 26% tax credit was due to expire at the end of 2020 and be replaced with a 22% federal tax credit in 2021.
  • Recently, Congress passed a bill that extends the solar incentive through the end of 2022 so that means homeowners can still get the full 26% Federal Tax Credit this year.
  • This incentive is causing solar companies to book up quickly so be sure to contact us soon so you can get installed in time for the hot summer months when electricity bills are at their highest.

2021 Arizona Solar Incentives (Arizona Tax Credit)

  • This is a 10% tax credit, capped at $1,000, that you can apply to your Arizona state taxes. Like the Federal tax credit, it’s a reduction of your taxes! As always, for any tax incentives, you’ll want to consult a tax professional to make sure you qualify.

What Are Solar Export Rates?

While not exactly an incentive, solar export rates are a big way to drive savings.

  • For APS customers, APS is mandated to compensate homeowners that export solar energy at a very attractive rate, which is sometimes higher than what they would otherwise pay for energy from APS. What does this mean?
  • This means that your APS bill will show a credit for exported energy, and some months your entire bill may be negative, allowing you to carry that credit forward to another month. That means instead of getting a bill, you’ll get a credit to use you on months when you use extra energy.
  • The current rate is available until at least September 2021. Customers who have installed before the next rate change will be grandfathered in for 10 years on the current, more favorable rate.

Battery Incentives

  • Let’s talk about battery incentives. For those of you with SRP, they are offering a rebate of up to $3,600 for those who install battery storage with their solar system.
  • APS customers will have a battery incentive offered sometime in the first half of 2021. This is expected to fill up fast, so getting prepared for it now is not too early.

Solar as a Home Investment

  • Home value is another consideration. According to Zillow, homes with Solar are worth 4% more than those without. That can be substantial, should you decide to sell your home.
  • Looking at this as a homeowner, a home that has energy bills thousands of dollars less each year is worth more – it makes a home with solar more affordable to own and live in!
  • But please do not confuse this with a SOLAR LEASE! Purchasing solar adds value to your home, but a solar lease does not. In fact, it can make a home more difficult to sell since some home buyers do not want to assume your lease.
  • A solar lease may be a good alternative for some homeowners who do not have taxable income to take advantage of the tax credits, but most of these incentives are not available if you lease your solar system.
  • The leasing company, not you, will benefit from the Federal and state tax credits, as well as any utility rebates. Plus, a solar lease does not add value to your home. Sunny Energy consultants can help you understand all financing options, including leases so that you can make a choice of what is right for you.
  • As always, I hope this helped you understand the available incentives. If we can help answer any questions or for a consultation, please give us a call or visit our website at There are also incentives available for Arizona homeowners going solar with Sunny Energy.
  • New interest rates are available as low as .99%. Terms are from 5 to 25 years, and qualification is easy and takes just minutes.
  • No-money-down financing
  • And for a limited time, we are offering no payments for 13 months
  • Finally, as I mentioned before, the 26% Federal Tax Credit has been extended! Our team will help you make sure you get all of the available incentives to help pay for your system.

Still have questions?