Electricity is relatively cheap in Arizona, but sunlight is abundant; in fact, there’s an average of almost 7 hours of peak daily sunlight in the state. So do solar panels make sense for your home?
Arizona residents paid an average rate of less than 15 cents per kilowatt-hour for electricity in 2023, according to data from the US Energy Information Administration. Different federal and state incentives can help make solar energy an even cheaper alternative to utilities, though. The biggest federal incentive is a major tax credit included within the Inflation Reduction Act, providing a 30% rebate on clean energy additions to your household.
Arizona has a number of local incentives that help make solar panel installation an easier choice as well. A robust net metering policy makes it cheaper to own solar panel systems in seasons with less sunlight, and the state has legislation exempting these additions to your house from contributing to property taxes.
Before you can make the decision to switch to clean energy, you need to know what company to contract with for solar panel system installation. Here are CNET’s favorite national solar companies and some local solar installers to consider.
Best solar panel companies in Arizona
Palmetto Solar
Best overall
Solar panels are typically low maintenance equipment, but they’re also unfamiliar. If you want to reap the benefits of solar but will have a bit more peace of mind if someone else is making sure it’s working, Palmetto might be a good fit for you. Just remember to add the cost of Palmetto’s monitoring service in to your payback period calculations.
EnergyPal
Most flexible
EnergyPal is more than just a middleman. It’ll handle your solar installation from beginning to end while also allowing you to benefit from its proprietary engine and competitive bidding process. The company offers a range of hardware for panels, batteries and inverters, has plentiful financing options and offers responsive customer service support.
Elevation
Whole home approach
Elevation’s focus on your home’s energy efficiency isn’t the norm in the industry. If you’re planning on addressing energy efficiency first, working with Elevation allows you to keep the whole process with one company. Elevation’s solar equipment comes from well-established and well-regarded companies. Elevation’s warranties on workmanship and weatherization could be a bit longer.
Tesla Solar
Most affordable
Tesla’s solar branch seems to be the least loved of Elon Musk’s ventures. Even Tesla’s Solar Roof seems to get more love.
If price is the thing you won’t budge on, consider Tesla. By all accounts, Tesla installs quality panels and makes the closest thing there is to a household name in solar storage: the Powerwall.
Where you might miss out is customer service. Discussion online seems to suggest Tesla’s service is a bit of a gamble.
Momentum Solar
All in-house installers
Momentum installs in 11 states without using subcontractors. While using in-house installers doesn’t guarantee a better experience, it does suggest you’re likely to get a more uniform experience from Momentum. The fact that Momentum backs its installations with a 25-year workmanship warranty hints at a strong belief in its crews’ ability. If Momentum is part of your search, consider the warranties against leaks that other companies offer. Momentum’s is five years, which isn’t the best.
Local Arizona solar panel installation companies
Founded in 1999, Arizona Solar Wave & Energy is a locally owned solar company operating in the Grand Canyon State. It provides services from designing to connecting your solar system with the utility company. The company’s solar systems come with a 25-year warranty.
Arizona Solar Wave ensures its designs and installation plans are clear and simple, so you know what service to expect. It also provides free repair and maintenance for the lifespan of the system.
Established in 2006, Sun Valley Solar Solutions is headquartered and operates in Arizona. It offers solar systems for residential and commercial buildings. Sun Valley Solar guides you through the entire process, from the roof inspection to powering your system. It works with you to provide the best fit for your budget and offers several financing options, including cash, loans, leases and home equity mortgages.
Sun Valley Solar Solutions includes a 10-year warranty for the quality of work and roof penetration. Its systems can also include solar batteries like the Tesla Powerwall and Generac PWRcell. Sun Valley has completed over 8,000 residential installations and has performed commercial installations for companies such as PepsiCo.
How to determine which solar company in Arizona is best for me
The best installer for your home is someone who has experience working with the type of solar project that you’re looking for. Make sure your installer has experience working on the type of roof that your home has, and the type of solar system you want installed, such as grid-tied or off-grid.
“As a homeowner, you also want to look for an installer that has North American Board of Certified Energy Practitioners certifications and the right licensing and bonding for their work,” said Ben Delman, a communications director with Solar United Neighbors, a clean energy nonprofit.
Reading online reviews can also help you get a better picture of an installer’s reputation. A few places to start your search for solar company reviews are Google, Yelp and Angie’s List. Delman recommends looking for solar companies that have at least 20 to 30 reviews. If you know someone who has solar installed on their home, ask them for installer recommendations, too.
Aside from certifications and reviews, there are some other things to look for in a solar company. A good installer, Delman said, will be able to:
- Provide you with good word-of-mouth references
- Clearly explain the project schedule and deadlines
- Define technical terms in an clear and easy-to-understand manner
- Be transparent about pricing and how financing works for your system
- Know the local permit requirements and the process for interconnection with the local utility company
- Understand and have experience with homeowners association restrictions and help you navigate through that process
A reputable installer should also be able to answer any questions you have, no matter how difficult your questions are. Don’t be afraid to ask for clarification on any project, system and pricing details. To get the best price possible, make sure to shop around for multiple quotes. Delman recommends comparing at least three quotes before picking a solar installer.
Cost of solar panels in Arizona
Here’s a look at the average cash price for a typical solar panel system in Arizona before factoring in tax credits incentives, according to data from FindEnergy.com.
Average cost of solar panels in Arizona
| Typical system size (kW) | Price per watt | Total installed cost | Cost after 30% federal tax credit | |
| Arizona | 5 | $2.81 | $14,050 | $9,835 |
| National average | 5 | $3.58 | $17,900 | $12,530 |
The following infographic visualizes the average total price, cost per watt and system size for solar panel systems in the United States, according to data from FindEnergy.com. The prices shown do not represent changes from tax credits or state solar incentives. If FindEnergy doesn’t have solar data for a particular state, it appears grayed out on the map.
Arizona solar panel incentives or rebates
While solar panels in Arizona can save you money on your monthly electricity bills, the upfront costs can be a deterrent. Thankfully, there are federal and state incentives to reduce the overall cost.
The federal government offers the Residential Clean Energy Credit (formerly known as the Investment Tax Credit) as part of the Inflation Reduction Act. This tax credit provides 30% of the total cost of a solar panel system as a credit on your federal income taxes.
The state of Arizona has additional state and local solar incentives. Find the list based on your ZIP code on the Database of State Incentives for Renewable and Efficiency. Here are a few to note:
Arizona solar incentives
| Program | Description |
|---|---|
| Net metering | Arizona residents can sell excess energy generated from their solar systems back to their electricity provider. |
| Property tax exemption | The addition of solar panels usually increases the value of your home. When this happens, property taxes can increase, too. Arizona has a property tax exemption in place to protect this increase for a solar installation. |
| Residential Solar and Wind Energy Systems Tax Credit | Receive 25% of the price of your solar system credited to your personal income taxes. The maximum credit is $1,000 and must be claimed in the same year as installation. |
| Solar and Wind Equipment Sales Tax Exemption | A 100% sales tax exemption for retail sales of solar energy devices installed by contractors. |
| Residential clean energy credit | Allows you to claim 30% of the total cost of your solar panel system back in federal tax credits. |
How solar-friendly is your state?
CNET recently ranked states based on their residential solar policies: the laws and regulations affecting consumer-level solar panel installation and adoption. These policies play a major role in determining how accessible and affordable a solar panel system is to the average resident.
Each state was evaluated through a methodology and scored based on eight categories. The final score was converted to a letter grade.
Here’s how your state scored on CNET’s solar policy test.
Arizona
Grade: D
Incentives available:
- State tax credit worth 25% of the cost of your solar system, up to $1,000
- State-governed net billing — solar buyback at the wholesale rate
- Solar panel systems fully exempt from property and sales taxes
- Low-income and community solar programs (local or utility-administered)
Strongest scoring categories:
Solar panel systems are fully exempt from both property and sales taxes in Arizona. While net billing gives you crummy energy buy back rates, it’s still better than nothing.
Categories to improve:
The net billing policy and the low-income and community solar programs only being offered at a local-level rather than across the state are both half measures in their respective categories.
Solar financing options in Arizona
There are several ways to pay for solar panels in Arizona, including cash, power purchase agreements, solar loans or leases. Each option has its advantages and disadvantages. Explore the payment options to determine what works best for you.
- Cash: No interest or loan fees, but greater upfront costs. You would be eligible to apply for the Residential Clean Energy Credit.
- Personal loan: You can also borrow the money through a personal loan. The main difference between a personal loan and a home equity loan is that a personal loan is typically unsecured. That means your house isn’t at risk. The downside is they tend to have shorter terms and higher interest rates than home equity products.
- Home equity: You don’t have to use a loan from your solar company. Financial institutions offer home equity loans and lines of credit (or HELOCs) that are commonly used for home improvement projects. These loans can be used for basically any purpose, and they may be a good fit for your solar project. Shop around and make sure you’re getting the best deal.
- Power purchase agreement: Solar company owns and provides maintenance on the solar panels. You only pay for the energy used. Ineligible for solar tax credits and incentives.
- Solar lease: Pay a fixed monthly price, but the company owns the panels. Ineligible for solar tax credits and incentives.
- Solar loan: Easy to apply, not as expensive upfront, but can result in high-interest fees.
Paying with cash or solar loans provides a larger return on your investment because you pay upfront and can claim tax credits. PPAs and solar leases are best for those who do not have the upfront capital, do not qualify for loans or rent their home. Remember that solar leases and PPAs do not qualify for tax credits and other green energy incentives.
Installation factors to keep in mind
Setting up solar panels can cost thousands of dollars. Before saying yes to solar, there are a few things to consider.
- Are you a homeowner? Homeowners can make solar decisions for their homes, but renters are typically not allowed to change the property without a landlord’s consent. There are still solar options for renters, such as community solar programs, where you subscribe to services like Arcadia and receive solar power from nearby panels.
- Can you cover solar panels under your current home insurance? Check with your homeowner’s insurance company to ensure your policy covers solar panels.
- Do you have an HOA or a neighborhood association? Arizona law states that an HOA may not prohibit the installation of solar panels. Check with your HOA or other neighborhood association before installation, as it may still have rules and regulations regarding solar devices.
- What is the condition of your roof? Consider the age, size, slope and tree cover of your roof. Older roofs may need maintenance before installing solar, which can be an added cost. The Department of Energy says solar panels work best on roofs sloped between 15 and 40 degrees and facing the south. Solar installers will assess your roof before installation.
- Where is your home located? While solar panels still work in partially shaded areas, they benefit most from direct sunlight for at least four hours a day. If your solar system is shaded most of the day, it will not generate as much electricity for your home.
Read more: Just looking for an emergency backup? Check out portable solar panels and solar generators.
How we found the best solar companies
The companies we listed above as “the best” are curated from CNET’s best solar companies list. Companies making the best list are scored on the equipment, warranties and customer service they offer. Then, we make sure these recommendations are available in your state. You can read a full breakdown of how we review solar companies here.
Companies listed under the local installers were chosen in a less rigorous way. We chose them because they offered something unique or notable to customers in the state, they seemed well-regarded by internet reviewers or because they were one of the few installers we could find information on in the state.
Whether we’ve completed a full review on a company or not, it’s always a good idea to get multiple quotes from different installers before choosing a company.
Arizona solar power FAQs
Should I go solar in Arizona?
Yes. If you can, go solar to save money and power your home with green energy. Arizona is one of the sunniest states in the US, making it a prime place to try solar energy. Powering your home with solar energy can lead to thousands in savings on electricity bills. If you’re still on the fence about solar, review installation factors to consider and research potential tax credits and rebates to offset the cost of a solar system.
What are the advantages of solar power in Arizona?
The advantages of solar energy include saving money on electricity, increasing your home’s value and using a renewable energy source. Systems connected to the grid can receive credits on electricity bills for excess energy generated by your solar panels. Installing solar panels can also increase the value of your home. Solar panels produce energy from a renewable source (the sun), whereas other energy sources like coal and fossil fuels are limited.
How much does a solar system cost?
The price can vary depending on size, equipment, installation and other factors. Many federal, state and local incentives exist to reduce overall costs. Solar companies in Arizona offer customers many financing options, including cash payments, loans and leases. They will work with you to determine the best plan and financing option for your budget.
Are all solar panels the same?
Not all solar panels are the same. Solar panels can differ from each other in efficiency ratings, size and maximum wattage. Other solar alternatives, like solar shingles, will have varying technical ratings as well.
Source: CNET
