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Solar Panels Arizona

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Solar Panels Arizona
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Arizona is the sunniest place in the United States and it has the two most sunny cities on the planet. This makes getting solar panels in Arizona a wise decision.

Yuma, Arizona is the sunniest city on earth. It has 11 hours of sunlight per day in the winter and 13 in the summer. Yuma has a total of 4,015 hours of sunshine per year.

Phoenix, Arizona is the second sunniest city on earth. Phoenix has 300 days of clear, sunny skies and 3,872 hours of sunshine per year.

The abundance of sunshine makes residential solar and renewable energy an excellent choice in the Grand Canyon State. The amount of energy a rooftop solar system generates is directly related to the amount of sunlight that hits your panels. Thus, solar panel systems in Arizona will produce more energy than panels in locations with overcast weather and shorter days.

The price of solar panel installation continues to drop. Also, the current solar incentives make saving money with clean energy easier than ever!

Arizona Solar Incentives, Rebates, and Tax Credits

There are certain programs that assist homeowners in purchasing solar panels in Arizona.

The Federal Solar Tax Credit offers homeowners a tax credit equal to 30% of the total system cost. The Arizona Solar Tax Credit is 25% of the total system cost, or $1,000, whichever is greater. Visit our page on the Solar Tax Credits for more information.

Any home value increase from a solar project is exempt from your property taxes. Also, solar equipment is exempt from the 5.6% state sales tax.

Generac and Arizona Public Service (APS) are offering a $4,000 rebate on 18 kilowatt-hour (kWh) Generac batteries. However, this rebate will only last for a limited time.

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Solar Arizona – Net Metering and Net Billing

Net Metering is the ability to sell back excess electricity to the utility company at the retail rate. When solar panels in Arizona produce more electricity than the home needs, the excess is sent to the utility grid. Different utility companies buy back this excess energy at different rates.

The two largest electric utility companies in Arizona are Arizona Public Service (APS) and Salt River Project (SRP). APS covers many counties in the state of Arizona while SRP is only in the Phoenix metropolitan area.

Arizona Public Service (APS)

Unfortunately, APS does not offer Net Metering for Arizona homeowners. Instead they offer a Net Billing program, which credits customers for surplus energy below the retail rate. APS calls this the “Solar Export Credit”, and it reduces the amount of the monthly APS bill. This is also known as the Buy Back Rate.

From September 1, 2022 through August 31, 2022, APS will pay their customers 8.465 ¢ per kilowatt-hour (kWh) for exported energy. APS typically lowers the amount of the Solar Export Credit every year on September 1st.

Salt River Project (SRP)

SRP customers with solar panels in Arizona can use two post-solar rate plans that offer a version of Net Metering. The Customer Generation and Average Demand Plans credit customers for every kWh they export to the SRP grid. The amount of electricity sent to the grid is subtracted from the amount of electricity drawn from the grid. SRP customers are only billed for the “net” difference.

Solar Arizona
Arizona Solar

Arizona Solar Facts

According to the Solar Energy Industries Association (SEIA), Arizona solar generation is fifth in the United States at 5,984 megawatts. There is enough Arizona solar production to power 945,767 homes. However, the solar industry in Arizona still has a massive potential for growth. Currently, only 0.97% of the state’s electricity is generated from solar.

Here are some additional facts about solar in Arizona:

  • Solar Jobs in 2021: 8278
  • Solar Companies in State: 296 (57 Manufacturers, 138 Installers/Developers, 101 Others)
  • Total Solar Investment in State: $13.9 billion
  • Price Drop: 53% over the last 10 years
  • Growth Projection and Ranking: 5,342 MW over the next 5 years (ranks 9th)
  • Number Of Installations: 228,976

Large Arizona Solar Projects

The Solana Generating Station is an Arizona solar power plant near Gila Bend, about 70 miles (110 km) southwest of Phoenix. Completed in 2013, it was the first solar plant in the U.S. to use molten salt thermal energy storage. It generates 250 megawatts of electricity which can power 65,000 homes.

Some large Arizona retailers have installed solar, like Albertsons, Bookmans, Macy’s, and Body Sculpting Center. One of the largest retail solar projects in Arizona is the Macy’s located in Goodyear, Arizona.

The Mesquite Solar 2 project in Tonopah, Arizona was completed in 2015. It generates 100 megawatts and can power 14,995 homes.

Arizona Solar Policy

The advancement of Arizona solar policy has been slow and turbulent, mostly because Arizona is a traditionally conservative state. Traditionally liberal states, such as California, have adopted solar energy much more rapidly. Conservative states tend to have governmental and public resistance to policies that encourage solar growth.

Resistance comes because adoption of solar energy can damage the profits of traditional electricity generation industries. Further, a close relationship between Arizona politicians and the utility industries stalls the growth of Arizona solar. Despite this, the growth of solar panels in Arizona has steadily increased over the years. However, there is still much room for improvement.

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Notable Arizona Solar Policy Changes

Here is a summary of the historical solar policy changes in Arizona:

  • 2000: The Solar Equipment Sales Tax Exemption was established.
  • 2001: The Residential Arizona Solar Tax Credit was created.
  • 2002: The first Renewable Portfolio Standard (RPS) was created, which mandated Arizona utilities to generate 0.4% of their power from renewables.
  • 2006: The Arizona Corporation Commission expanded its Renewable Energy Standard (RES). This mandated Arizona utilities to generate 15% of their power from renewables by 2025. Half of the requirement must come from residential installations.
  • 2008: APS introduced Net Metering, which made residential solar a smart investment in Arizona.
  • 2014: APS introduced a Net Metering charge, which took solar progress backwards.
  • 2016: APS discontinued retail Net Metering in favor of a Net Billing mechanism. This was another backwards step for solar progress.
  • 2018: Proposition 127 was introduced to Arizona voters. It would have required Arizona utilities to be 50% renewable power by 2030, but it lost.

Going Solar In Arizona

The process of installing solar panels in Arizona is very similar across the state. We will discuss the arizona solar panel purchasing process below.

Solar Panels AZ – Finance Companies

The solar programs in AZ almost always use the same national finance companies. These companies make AZ solar panels affordable by offering loan and lease options that allow customers to pay over time. Further, these finance companies are backed by major global banks, so funding is ensured for everyone that qualifies.

Arizona solar programs typically utilize the following solar financing companies: Concert Finance, Dividend Finance, GoodLeap, Mosaic, Sunlight Financial, and Sunnova.

Licensed AZ Solar Installers

Purchasing solar systems in Arizona should always involve a licensed contractor. Be aware that some companies installing solar are not registered with the Arizona Registrar of Contractors (AROC). So, you should always check the AROC Website ensure the installer you are dealing with is licensed.

The AROC protects consumers by allowing them to lodge complaints against contractors. If the solar installer fails to complete your project, or does it poorly, you can file a complaint with the AROC. Then, the installer will be forced to fix the defective installation or risk losing their license.

Home Solar Arizona – Sales Organizations

The solar programs in Arizona often include sales organizations that act as middlemen between the solar installers and the customers. These independent companies are a benefit to Arizona consumers because they can offer lower pricing than the solar installers themselves.

This is true because solar installers have a large amount of overhead costs. So, the salespeople working for the solar installers have to charge customers more to cover the extra overhead.

Salespeople in independent sales organizations have little to no overhead. They receive no salary or benefits, and they often do not have an office location. They have partnerships with the solar installers that allow them to offer lower pricing to customers.

Residential Solar Panels Arizona – Solar Platform Companies

Sometimes there is a fourth party involved in the sale of Arizona solar panel systems. These companies offer an online platform to independent solar salespeople and organizations. The platform allows salespeople to install solar in multiple U.S. states, work remotely, and access several finance options for their customers.

It connects the salesperson and the customer with a reputable installer in Arizona. The platform companies are organized with the multi-level marketing (MLM) or “pyramid” model. So, salespeople that are members of the platform can recruit other salespeople to join their “downstream”. Thus, any solar systems sold by a salesperson in the “downstream” will pay commission to everyone that is “upstream”.