Solar panels in Arizona: cost, payback and the rules that matter
Arizona homes pay 15.4¢ per kWh for electricity, the 28th highest of 51, up 0.9% in a year. A typical home needs 18 panels. With no federal tax credit they pay for themselves in about 17.3 yrs.
Four facts that decide solar in Arizona
1. The sun. One kilowatt of panels makes about 1,799 kWh a year in the median Arizona city, from 1,789 in Scottsdale to 1,823 in Yuma.
2. The price of electricity. Every kWh your panels make is worth what you would otherwise pay: 15.4¢ in Arizona today.
3. What your utility pays for exports. Arizona utilities credit exports at a Resource Comparison Proxy rate (APS ≈ 5.6¢/kWh for Sep 2026–Aug 2027). Source
4. Incentives. The 30% federal Residential Clean Energy Credit (IRC §25D) ended for systems whose installation is completed after December 31, 2025 (One Big Beautiful Bill Act, P.L. Arizona residential solar credit: 25% up to $1,000. Source
Arizona's homes
2,856,081 households; 67.4% own their home. 1,680,372 owner-occupied single-family houses: the main market for rooftop solar. The median home was built in 1992; 59.9% heat with electricity.
ACS 2020–2024 5-year estimates, U.S. Census Bureau.
Plan a specific Arizona home
Solar in every Arizona city with 50,000+ people
| City | Sun hrs/day | kWh per kW | Best tilt | Typical kW | Payback (NM) | Payback (NB) | Solar ¢/kWh |
|---|---|---|---|---|---|---|---|
| Phoenix | 6.6 | 1,794 | 33° | 7.6 | 10.4 yrs | 17.3 yrs | 8.3 |
| Tucson | 6.6 | 1,821 | 32° | 7.1 | 10.2 yrs | 16.8 yrs | 8.2 |
| Mesa | 6.6 | 1,792 | 33° | 7.6 | 10.4 yrs | 17.3 yrs | 8.3 |
| Gilbert | 6.6 | 1,796 | 33° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Chandler | 6.7 | 1,798 | 33° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Glendale | 6.7 | 1,795 | 33° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Scottsdale | 6.6 | 1,789 | 33° | 7.6 | 10.4 yrs | 17.4 yrs | 8.3 |
| Peoria | 6.6 | 1,796 | 33° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Tempe | 6.7 | 1,796 | 33° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Surprise | 6.7 | 1,799 | 33° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Buckeye | 6.7 | 1,805 | 33° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Goodyear | 6.7 | 1,806 | 33° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Yuma | 6.8 | 1,823 | 33° | 7.1 | 10.2 yrs | 16.7 yrs | 8.2 |
| Avondale | 6.7 | 1,804 | 33° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Queen Creek | 6.6 | 1,796 | 32° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Maricopa | 6.7 | 1,808 | 33° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Flagstaff | 6.5 | 1,801 | 35° | 7.6 | 10.3 yrs | 17.3 yrs | 8.3 |
| Casa Grande | 6.7 | 1,810 | 32° | 7.6 | 10.3 yrs | 17.2 yrs | 8.2 |
| Marana | 6.7 | 1,818 | 32° | 7.6 | 10.2 yrs | 17.2 yrs | 8.2 |
| Lake Havasu City | 6.7 | 1,820 | 34° | 7.6 | 10.2 yrs | 17.2 yrs | 8.2 |
| Prescott Valley | 6.5 | 1,795 | 33° | 7.6 | 10.4 yrs | 17.3 yrs | 8.3 |
NM = exports credited at retail (net metering); NB = exports at ~30% of retail (net billing). Systems sized to the Arizona average home. $3.00/W, cash, 25 years.
Rule changes that affect Arizona
All changes and deadlines →- Federal: In-service deadline for the lease/PPA solar credit · Tax credits
- Arizona: APS export rate falls 10% to about 5.6¢ per kWh · Export rules
- Federal: National data: solar prices fell to a median $3.60 per watt · Prices
- Federal: Construction-start deadline passed for the lease/PPA credit · Tax credits
- Federal: The 30% homeowner solar tax credit is gone · Tax credits
Questions about solar in Arizona
How much do solar panels cost in Arizona?
A 7.6 kW system, the size the average Arizona home needs, costs about $19,000 to $28,500 before incentives in 2026. Arizona residential solar credit: 25% up to $1,000.
Is solar worth it in Arizona?
In the median Arizona city, solar pays for itself in about 10.3 yrs if exported power earns the retail rate, or 17.3 yrs if it earns about 30% of retail. Arizona utilities credit exports at a Resource Comparison Proxy rate (APS ≈ 5.6¢/kWh for Sep 2026–Aug 2027).
Is there a solar tax credit in Arizona?
Arizona residential solar credit: 25% up to $1,000. The 30% federal credit ended for homeowner systems installed after December 31, 2025.
How many solar panels does a Arizona home need?
About 18 panels of 420 watts for the state-average 1,075 kWh a month. Sunnier cities need fewer: Yuma gets 1,823 kWh per kW a year, Scottsdale 1,789.