Solar in Arizona costs about $2.39 per watt, tied with Florida for the lowest in the country, so the typical 7.21 kW system runs about $17,232 before incentives. The catch is that Arizona has no net metering: exports earn 3.45¢ to 6.171¢ against a 15.72¢ retail rate, so when you use your power decides your payback more than the price does.
See which export rate your address gets
APS, TEP and SRP each pay a different rate for the power you send back. Your ZIP code shows your utility, local prices and installers.
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15.72¢ kept or as little as 3.45¢ sold: the Arizona solar trade
Arizona retired retail net metering for new customers in 2017-18. The gap between the retail rate you avoid and the export rate you are paid is the most important number in any Arizona solar decision.
Power you use as it is made
Every kilowatt-hour you use at the moment it is produced avoids the retail rate. 15.72¢ is the statewide average; your own plan’s rate may differ.
Power you send to the grid
Exports earn your utility’s export credit instead: 3.45¢ on SRP, 5.13¢ on TEP and 6.171¢ on APS.
The cheapest lever is your scheduleRun the pool pump, laundry and pre-cooling during production hours. It costs nothing and raises the share of power you use yourself.
Why SRP homes should shift the hardestOn SRP, each kWh moved into production hours saves 12.27¢ (15.72¢ minus 3.45¢), against 9.55¢ on APS: about 28% more. SRP exports earn only about 22% of the retail rate.
APS, TEP and SRP each set their own Arizona export credit
There is no single Arizona export rate. Each utility sets its own credit, and its terms matter as much as the rate.
APS steps down by trancheAPS’s Resource Comparison Proxy rate can fall up to 10% per tranche. The 6.171¢ tranche covered applications through August 31, 2026, and the next step-down was expected September 1, 2026. Interconnecting under a tranche locks its rate for 10 years, so confirm which rate your application gets.
SRP has the weakest export valueSRP’s 3.45¢ is the lowest export credit in the state. That pushes SRP homes hardest toward using their own power.
Your daytime schedule sets Arizona payback: 10 years or 15
The share of your production you use yourself is worth more to your payback than panel brand, inverter choice, or even a fair price. Here is the same 7.21 kW APS-territory system at three realistic self-use levels.
A battery is its own decisionA battery raises self-use, which is what low export rates reward. But it adds cost those same rates then have to justify. Price the system with and without storage and compare the two paybacks.
Tied for the lowest price per watt: Arizona systems by size
At $2.39 per watt, Arizona prices sit 17.6% below the national average. Scale, competition and easy roofs (single-story homes, no snow load) keep installs cheap. See where Arizona lands in the full national pricing picture.
Gross prices before incentives. Real quotes vary by roof, equipment and installer.
Where fair Arizona bids cluster$2.39 per watt is where fair Arizona bids cluster. A quote well above it should come with a specific engineering reason.
Why 7.21 kW is typicalArizona gets 6.66 peak sun hours, the best in the country, and each installed kW makes about 1,789 kWh a year. A 7.21 kW array makes about 12,900 kWh, enough to cover the average home’s 1,075 kWh a month on paper.
Size an Arizona system to your usage, not your roof
Under net billing, oversizing is expensive. Production beyond what your home absorbs becomes cheap exports that take decades to repay their own hardware.
A system at 80% to 100% of your yearly use, with deliberate daytime load-shifting, beats a bigger array feeding cheap exports.
Ask for modeled self-consumptionAsk every bidder to show modeled self-consumption for your household schedule, not just yearly production.
Four signs an Arizona solar deal is the wrong buy
Cheap panels do not make every Arizona system a good one. Hold off if one of these is true:
- Nobody is home in daylight, and you cannot shift load. At 30% self-use the modeled payback stretches toward 15 years. Timers, smart thermostats or a schedule change should come before a contract.
- The math counts the federal credit. The 25D residential credit is $0 for host-owned systems whose installation is completed after December 31, 2025. Residential PPAs are restricted in Arizona, so the third-party route to the remaining 48E credit is largely closed to homeowners here.
- The quote is sold on export income. A proposal that values exports at retail, or projects income from overproduction, is modeling a tariff Arizona has not offered since 2017.
- You may not stay long. A 10 to 15 year modeled payback needs either a long stay or a buyer who values the locked export rate. Plan for one or the other.
Get quotes sized for self-use, not exports
Your utility decides your export rate, and your schedule decides your payback. Enter your ZIP code and we will start from both.
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Arizona against the rest of the country
Frequently asked questions
How much do solar panels cost in Arizona in 2026?
Arizona is the cheapest solar market in the country at $2.39 per watt installed as of March 1, 2026. The typical 7.21 kW system runs about $17,200 before incentives.
Does Arizona have net metering?
No. Arizona closed retail net metering to new customers in 2017-18. Exports now earn per-utility credits: about 6.171¢ per kWh at APS, 5.13¢ at TEP, and 3.45¢ at SRP, all well below the 15.72¢ average retail rate.
What is the APS export rate deadline in 2026?
APS’s current export credit of 6.171¢ per kWh covered applications through August 31, 2026 (that window has now closed; ask APS for the current rate), and is locked for 10 years from interconnection. The next tranche is expected September 1, 2026 and can be up to 10% lower.
What payback should I expect from solar in Arizona?
Modeled payback on a typical APS-territory system ranges from about 10 years at high self-consumption to about 15 years if most production is exported. How much of your own power you use as it is produced matters more than any other factor.
Is a battery worth it in Arizona?
Sometimes. A battery raises self-consumption, which is exactly what Arizona’s low export rates reward, but it adds cost those same rates must then justify. Price the system with and without storage and compare the two paybacks directly.
How we calculate these costs
Cost figures use Arizona’s entry in the EcoGen Solar Cost Index (v2 method), $2.39 per watt as of March 1, 2026. Payback is modeled with no federal residential credit for host-owned systems, exports at each utility’s published credit rate, rate growth at the state 5-year average of 3.71%, 0.5% yearly panel degradation and a 25-year horizon. Sources were accessed between June 10 and August 15, 2026, unless another date is listed.
Sources (9)
- Arizona Corporation Commission / APS, Rate Schedule RCP, Decision 81439 (accessed June 11, 2026): aps.com
- Tucson Electric Power, Rider R-14, Decision 81488 (accessed June 11, 2026): tep.com
- Salt River Project, Residential Solar Export Credit Plans, effective November 2025 (accessed June 11, 2026): srpnet.com
- EIA, Electric Power Monthly, Table 5.6.A, March 2026 edition (accessed June 10, 2026): eia.gov
- EIA, Form EIA-861 Annual Electric Power Industry Report, 2024 (accessed June 10, 2026): eia.gov
- U.S. Census Bureau, American Community Survey, 2024 (accessed June 11, 2026): census.gov
- IRS, One, Big, Beautiful Bill Provisions, Public Law 119-21 (accessed August 15, 2026): irs.gov
- DSIRE, Third-Party Solar PV Power Purchase Agreement Policies, May 2026 (accessed August 15, 2026): ncsolarcen-prod.s3.amazonaws.com
- Arizona Registrar of Contractors, License Classifications (accessed August 15, 2026): roc.az.gov
