Arizona solar is cheap to install, but the payback depends on who buys your extra power and when you use it. In our example a typical home system pays for itself in about 21 years on APS, where exports earn 5.554 cents per kWh. Using 60% of the power at home while the sun is up, instead of 40%, cuts that to about 18 years. On SRP, exports earn just 1.87 cents per kWh.
Typical payback on APSAbout 21 years
40% vs 60% home useAbout 18 to 21 years
Typical owned 9.33 kW Arizona system at $23,885 cash (EcoGen Solar Cost Index, September 2026), less the $1,000 state tax credit, on the APS TOU-E plan. With 60% used at home: about 17.6 years. Assumes 40% of the solar power is used at home as it is made, 60% sent to the grid, and $307 a year in owner costs, including APS’s grid access charge. See the math.
- Utility and plan: each Arizona utility pays its own export credit.
- Application date: at APS and TEP the credit in force when the request goes in is fixed for 10 years.
- Home use: power used as it is made saves the full price.
2026 rules: new home systems get no 30% federal homeowner credit (IRS). Arizona’s own solar tax credit tops out at $1,000. New APS applications since September 1, 2026 earn 5.554 cents per kWh for exports; new TEP applications since October 1, 2026 earn 4.62 cents per kWh.
How we checked this guide
Export credits come from the five utilities’ tariffs, tax rules from Arizona statutes, and the electricity price from the U.S. EIA. Assumed numbers are labelled.
The writer and checker shown above are EcoGen staff. EcoGen is paid when homeowners request quotes, which is explained beside the quote form. Read our editorial standards.
Sun is not the question in Arizona. Fit is.
Arizona has strong sun, big cooling loads and low install prices, yet it still produces disappointed solar owners. What matters is when your panels make power, when your home uses it, and how your plan prices the gap. Read each row across.
Your utility and plan
Worth a closer look
The quote names your utility and plan, and shows the export credit as its own number.
Pause and check
One blended price for every kWh, or exports valued at full retail.
Check next: the plan name and the credit per exported kWh.
When you use power
Worth a closer look
Someone is home by day, or the air conditioner runs hard while the sun is up.
Pause and check
Most use falls after dark, so much of the output leaves for a few cents.
Check next: your last 12 months of hourly usage.
Filing date at APS and TEP
Worth a closer look
The interconnection request goes in soon, and the install fits inside 180 days at APS.
Pause and check
Delays push the request past the yearly reset, when the credit for new applicants can drop.
Check next: the filing date and the credit it locks in.
Roof and price
Worth a closer look
A sound roof, and a cash price near the Index’s $23,885 for 9.33 kW ($2.56 per watt).
Pause and check
An old roof, especially tile, that will need the panels lifted for repairs.
Check next: roof age and the cash price next to the financed total.
Same roof, two utilities: the payback math
A kWh (kilowatt-hour) is the unit on your power bill. An export credit is what your utility pays for each kWh your panels send to the grid. Simple payback is the years your savings take to cover what you paid: net cost divided by yearly savings. Here is the typical Arizona home system in APS territory.
- Cash price
- $23,885
- Confirmed incentives
- $1,000
- Year-one production
- 16,691 kWh
- Used at home / exported
- 40% / 60%
- APS off-peak energy charge
- $0.1235/kWh
- Export credit
- $0.05554/kWh
- Owner-cost allowance
- $307/yr
- Used-at-home value
16,691 × 40% × $0.1235$825/yr - Export value
16,691 × 60% × $0.05554$556/yr - Yearly savings after owner costs
$825 + $556 − $307$1,074/yr - Simple cash payback
($23,885 − $1,000) ÷ $1,074about 21.3 years
Inputs: the EcoGen Solar Cost Index typical Arizona system (9.33 kW, $23,885 cash, September 2026; 1,789 kWh per kW a year), less the $1,000 state tax credit. Exports earn the APS rate for applications from September 1, 2026. Home use is valued at the APS TOU-E off-peak energy charge, about 12.35¢ before adjustors (effective March 8, 2024). On winter weekdays from 10 a.m. to 3 p.m. it is 3.495¢, so winter savings are lower; a forecast for your home needs your hourly usage. Owner costs: $279.90 ($30 per kW, including a reserve for a new inverter) plus APS’s grid access charge of $0.242 per kW a month ($27.09 a year), $306.99 in all. Our assumption: 40% of the solar power used at home as it is made, 60% sent to the grid. No battery.
Now keep the same house on APS and raise its home use from 40% to 60%, as in a home where someone is in during the day.
| Scenario | Home use | Export value | Yearly savings | Simple payback |
|---|---|---|---|---|
| 40% home use | 40% | $556 | $1,074 | about 21.3 years |
| 60% home use | 60% | $371 | $1,301 | about 17.6 years |
Both cases value home use at the off-peak price, so winter super off-peak hours make the real saving lower. Your utility matters too: SRP’s main solar plans pay 1.87 cents per kWh for exports, about a third of the APS credit, so a home there that sends out most of its power waits longer. SRP’s own prices differ from APS’s, so we do not apply the APS math to SRP.
Test your own Arizona plan
The tool starts with the APS case above. Enter your quote’s price, your plan’s export credit and your home-use share, then press Calculate. Nothing you enter is sent anywhere.
Example result
about 21.3 years
simple cash payback
- Used-at-home value
- $825/yr
- Export value
- $556/yr
- Owner costs
- −$307/yr
- Yearly savings
- $1,074/yr
- Net cost
- $22,885
Starts with the APS case above. Flat first-year values; rates, panel wear and repairs will change the result. No battery is included.
What each Arizona utility pays for extra power
APS closed full net metering, where each exported kWh cancels one you buy, to new customers on September 1, 2017. Homes already on it keep it for up to 20 years. New systems earn an export credit well below the retail price.
Used at home: 6,676 kWh. Each one replaces power you would have bought, so it saves the full variable rate ($0.1235 here).
Sent to the grid: 10,015 kWh. These earn whatever your utility pays for exports ($0.05554 here). That can be far less.
| Utility | Export credit for new systems | How long it holds |
|---|---|---|
| APS | 5.554 cents per kWh, applications September 1, 2026 to August 31, 2027 | Fixed for 10 years from connection |
| SRP | 1.87 cents per kWh on E-16 and E-28 | Reset each May, for every home on the plan |
| TEP | 4.62 cents per kWh, applications since October 1, 2026 | Fixed for 10 years from connection |
| UNS Electric | 5.51 cents per kWh, applications since October 1, 2026 | Fixed for 10 years from connection |
| Trico (co-op) | 3.124 cents per kWh | Fixed for 10 years; a $3.38 monthly data charge applies |
Each utility’s payback needs its own home-use prices and solar charges, so we work the numbers only for APS. APS, TEP and UNS Electric may cut the rate for new applicants by no more than 10% a year. SRP’s older E-13 plan pays 3.45 cents per kWh but ends in November 2029.
Get quotes that name your Arizona rate plan
Ask each installer which utility credit and price plan its savings figure uses, and the date that credit depends on.
Solar providers that serve your area may contact you, and they pay EcoGen for the introduction. How we make money.
How your rate plan changes the value of home use
APS solar homes must pick a time-of-use plan, where power costs more from 4 p.m. to 7 p.m. on weekdays; one version adds a demand charge, a fee based on your busiest hour in that window. On TOU-E, APS adds a grid access charge of $0.242 per kW a month for solar homes: about $27 a year at 9.33 kW, included in our owner costs. Panels peak at midday, when power is cheaper, so our example values home use at the off-peak energy charge, about 12.35¢ before adjustors. On winter weekdays from 10 a.m. to 3 p.m. that price is 3.495¢, so winter savings are lower.
At SRP, plan E-16 bills a demand charge for your busiest weekday evening moments; E-28 has none. Panels do little after sunset, so ask for your bill before and after on your own plan.
The state layer: small, steady and written into law
- Tax credit. The state credit is 25% of the system’s cost, capped at $1,000 per home across all years. On the typical system 25% would be $5,971, so the cap applies. Claim it on Arizona Form 310; unused credit carries forward up to 5 years.
- Sales tax. Under A.R.S. 42-5061(M), solar devices are deducted from the sales tax base when the seller is a registered solar retailer.
- Property tax. Under A.R.S. 42-11054, a system built mainly for on-site use adds no assessed value.
- HOA rules. Under A.R.S. 33-1816, a planned community cannot ban solar.
Batteries earn utility payments of their own: APS Storage Rewards pays $110 per kW for the average power a battery gives from May 1 through October 31, and TEP says a typical battery earns up to $720 a year. Price any battery on its own line.
Seven lines to find on an Arizona quote
Most bad Arizona outcomes were priced wrong on day one. A quote missing these lines cannot back up its payback.
- Utility, plan and export credit. Named on the quote, with the credit per kWh as its own line.
- Filing date for the application. At APS and TEP it sets the credit you keep for 10 years.
- Home-use share from your usage. Built from your hourly data, not a default.
- Demand charge handling. How the plan bills your evening peak, if it has one.
- The state credit at $1,000. Not 25% of the price. It is claimed on Arizona Form 310.
- Sales tax line. A registered solar retailer should not charge state sales tax on the equipment.
Compare Arizona solar quotes
Ask each installer to write down your utility’s export credit, your price plan and the filing date. Enter your ZIP code to request quotes from solar providers that serve your area.
How EcoGen is paid
EcoGen America does not sell or install solar. When you request quotes, we pass your request to solar providers serving your area, and they pay us for the introduction. Providers can include installers, solar marketplaces and lead exchanges, and more than one may contact you. You never pay us. This is not an interconnection application to your utility.
Keep reading on Arizona solar
- Arizona solar incentives: the tax credit and each utility’s rate
- What solar costs in Arizona
- Free solar panels in Arizona: what $0-down offers really mean
- Are solar panels worth it? The national guide and payback calculator
All 51 state guides
Arizona solar payback questions
Are solar panels worth it in Arizona?
They can be, if your plan and your usage line up. In our example a typical owned system pays back in about 21 years on APS, or about 18 if 60% of its power is used at home. Homes that use most of their solar power as it is made do better. Ask each quote for your plan and its export credit.
Is solar worth it in Arizona without net metering?
It can be. APS closed full net metering to new customers on September 1, 2017. New systems now earn a few cents per exported kWh: 5.554 cents per kWh at APS, 4.62 cents per kWh at TEP, 1.87 cents per kWh on SRP’s main solar plans. Power you use at home still saves the full price.
Do I need a battery for solar to pay in Arizona?
Not always. A battery moves midday power into the evening, when time-of-use prices are high, so it helps homes that use most power after dark. Judge it as its own purchase. APS pays $110 per kW and TEP $120 per kW through their battery programs; we found no SRP payment.
Why are some Arizona solar owners disappointed?
Usually the quote did not match the bill. It used one blended price, valued exports at the full retail price, or left out a demand charge. On SRP’s main solar plans exports earn 1.87 cents per kWh, so a system that mostly exports pays back slowly.
Does extreme heat make solar less worth it in Arizona?
Hot panels make a little less power on the hottest afternoons, so ask the quote to show its production estimate and losses. Our example uses 1,789 kWh per kW a year. Heat also runs your air conditioner while the sun is up, which raises your home-use share.
How fast does solar pay back in Arizona?
In our example, a typical 9.33 kW system at $23,885, less the $1,000 state credit, pays back in about 21.3 years on APS with 40% of the power used at home. Using 60% at home cuts that to about 17.6 years. Rerun it with your own plan’s prices.
Sources, method and corrections
The example uses the EcoGen Solar Cost Index typical Arizona system (September 2026), the $1,000 state tax credit and each utility’s published export credit. Two inputs are our assumptions, not measured values: 40% of the solar power is used at home as it is made and 60% is sent to the grid, and owner costs are $30 per kW a year ($279.90, including a reserve for a new inverter) plus APS’s grid access charge ($27.09). The 40/60 split is a planning assumption based on home-use research, not a measured Arizona average. Home use is valued at the APS TOU-E off-peak energy charge before adjustors. Simple payback uses flat first-year values and counts the tax credit at the start. The calculator runs in your browser and sends nothing.
Updated October 2026: 40% home use and 60% exports, owner costs of $30 per kW a year plus the APS grid access charge, and the APS off-peak price for home use instead of the state average.
Spotted an error? Tell us through our corrections and feedback process.
- APS: Rate Rider RCP (export credit) (export credit, 10-year lock, 180-day rule)
- APS: TOU-E rate plan (off-peak and winter super off-peak prices, grid access charge; effective March 8, 2024)
- APS: Understanding solar
- SRP: Standard electric price plans (E-16, E-28 and E-13 export credits)
- TEP: Statement of Charges (export credit since October 1, 2026)
- TEP: Rider R-14
- UNS Electric: Statement of Charges
- Trico Electric Cooperative: Schedule NM1
- APS: Storage Rewards
- TEP: Energy Storage Rewards
- Arizona Revised Statutes 43-1083: Credit for Solar Energy Devices
- Arizona Revised Statutes 42-5061: sales tax deduction for solar devices
- Arizona Revised Statutes 42-11054: property valuation of solar devices
- Arizona Revised Statutes 33-1816: HOA rules
- U.S. EIA: average residential electricity price by state (August 2025 to July 2026)
- IRS: Residential Clean Energy Credit
- EcoGen Solar Cost Index, September 2026: what solar costs in Arizona
