Cost of solar panels in Arizona

How much do solar panels cost in Arizona?

Installing residential solar panels can cost between $10,000 to $30,000 or more, although individual costs vary significantly. In Arizona, you can get set up for less than $20,000 after rebates and incentives. On the higher end, Patrick in Tucson said his system cost $36,000, and Simin in Scottsdale paid over $40,000 for a large solar panel system.

The good news is the cost to go solar in Arizona has fallen 54% over the last 10 years, according to the Solar Energy Industries Association.

“When solar first came out, it was very expensive,” Dawn in Mesa said. “But for the price we got, it's an easier sale.”

Average cost by system size in Arizona

Are solar panels worth it in Arizona?

We’ve talked to hundreds of solar customers in Arizona, and most are satisfied with their decision to go solar.

Ray in Queen Creek installed 18 solar panels on his 2,706-square-foot single-unit home in 2022. He went through Sunrun, and the whole setup cost $14,000 after government incentives and Costco rebates.

When we followed up with Ray to ask about his savings since switching to solar, he said his system consistently generates more than 1,000 kilowatts (kW) per month — more than 50% of his energy needs.

Over 25 years, solar panels can save $23,891 in Arizona

As of July 2023, his electricity bill is down to about $100, even after 23 days of triple-digit temperatures — a significant reduction compared to his neighbor’s $600 bill. In the cooler months, his bill drops to less than $30 (he uses gas for heating and cooking).

“My neighbors can’t believe what I’m paying,” Ray said.

He told us about a few hiccups, such as reductions in government incentives, difficulties with HOA and county approvals, and the need to replace a couple of damaged panels. Despite these challenges, he emphasized solar energy's advantages, especially for Arizona.

His advice to other Arizonians going solar: Do your research, especially regarding the choice of solar panels and the warranties offered. He also recommends owning over leasing: “What happens if you lease, and you sell your home? It’s a pain in the butt — there are lots of issues.”

Cost factors of going solar in Arizona

The cost of hiring professionals to install your solar system varies based on on the size and complexity of the project. How much you pay for your solar panels depends on a range of factors, including the size of your system and the quality of your panels.

Equipment costs

Solar panels are the most significant part of the overall expense, with the type, brand and efficiency affecting the overall price. Your total costs also include other necessary equipment, such as inverters, mounting and racking, and often monitoring systems or batteries for energy storage. Like almost anything else, quality equipment costs more, but the upfront expense is usually worth it.

Otherwise, you might have to pay for pricey upgrades in the future, which adds up quickly, especially if you have to replace a solar inverter. A solar reviewer in Peoria told us how frustrating this is after already spending “tens of thousands of dollars” on a system.

» COMPARE: Most efficient solar panels

System size

Before installation, the company installing your system typically performs a site assessment to create a custom system. This helps determine the optimal solar system size for your energy needs.

Average peak sun hours in Arizona: 7-8

The number of solar panels you need depends on how much electricity your household uses. In Arizona, the average monthly energy consumption is 1,048 kWh, according to the Energy Information Administration.

No system is 100% efficient, so you must account for losses caused by shading, wiring and inverter efficiency.

Condition of your roof

Your roof needs to be in good enough condition to support solar panels as long as they last, which is usually around 25 years. If you have an older home, the roof might not be up to standards.

Solar panels typically last 25 years

A solar customer in Phoenix was understandably frustrated about having to replace their roof less than five years after installing panels. The process is expensive and time-consuming.

“It took them more than six weeks to get a crew out to uninstall the panels and another three-plus weeks of constantly calling to schedule the reinstall after the roof was replaced,” they said. “Not to mention that the removal and reinstall is costing me nearly $10,000 to get completed.”

The extra cost to do this can be frustrating. Another customer in Florence said, “To replace the roof, the panels have to come off and must go back on for a cost of $3,900 in addition to the cost of the roof.”

Local permitting

Local permitting fees can range from $150 to $600 in most places in Arizona. The permitting process will be different depending on where you live in Arizona. For instance, you can submit your permit online in Maricopa County and through an app in Oro Valley, but you have to deliver it to City Hall in El Mirage.

» GUIDE: Solar panel installation guide

How you pay

You can pay the full price upfront, but many people in Arizona finance solar panels. A solar loan works like any other type of loan — there’s an application and approval process, and you pay it back over time (with interest). If you finance, you need to consider the interest as part of your overall cost.

For example, a solar customer in Prescott Valley told us they are saving $40 on their electricity bill, but considering their loan payment is about $120, their total monthly payments went up by about $80. Solar loan terms typically last between eight and 20 years and come with interest rates as low as 1% to 2%.

Solar incentives, tax credits and rebates in Arizona

The federal solar investment tax credit (ITC) is the biggest factor in reducing the cost of going solar in Arizona. If you install a residential solar panel system by the end of 2032, you can deduct 30% of the system's total cost — including equipment, labor and permits — from your federal taxes. The credit drops to 26% in 2033 and 22% in 2034.

Average ITC value in Arizona is $4,392

Arizonans can take advantage of several other incentives, including a state tax credit and a property tax exemption for solar installations.

» MORE: Arizona solar incentives

Compare solar installation companies in Arizona

There are more than 350 solar companies in Arizona, including manufacturers, installers and developers, according to the Solar Energy Industries Association. Read our guide to finding the best solar companies to learn more.

Bottom line

As of 2023, the average cost of a complete solar panel system in Arizona is $21,011 after the federal solar investment tax credit (ITC). Arizona's average household energy needs are relatively high, impacting the out-of-pocket expenses for solar installation. However, the system typically pays for itself within 15 years.

» STILL NOT SURE? Solar energy pros and cons