Solar in Arizona: is it worth it in 2026?
Arizona is a slow-payback state: solar works, but it takes well over a decade to earn back what you paid. Three things decide that: electricity prices rank 28th of 51, it gets more sun than most states (2nd), and exported power earns much less than the retail rate. Of the 51 states and DC, Arizona has the 34th-fastest payback for a typical home.
The average home here pays about $157 a month for 1,030 kWh. A 6.5 kW system sized for that home would knock about $1,114 off the first year's bills, 59% of the total.
Checked November 12, 2026
What makes solar pay off in Arizona
- Size the system to what you use during the day, not to your whole year: extra power sent to the grid earns about 40% of the retail rate. A battery, or running the dishwasher, laundry and EV charging while the sun is up, raises the value of every panel.
- The price per watt decides it. At 15.3¢ per kWh, the price per watt matters as much as the sun. At $3.34 per watt, the high end of what companies quote, payback for a typical system here stretches to 19 years.
- Lots of sun. Each kW of panels makes about 1,755 kWh a year here, so a smaller system covers more of your bill than in most states.
Payback by system size
An average Arizona home uses about 12,360 kWh a year. Here's how systems sized to cover part or all of that work out, bought with cash at $2.57 per watt:
| Covers | Size | Price | Makes a year | Payback | 25-year savings |
|---|---|---|---|---|---|
| 50% | 3.5 kW | $8,995 | 6,143 kWh | 17 years | $7,565 |
| 78% | 5.5 kW | $14,135 | 9,653 kWh | 16 years | $13,388 |
| 99% | 7 kW | $17,990 | 12,285 kWh | 15 years | $17,755 |
| 128% | 9 kW | $23,130 | 15,795 kWh | 17 years | $18,642 |
The 7 kW system pays back fastest, but the 9 kW system saves the most over 25 years, though only if the extra power is used at home. Assumes exported power earns about 40% of the retail rate, prices rise 2.5% a year and one inverter replacement.
How Arizona credits power you send to the grid
Reduced credit (net billing)
APS pays 6.17 cents per kWh for exported power on applications from September 1, 2025 through August 31, 2026, locked for 10 years; TEP pays 5.1 cents. SRP ended net metering in November 2025.
By utility
- Arizona Public Service (APS): 6.17 cents per kWh for applications from September 1, 2025 through August 31, 2026, locked for 10 years. The rate is reset for new applicants every September 1 and has fallen every year since 2017.
- Tucson Electric Power (TEP): 5.1 cents per kWh for applications from October 1, 2025, locked for 10 years.
- Salt River Project (SRP): 3.45 cents per kWh for exported power on SRP's export price plans (E-13 and E-14); its demand plans (E-15 and E-27) net usage instead but add a demand charge. These plans close in November 2029.
Before you sign in Arizona
Check the license. Look the company up with the Arizona Registrar of Contractors, by its legal name or license number, and ask for the electrician's license number too.
SB 1419 (2026):
- Arizona already requires solar sales disclosures; SB 1419 simplified them, replacing 11 separate savings estimates with a shorter summary.
In every state, the FTC Cooling-Off Rule lets you cancel a contract signed at your home until midnight of the third business day.
How to choose a solar company · Contract checklist · Before you sign
Arizona compared with its neighbors
| State | Electricity | kWh per kW | Typical payback | Exported power |
|---|---|---|---|---|
| Arizona | 15.3¢ | 1,755 | 16 years | Reduced credit (net billing) |
| California | 31.4¢ | 1,677 | 10 years | Reduced credit (net billing) |
| Nevada | 13.3¢ | 1,753 | 14 years | Reduced credit (net billing) |
| Utah | 13.0¢ | 1,484 | 22 years | Reduced credit (net billing) |
| New Mexico | 14.8¢ | 1,779 | 10 years | Monthly netting |
Questions about solar in Arizona
How long does solar take to pay for itself in Arizona?
About 16 years for a typical 6.5 kW system bought with cash at the 2026 median price of $2.57 per watt, with no federal tax credit and one inverter replacement. A bigger or smaller system, a different price, or your own usage will change that; the table above shows other sizes.
Does Arizona have net metering?
Not full net metering. APS pays 6.17 cents per kWh for exported power on applications from September 1, 2025 through August 31, 2026, locked for 10 years; TEP pays 5.1 cents. SRP ended net metering in November 2025.
Is there a solar tax credit in Arizona in 2026?
Not from the federal government for buyers: the 30% homeowner credit ended for systems installed after December 31, 2025. For a typical 6.5 kW system in Arizona, that credit was worth about $5,012 and brought payback down to 10 years, instead of 16 years now. Leasing companies can still claim a business credit, so ask for a lease or PPA price too. Your state energy office lists any state rebates.
Is a solar battery worth it in Arizona?
On bill savings alone, not quite: a 13.5 kWh battery at about $15,650 would move about 3,548 kWh of solar power a year from the grid to your evenings in a typical Arizona home, adding about $4,657 of savings over 15 years. That doesn't cover its price, so the system's payback goes from 16 years to 22 years; the rest is paying for backup during outages. Time-of-use rates, battery rebates and utility payments for sharing your battery can tip it; try your numbers in the payback calculator.
Is plug-in solar legal in Arizona?
There's no plug-in solar law yet in Arizona, so your utility may treat a kit like any rooftop system.
How do I check a solar company's license in Arizona?
Look the company up with the Arizona Registrar of Contractors (roc.az.gov) by its legal name or license number, and ask for the electrician's license too.
More guides: What changed for solar in 2026 · Lease or buy? · Plug-in solar · Is my solar system working?
Sources: U.S. Energy Information Administration (EIA), final 2025 data: Annual State Historical Spreadsheets (Form EIA-861, released October 7, 2026) and Electric Power Annual (October 21, 2026); NREL PVWatts (National Solar Radiation Database), statewide averages; Palmetto: Arizona utility guide; SRP: solar price plans and FAQ; SRP: E-13 price plan, 2025 rate book; Aurora Solar: consumer protection developments; EnergySage: median quoted price, first half of 2026.