There is a 25% tax credit for solar and wind systems installed on residential homes. Those eligible for this credit must meet performance and safety guidelines, and must fulfill warranty requirements. Also, Arizona permits a 100% tax exemption for solar thermal and PV systems. In other words, solar improvements do not increase a homeowner's liability.
Arizona honors many federal incentives for solar system installation, and also sponsors many of its own incentives that dramatically reduce the cost of solar energy system installation. Lawmakers have actively worked to create and pass laws that promote solar energy systems.
Programs sponsored by utility companies also offer rebates for residential and commercial properties having solar systems installed. These typically work on a per watt basis for photovoltaic systems. On the other hand, solar hot water systems receive per kWh payment. These program incentives vary in payment, but averages range between $2-3 for PV systems and $0.50-$0.75 for solar hot water systems.
Arizona Public Service
Through a program called Green Choice, Arizona Public Service is able to provide rebates for the purchases of solar energy equipment. Residential homes can receive rebates specifically based on whether or not the home is located on or off the grid. For example, a solar water heat system installed on a residential property can get up to $0.50 per kWH it is expected to save. There are specific rules for metering, so be sure you are well versed on the documentation, as these regulations are updated yearly.
SRP EarthWise Solar Energy
If a residential or commercial property is located in the SRP territory then that building is eligible for rebates through the SRP EarthWise Solar Energy Program. Ending April 30, 2001 the rebaite for a PV system will be $2.15/watt of power installed (maximum $10,750). Residential solar water heat systems can get up to $0.50 per expected kWh in the first year.
SunsWatts Incentive Program
If located in the Sulphur Springs sector, PV systems can receive rebates of up to $3.00/watt installed (for systems less than $75,000). However, this rebate is not available for systems costing more than $75,000.
Customers in the Tuscon Electric Power service area are offered $2.25.watt of on-grid power and $2.00/watt of off-grid power. Residential solar water heaters receive an up front rebate of $750 as well.
SunShare PV Buydown
Unisource Energy Services located on-grid is also eligible for a $3.00/watt installed rebate ($2.00/watt off-grid). However, rebates must not exceed 60% of the total cost of installation.