The U.S. has witnessed remarkable solar growth over the past decade, and Arizona ranks in the top 10 for installed solar capacity. As one of the sunniest states in the nation, Arizona has huge potential for its solar markets and historically has seen tremendous growth. While that growth has slowed in recent years, Phoenix homeowners can still see major benefits benefit from all the sunshine the state has to offer. In this article we’ll explain why Phoenix can be a top spot for solar power and what Phoenix homeowners can do to maximize their solar savings.
How much do solar panels cost in Phoenix?
As of mid-2017, the average price for solar panels in Phoenix was $3.01 per watt. Thus, since the typical system size in the U.S. is 5 kilowatts (5,000 watts), the average cost of a solar panel system in Phoenix is $15,050 before any rebates or incentives.
While this price is low for the overall state of Arizona, it is also very competitive in terms of the national average. Prices for solar panel systems have dropped by over 64% in Arizona over the past 5 years and homeowners are taking notice. Check out this comparison table of Phoenix, the state, and U.S. average pricing for various system sizes:
Solar pricing table: Phoenix compared to state and U.S. average costs
|System size||National average cost
|Arizona average cost
| Phoenix average cost
The above table, which uses pricing data from solar quotes received by homeowners on the EnergySage Solar Marketplace over the last 12 months, offers a comparison of prices nationwide, statewide, and in Phoenix for solar energy systems. As the data illustrates, typical solar prices in Phoenix, Arizona are significantly lower than the rest of the country.
When looking at the solar industry as a whole, it’s well known that Arizona is one of the most affordable and pragmatic places to install solar. But when you zero in on Phoenix’s market and compare it to the rest of the country, the advantage for homeowners is even clearer. The good news for most Arizona homeowners is that these low costs do not even incorporate the added benefit of net metering, offered throughout the state.
Arizona’s net metering and other incentives
Like most states, Arizona has a net metering program which allows homeowners to sell their extra solar energy back to the grid. When your solar panel system produces more than you need, the excess is sent back to the grid in exchange for bill credits. When your system isn’t producing enough electricity, you can draw it from your utility just as you did before you went solar. As a result, the excess electricity your home produces covers the times when you don’t produce enough.
Other incentives in Arizona include the Residential Arizona Solar Tax Credit, which reimburses homeowners 25 percent of the cost of solar panels, up to $1,000, right off of their personal income tax in the year the system is installed.
Arizona also offers the Solar Equipment Sales Tax Exemption which frees homeowners from the burden of any Arizona solar tax. Homeowners are not required to pay any sales tax on the purchase of a solar system. Similarly, the Energy Equipment Property Tax Exemption means homeowners won’t have to pay any additional property taxes on the value added to their home by investing in solar panels.
How Phoenix homeowners can save big with solar
Though Phoenix residents will see some of the cheapest solar prices in the country with continued cost declines expected over the next five years, low prices aren’t necessarily the biggest selling point. When it comes to going solar, the long term ROI and savings from avoided bill payments is often the biggest deciding factor – and the figures can be staggering even in states where utility rates are reasonable.
In 2017, solar quotes received by Phoenix homeowners yielded 20-year savings estimates of over $81,083 on average. Checkout the breakdown of average net savings by solar system size:
Phoenix net 20-year savings from solar
|System size||Average solar savings over 20 years|
Three tips for solar shoppers in Phoenix, AZ
Homeowners who get multiple quotes save 10% or more
As with any big ticket purchase, shopping for a solar panel installation takes a lot of research and consideration, including a thorough review of the companies in your area. A recent report by the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL) recommended that consumers compare as many solar options as possible to avoid paying inflated prices offered by the large installers in the solar industry.
To find the smaller contractors that typically offer lower prices, you’ll need to use an installer network like EnergySage. You can receive free quotes from vetted installers local to you when you register your property on our Solar Marketplace – homeowners who get 3 or more quotes can save thousands on their solar panel installation.
The biggest installers typically don’t offer the best price
The bigger isn’t always better mantra is one of the main reasons we strongly encourage homeowners to consider all of their solar options, not just the brands large enough to pay for the most advertising. A recent report by the U.S. government found that large installers are $2,000 to $5,000 more expensive than small solar companies. If you have offers from some of the big installers in solar, make sure you compare those bids with quotes from local installers to ensure you don’t overpay for solar.
Comparing all your equipment options is just as important
National-scale installers don’t just offer higher prices – they also tend to have fewer solar equipment options, which can have a significant impact on your system’s electricity production. By collecting a diverse array of solar bids, you can compare costs and savings based on the different equipment packages available to you.
There are multiple variables to consider when seeking out the best solar panels on the market. While certain panels will have higher efficiency ratings than others, investing in top-of-the-line solar equipment doesn’t always result in higher savings. The only way to find the “sweet spot” for your property is to evaluate quotes with varying equipment and financing offers.
For any Phoenix homeowner in the early stage of shopping for solar that would just like a ballpark estimate for an installation, try our Solar Calculator that offers up front cost and long term savings estimates based on your location and roof type. For those looking to get quotes from local contractors today, check out our quote comparison platform.