How Solar Financing Works in Arizona: Cash, Loans, and Lease Options Explained

Are you considering solar energy for your home in Phoenix? Now is the perfect time to harness the power of the sun and take advantage of significant savings through federal and state tax credits. Our team at Phoenix Valley Solar can help you navigate these incentives and maximize your savings. You can also use our Arizona Solar Calculator to get an estimate of your potential benefits.

Overview: Paying for your solar system in cash means you own it outright from day one. There are no monthly payments — and you’ll start saving immediately.

Pros:

• Best long-term savings and highest solar panel ROI in Arizona

• No interest payments or lender fees

• You qualify for the full Arizona solar tax credit and 30% federal tax credit

• Increases your home value with no strings attached

Cons:

• Requires upfront capital (typically $15,000 to $25,000 before incentives)

Best for: Homeowners with available savings who want the maximum return over the system’s 25+ year lifespan.

2. Solar Loans: Own Your System with Low Upfront Cost

Overview: Solar loans allow you to spread the cost of your system over time — usually 5 to 20 years — while still owning the system and claiming all available incentives.

Pros:

• Little to no money down

• Fixed monthly payments, often lower than your current electric bill

• Full access to the Arizona solar tax credit and federal ITC

• Adds value to your home

Cons:

• Interest charges reduce long-term savings slightly

• Monthly payments for the loan period

Best for: Homeowners who want to own their system but prefer manageable monthly payments instead of upfront cost.

3. Solar Leases and Power Purchase Agreements (PPAs): No Ownership, Limited Incentives

Overview: With a lease or PPA, a solar provider installs panels on your home at no upfront cost. You then pay a monthly fee — either a fixed lease payment or a rate per kilowatt-hour — to use the energy produced.

Pros:

• No upfront costs

• Guaranteed system performance

• Predictable monthly energy expenses

Cons:

• You do not own the system

• You cannot claim the Arizona solar tax credit or federal incentives — the leasing company does

• May complicate resale if buyer is unwilling to assume the lease

• Lower overall financial benefit

Best for: Homeowners who cannot qualify for a loan or who want solar with no investment — but are okay with reduced ROI.

4. How Financing Affects Your Solar Savings

Here’s how each option typically impacts savings over 25 years in Arizona:

Financing Option	Ownership	Eligible for Tax Credits?	Estimated Savings (25 Years)
Cash Purchase	Yes	Yes	$30,000 – $40,000+
Solar Loan	Yes	Yes	$25,000 – $35,000
Lease / PPA	No	No	$5,000 – $15,000

Note: These are general estimates. Actual results depend on system size, utility rates, and home energy use.

5. Is Solar Worth It in Arizona, No Matter How You Pay?

Yes — even with different financing structures, solar remains worth it in Arizona due to:

• High electricity rates

• Strong Arizona solar incentives

• The state's abundant sunlight

• Long-term savings and home value increases

That said, your solar panel ROI in Arizona will vary based on how you finance the system. Ownership = higher returns.

Final Thoughts: Choose the Financing Option That Fits Your Goals

There’s no one-size-fits-all answer. Whether you’re focused on upfront savings, long-term ROI, or making your home more energy independent, there’s a solar financing solution that works for you.

Just make sure you understand:

• Who owns the system

• Who claims the tax credits

• What your payments look like over time

• How financing impacts your net savings

Work with Arizona’s Trusted Solar Partner

At Phoenix Valley Solar, we help homeowners:

• Compare all solar financing options

• Maximize savings with state and federal tax incentives

• Understand their break-even timelines and long-term ROI

Contact us today for a free consultation — and find the solar financing path that works best for your home, your budget, and your goals.

Are you considering solar energy for your home in Phoenix? Now is the perfect time to harness the power of the sun and take advantage of significant savings through federal and state tax credits. Our team at Phoenix Valley Solar can help you navigate these incentives and maximize your savings. You can also use our Arizona Solar Calculator to get an estimate of your potential benefits.