Is Solar Worth It in Arizona? A 2025 Homeowner's Guide

Arizona homeowners are uniquely positioned to take full advantage of solar energy. But if you're considering an investment in solar, it's natural to ask: "Is solar really worth it in Arizona?"

The short answer? Yes — and probably more than you realize.

Here’s a full breakdown of why going solar in Arizona continues to offer one of the best returns on investment for homeowners anywhere in the country.

1. Arizona Has Ideal Solar Conditions

Arizona’s climate is perfectly suited for solar energy. With over 300 sunny days a year, homes in Phoenix, Tucson, and across the state receive more sunlight than almost anywhere else in the U.S.

This high solar exposure means:

• Your panels produce more electricity

• Your energy savings add up faster

• Your solar panel ROI in Arizona is among the best in the nation

Simply put: solar panels work harder in Arizona than in most other states, making them a smart financial and environmental investment.

2. Solar Costs Are Lower Than Ever

If you’re wondering about the cost of solar panels in Phoenix, you’ll be happy to know prices have fallen by more than 50% over the past decade.

Today, most Arizona homeowners pay between $15,000 and $25,000 for a full residential solar system before incentives.

After factoring in available programs (which we'll explain next), the net cost is even more affordable — often dropping by 30%–40% or more.

When comparing options, always consider how much solar panels cost in Arizona after incentives, not just the sticker price.

3. Strong Solar Incentives Are Still Available

Arizona continues to offer some of the best solar incentives in the country, helping homeowners lower their costs significantly.

Here’s what’s available:

• 30% Federal Solar Investment Tax Credit (ITC): Reduces your total system cost by 30% through a federal tax credit.

• $1,000 Arizona Solar Tax Credit: A flat $1,000 credit against your Arizona state income taxes.

• Sales Tax Exemption: Solar equipment purchases are exempt from state sales tax.

• Property Tax Exemption: The value added to your home by solar panels is not taxed.

These Arizona solar incentives can save you thousands upfront, while boosting your long-term energy savings even more.

4. Arizona Net Metering Policy: How You Save More

Under Arizona’s net metering (technically now net billing) policy, you can earn credits from your utility company for any excess solar energy you send back to the grid.

While the credits are slightly lower than full retail electricity rates, they still provide valuable savings by reducing your overall bill.

Pairing solar panels with battery storage allows homeowners to maximize their own energy use before exporting it, making solar even more valuable under Arizona’s current net billing rules.

5. Solar Panel ROI in Arizona: What to Expect

Thanks to the combination of high sunlight, strong incentives, and rising utility rates, most homeowners in Phoenix see an impressive solar panel ROI.

Typical figures include:

• Payback period: 6 to 8 years

• Savings over 25 years: $25,000 to $40,000 or more

After your system pays for itself, every year of free solar electricity is pure profit.

Few home improvements offer returns this strong — and with electricity prices continuing to rise, the benefits of solar only increase over time.

Final Verdict: Is Solar Worth It in Arizona?

Absolutely. Arizona remains one of the best states in the country to invest in solar energy.

If you install a high-quality system, maximize incentives, and work with a reputable local installer, you can:

• Cut or eliminate your electricity bill

• Increase your home’s value

• Protect yourself from utility rate hikes

• Achieve excellent long-term financial returns

In 2025 and beyond, solar continues to be one of the smartest financial and environmental decisions Arizona homeowners can make.

Ready to Explore Solar for Your Home?

If you're ready to take control of your energy costs and maximize your savings, now is the time to act. Contact Phoenix Valley Solar today for a free.