What’s the Cost of Solar Panels in Arizona in 2021?

Cost of Solar Panels in Arizona

Arizona’s endless sunshine has made solar systems an enticing proposal for property owners. Already, tens of thousands of homeowners have installed solar panels to generate electricity from them. Besides, the new financing option and falling cost of solar panels in Arizona continue to draw consumers’ interest.

The cost of solar panels in Arizona

As of February 2021, the average cost of solar paneling was $2.67/watt, making a 6000 watt (six kW) solar panel system $11,837 after claiming the current federal solar tax credit of 26 percent. This is lower than the average cost of the solar system for homes across the country, which currently $2.95/watt.

Note that the cost for solar panels varies depending on many factors (discussed in the last part of this article).

Cost of solar panel installation in Arizona

The size of a solar system also plays a key role in the total cost of solar paneling installation. Large solar installations often have a low cost per watt because you can purchase the panels at ‘bulk price.’ But these larger solar power systems will have a higher total cost because they consist of many individual panels.

Solar system sizeAverage cost per wattAverage system cost after tax credit
4 kW$2.93$8,664
5 kW$2.80$10,364
6 kW$2.67$11,837
7 kW$2.64$13,670
8 kW$2.68$15,866
9 kW$2.59$17,216
10 kW$2.56$18,929

These estimated costs of solar panel installation are likely to vary from one city to another or county to another. So, request a quote from your preferred solar panel company to know the exact cost of solar panel installation in Arizona.

How to calculate the cost of a solar system for a home in AZ?

The solar panel installation cost for a home varies depending on the property’s electricity bill and location. So, the cost of solar panels should be tailored to a specific home. Check platforms with a calculator to determine the total cost of solar panels in Arizona or request a quote here.

Factors that impact the cost of solar panels in AZ

Cost of Solar Panels in Arizona

The cost of solar panels for residential properties includes more than the solar system components and installation costs. Other costs include inspection expenses, permitting costs, and the installer’s profit margins. Here is an illustration to help you understand various costs that constitute the overall cost of solar panels in Arizona, plus installation expenses. (Note that these may not be the exact costs of our services. So, request a quote to know the cost of solar panel acquisition and installation.)


These components or services are the main cause of fluctuations in solar panel cost and installation expenses. Other factors that impact the cost of solar panels in Arizona include;

Your property’s electricity needs

Properties that use a lot of electricity need a powerful solar power system to cover their electricity needs. While solar panels get more affordable on a per-watt basis, the total cost of a residential solar system increases as the number of solar panels increase. On the flip side, generating enough solar power will save your household on energy-related bills. This will cover the

Solar paneling type

The cost of solar panels also varies depending on the specific type of panels you intend to buy. The two main types of solar panels for residential installations include polycrystalline and monocrystalline. Monocrystalline panels are more expensive but efficient, while polycrystalline solar panels are associated with lower efficiency ratings and low cost. The specific inverter you purchase may also impact the total cost of the solar power system.

The overall quality of solar panel installation

You have probably seen some solar panel installation quotes that appear too good to be true. In case you get quoted for a very cheap price, there is a good chance the solar panel installer is using low-quality equipment. So, the cheapest solar installation company isn’t always the best choice. Remember, you need a reliable installer because you will be using your solar system for 25 years or more.

Local, state, and federal solar incentives

The total cost of acquiring and installing the entire solar power system can also be impacted by the available federal tax credits and other incentive programs. Across the United States, homeowners can apply for the available federal solar tax credits, commonly known as the ITC.

These incentives make the process of installing a solar power system more cost-effective by offering the property owners with tax credits equal to 26 percent of the total cost of the installed solar system. Additionally, local solar rebates and tax incentives can save you thousands of dollars on a solar system installation, particularly if you also qualify for a federal solar tax credit. It justifies the cost of solar panels in Arizona.

How do solar tax credits offset the cost of solar panels for homes in AZ?

The cost of installing solar panels in AZ is supported by a federal solar tax credit. The total amount of this credit is 26 percent of the total value of the solar power system. You can claim this amount on your tax in the year after solar system installation.

Most people mistakenly refer to a federal tax credit as Arizona solar credit. Note that AZ itself offers a solar tax credit. The total amount of the state tax credit is approximately $1,000 and applies to the total cost of your solar power system.

How do solar panel costs compare to APS electricity rates (per kWh)?

The estimated cost of energy from solar panels installed on a residential property in Arizona over two and half decades is 4.5 cents/kWh. On the other hand, the average cost of utility electricity over two and half decades (if you don’t install solar) is approximately 22.4 cents/kWh. It is beyond doubt that solar power is the most affordable way to power a residential property in AZ over the long-term. It will cover the cost of solar panels in Arizona.

Think beyond the solar panel costs

The main difference between purchasing solar panels and other purchases is that a well-installed solar system can last 25 years to 30 years. This is a long time, and you will require regular customer service during that period. As much as the cost of solar panels in Arizona is an essential factor to consider, you should also think about the reputation of the solar energy company and the quality of their customer service. 


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