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» Learn about Photovoltaics » Incentives & Costs
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Incentives & Costs
Prices have never been better for solar-electric! The state of Arizona and Arizona utilities offer some of the best financial incentives in the
country for solar-electric systems. These rebates and tax credits can typically cover over 50%
of the system cost. If you are not in Arizona, details on all renewable energy incentives
available in your state can be found at www.dsireusa.org.
APS Rebates
Residential Grid-Tie
$3.00 rebate per installed watt. Therefore, if you install a 3,000 watt system, APS will send you a check for $9,000.00.
Residential Stand-Alone
$2.00 rebate per installed watt. If you're within an APS service area and install an off-grid solar-electric system, you qualify for this rebate.
Commercial Grid-Tie
$2.50 rebate per installed watt or a Performance Based Incentive(PBI) at 25¢/kWh for 10 years or 18¢/kWh for 20 years. The PBI pays quarterly based on the number of kilowatt-hours your system produces during that period.
Learn more at APS Incentives for Solar Energy
Federal Incentives
Personal Tax Credit
30% of the total system cost minus the rebate. The $2,000 cap that was in place has been removed! The credit should
be claimed in the year that the system is placed into service, and if the amount of the credit exceeds a taxpayer's liability
in a certain year, the unused portion of the credit may be carried to the following tax year.
Business Energy Tax Credit
30% of the system cost for equipment placed in service up to December 31, 2008.
Corporate Modified Accelerated Cost-Recovery System (MACRS) + Bonus Depreciation
Solar installations qualify for a five year accelerated depreciation.
State Tax Credits
Personal Tax Credit
25% of the system cost up to $1,000.00. The credit should be claimed in the year of
installation and if the amount of the credit exceeds a taxpayer’s liability in a
certain year, the unused portion of the credit may be carried forward for up to
five years.
Corporate Tax Credit
10% of the system cost up to $25,000 for any one building in the same year and
$50,000 in total credits in any year.
System Cost
For full-service installations you can generally plan on $6.00 - $8.00 per installed
watt before rebates/tax credits depending on the system size and type of installation.
A Do-It-Yourself system will typically lower this cost by 10-20%. For example, a home in
Flagstaff using about 20 kWh per day may require a 4,000 watt PV system to offset 100%
of their electricity usage:
| Full-Service Installation System Cost: |
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$24,000 - $32,000 |
| APS Rebate: |
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($12,000) |
| Federal Tax Credit: |
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($3,600 - $6,000) |
| State Tax Credit: |
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($1,000) |
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Final costs after rebates and credits |
| Full-service Installation System: |
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$7,400 - $13,000 |
| DIY Installation System: |
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$6,000 - $10,500 |
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