Commercial Solar Incentives in Arizona

This material has been prepared for informational purposes only. Greentech Renewables does not provide tax, legal, or accounting advice. Information displayed is not project-specific and will require an official written proposal by a certified installer. 

Arizona State Solar Tax Credit

Arizona businesses are eligible for a state solar tax credit that accounts for 10% of installed costs, up to $25,000 per building. 

Sales and Property Tax Exemption

The purchase of solar equipment in Arizona is exempt from sales and property taxes, leading to more upfront savings.

Bonus Depreciation 

In Arizona, bonus depreciation is still available at 40% in 2025, but will step down by 20% each year.

Arizona Net Billing Program

Arizona's utility companies no longer has a net metering program, but has transitioned to a net billing program. Through this program, commercial customers with new solar systems will be credited at an avoided cost rate for any excess energy their solar system exports to the grid. 

Business owners in Arizona may also take advantage of the federal solar incentives available. When applied in combination with the state's incentives, these solar incentives have the potential to significantly reduce the cost of installing a solar system in Arizona

Business Energy Investment Tax Credit (ITC)

The Business Energy Investment Tax Credit program allows businesses to claim 30% of their solar system costs as a federal tax credit. Additional tax credits are available depending on the district. 

Connect with a local installer to find out if you qualify for additional tax credits. 

Renewable Electricity Production Tax Credit (PTC)

Business owners in Arizona may take advantage of the federal renewable electricity production tax credit (PTC). This provides an inflation-adjusted per-kilowatt-hour (kWh) tax credit for electricity generated by qualifying energy sources. Projects under 1 megawatt (MW) can receive 1.5 to 2.75 cents/kWh depending on the type of facility. Projects over 1 MW will receive a base tax credit of 0.5 cents/kWh.

Keep in mind that solar project owners cannot claim both the ITC and PTC for the same property. Discuss with a solar installer to understand which tax credit incentive you should claim for your solar system.

Modified Accelerated Cost-Recovery System (MACRS)

Arizona business owners can take advantage of the Modified Accelerated Cost Recovery System (MACRS). This program allows business owners to recover some of the costs of solar panel installation through a five-year MACRS schedule.

Arizona Commercial Property-Assessed Clean Energy (C-PACE)

C-PACE is a financing program that allows approved commercial property owners to borrow money to pay for energy improvements without a large upfront cost coming out of the business' pocket.

Rural Energy for America Program (REAP Grant) 

The USDA's "Rural Energy for America Program," or “REAP,” offers a grant to cover 50% of commercial solar system costs to encourage agricultural and rural businesses to maximize their energy efficiency with solar.

This grant is only available if you own a small business in an area with less than 50,000 in total population. 

FIND OUT IF YOU QUALIFY!

Connect with a local Arizona installer to see which federal incentives can contribute to your solar system. 

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