2024 Solar Incentives Guide for Tucson, AZ - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Tucson.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Tucson?
Solar and Wind Equipment Sales Tax Exemption
Residential Solar and Wind Energy Systems Tax Credit
Qualifying Wood Stove Deduction
Energy Equipment Property Tax Exemption
Trico Electric Cooperative - SunWatts Incentive Program
Sulphur Springs Valley EC - SunWatts Rebate Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are intended to encourage homeowners to switch their home over to renewable energy by offering financial incentives meant to lower the burden of solar panel installation and use. You may be eligible for different kinds of incentives, including discounts, cash back or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Arizona and others from the federal government. Types of solar incentives might include:
- Tax Credits: Tax credits lower, dollar-for-dollar, the amount of income tax you owe the government. Tax credits differ from tax deductions.
- Net Metering: Net metering factors in once your solar system is up and running. If you have in place a net metering agreement with your Tucson utility company, it will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in other places you may make back a percentage of the value.
- Rebates: A rebate is a partial refund credited to your account after you've paid for your solar system. Rebates might be offered by your local utility company, your county or your state. The cash back that you get from the rebates is normally applied before calculating tax credits.
- Tax Exemptions: Your solar panel system may qualify for exemptions on both sales and property tax. Sales tax exemptions are applied at the time of purchase. Property tax exemptions let you exclude the value added by your solar panels when calculating property taxes on your house.
Best for Leasing
Sunrun
- Expansive service area
- Many financing options
- Some reported issues with customer service
- Some reported issues with door-to-door sales
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Federal Solar Incentives
Federal solar incentives are likely the first thing that you think of when thinking about solar incentives. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a percentage of your solar system's cost.
The ITC applies to the total cost of installing a solar system, including the panels themselves as well as accessories, labor and equipment. You can claim this credit for panels installed after January 1, 2006, on a primary or secondary residence that you own and that is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum amount you can claim.
Wondering how the ITC applies to your specific situation? Get in touch with your local Tucson solar panel installation expert to get more information.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as renaming it to the Clean Energy Credit). Under the new program, solar installation projects that are completed between 2022 and 2032, might qualify for a 30% tax credit. This percentage will then see a slight annual decrease until the current Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. The best way to fully understand how the new Clean Energy Credit applies to you is to get in touch with your local Tucson solar panel installation expert.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. Like with federal incentives, these may include tax credits, rebates and more. The incentives — which may be handled by the state of Arizona, or by your county or municipality — might be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Tucson
You can qualify for solar incentives from the Arizona government and the federal government, as well as from your local utility company. Growing availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. Reaching out to your local Tucson solar panel installer is an excellent first step towards getting all the incentives you qualify for when you switch to solar energy.
EcoWatch's Tucson, AZ Solar Incentives FAQs
How can I find out if I qualify for specific solar incentives?
In most cases, solar incentives apply to:
- a new solar panel system
- installed on property that you own
- within the U.S.
- between the dates specified by a particular incentive.
Specific incentives, including those given out by the Arizona government or by your county/municipality, could have additional qualifications. Get in touch with your local Tucson solar installer to learn more about what incentives your project may qualify for.
I already have solar panels. Are there any incentives that I qualify for?
Your best bet is to talk to a representative from the company that installed your system – or reach out to a local Tucson solar installer — to learn about which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
Who installs solar panels near me?
To learn about the top solar panel installation companies near you, read our article on Tucson's top solar panel companies.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly called the ITC and now titled the Clean Energy Credit, is scheduled to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.