How Do Solar Utility Rebates Work?

In 2006 the Arizona Corporation Commission (ACC) passed a requirement for utility companies in Arizona to obtain a significant portion of their electricity from renewable resources. Part of this requirement is that a certain percent of the renewable energy be obtained from residential installations, meaning that the utility companies were responsible to provide incentives for residential customers to install renewable energy systems. The most popular of these systems is photovoltaic solar electricity systems, which is what we at Royal Solar of Arizona install.

In order to meet the ACC requirements, many utility companies in Arizona offer cash rebates to their customers who install solar electricity systems. In return, the customer must sign over the “green credits” for the solar electricity produced by the system. How do you calculate the utility rebates?

There are many types of solar rebates available, but the most common is the up front incentive. Each utility company has their own rebate rate that they pay. This rebate amount is multiplied by the wattage of the system in order to determine the total utility rebate that a project is eligible for. Typically this rebate is signed over to the solar contractor (Royal Solar of Arizona) to reduce the out of pocket cost necessary to install a solar (PV) electric system.

A great place to research utility rebates in Arizona: