Arizona to reduce incentives for solar panels installed in residences and businesses

Arizona to reduce incentives for solar panels installed in residences and businesses

January 1, 2012 0 By Jake Banks

The Arizona Corporation Commission (ACC), a state-run organization responsible for finalizing utility rate adjustments, expects to reduce the incentives granted to companies looking to adopt solar energy.

The move comes as utility rates for homes and businesses with solar panels installed reach their estimated target. Arizona law provides incentives to those installing their own solar panels in an attempt to have solar energy account for 15% of the state’s energy by 2025. The ACC claims that because the target is being met, the incentives offered by the state should be reduced.

The ACC is looking to set residential solar incentives at $0.85 per watt of electricity generated by solar panels. If the residential sector continues to meet its goals in terms of alternative energy by June of 2012, the incentive will be automatically reduced to $0.70 per watt. Overall, homeowners will lose out on total savings of $850, which would have offset the cost of installing solar panels. Businesses will be affected by the new rules as well.

The ACC has recommended cutting incentives for businesses from their current $1.75 per watt to $0.85 per watt.

The ACC reasons that the state should not continue providing incentives if individuals and businesses can install solar panels without the need of financial aid, a notion that is shared by Governor Janice Brewer. Advocates of the incentives argue that solar energy would not have become as popular as it is in the state without the incentives.

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