Solar resource
Your solar production in Tucson
6.39 avg peak sun hours/day
Monthly avg solar radiation (kWh/m²/day) — Tucson, AZ. Bars update to show estimated kWh production when you use the calculator above.
Utility rate
Tucson Electric Power (TEP) electricity rate
$0.125/kWh residential
- Utility
- Tucson Electric Power (TEP)
- Residential rate
- $0.125/kWh (blended)
Tucson Electric Power (TEP) is the primary electric utility serving metropolitan Tucson and most of Pima County. TEP is distinct from APS (Arizona Public Service), which serves Phoenix and Maricopa County. TEP's export rate for solar customers under its net metering tariff is the Arizona Corporation Commission-approved Avoided Cost rate, approximately $0.076–$0.092/kWh in 2024 — similar to APS but set independently through TEP's rate case proceedings. Sonoran Desert UV exposure causes additional panel degradation of approximately 0.4–0.6%/year (vs. the national average of 0.5%), and sustained temperatures above 100°F reduce panel output by approximately 10–15% during peak summer afternoons relative to Standard Test Conditions. Tucson's exceptional June peak irradiance (8.66 kWh/m²/day) partially compensates, and fall/spring shoulder months remain highly productive.
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Incentives
Available solar incentives in Tucson, AZ
Federal + state + utility
| Incentive | Type | Value | Scope |
|---|---|---|---|
| Federal Solar Investment Tax Credit (ITC) | Tax Credit | 30% of system cost | Federal |
| Arizona Residential Solar Energy Tax Credit | Tax Credit | 25% of installation cost, up to $1,000 | State |
| Arizona Solar Equipment Property Tax Exemption | Exemption | 100% of added home value from solar | State |
| TEP Net Metering (Avoided Cost Rate) | Net Metering | ~$0.076–$0.092/kWh for exported solar energy | Utility |
Incentive amounts and eligibility rules change. Verify current terms with your installer and a tax professional before installation.
System cost
Cost breakdown (6 kW default)
- Gross system cost
- $17400
- Federal ITC (30%)
- −$6220
- Net system cost
- $11,180
- Installed cost per watt
- $2.9/W
Lawrence Berkeley National Laboratory Tracking the Sun 2024 — Southwest/Arizona median installed cost for systems 3–10 kW. Tucson's installer market is competitive; $2.90/W is a reasonable installed cost estimate for a standard 6 kW system.
Payback & long-term value
25-year outlook
- Annual savings (yr 1)
- $1,246
- Simple payback period
- 9.0 years
- 25-year net savings
- $19970
- Assumed annual rate increase
- 2.5%/year
25-year estimate uses flat electricity rate for conservative baseline. Accounting for 2.5% annual rate increases, lifetime savings increase substantially.
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How it works
How solar savings work in Tucson
- Your panels capture Tucson's exceptional Sonoran Desert sunlight Tucson averages 6.39 peak sun hours per day — among the highest of any major U.S. city and comparable to Phoenix. The Sonoran Desert climate delivers intense year-round irradiance, with June peaking at 8.66 kWh/m²/day. Even winter months (January: 4.20) far exceed what northern cities receive in summer. A 6 kW system in Tucson produces roughly 9,966 kWh per year.
- High-temperature derating reduces peak output but doesn't eliminate value Solar panels are rated at 25°C (77°F), but Tucson summer afternoons regularly reach 100–115°F. High-quality monocrystalline panels derate approximately 0.35–0.45% per degree Celsius above STC. At 45°C ambient (113°F) plus panel heat, effective output may be 10–15% below the nameplate rating during peak summer afternoons. The strong spring and fall shoulder seasons and intense June irradiance more than compensate over the annual average.
- You use solar power instead of buying from TEP Every kWh your system produces during daylight reduces what you buy from Tucson Electric Power at ~$0.125/kWh. A 6 kW system produces approximately 9,966 kWh/year, saving about $1,246 annually at current TEP rates.
- Excess power flows to TEP at the Avoided Cost rate When your panels produce more than your home uses, excess electricity flows to TEP's grid. TEP credits this exported energy at the Arizona Corporation Commission's Avoided Cost rate — approximately $0.076–$0.092/kWh in 2024, not the full retail rate. Sizing your system for high self-consumption maximizes savings.
- You claim the federal and Arizona state tax credits In the tax year your system is installed, claim the 30% federal Investment Tax Credit ($5,220 on a $17,400 system) plus Arizona's 25% residential solar tax credit (capped at $1,000) — a combined incentive of $6,220 that reduces your net system cost to $11,180.
- Your savings grow as TEP rates rise As TEP rates increase over time (historically ~2.5%/year), your solar savings compound. Over 25 years, a 6 kW system in Tucson nets approximately $19,970 after recovering the installation cost — solid economics bolstered by Tucson's outstanding solar resource and Arizona's state tax credit.
FAQ
Common solar savings questions for Tucson, AZ
How much can I save with solar in Tucson?
A 6 kW system in Tucson produces roughly 9,966 kWh/year and saves approximately $1,246/year at TEP's current blended rate of ~$0.125/kWh. After the 30% federal tax credit ($5,220) and Arizona's $1,000 state tax credit, the net system cost is about $11,180, with a payback period of approximately 9 years and estimated 25-year net savings of $19,970.
How does TEP differ from APS for solar customers?
Tucson Electric Power (TEP) and Arizona Public Service (APS) are separate investor-owned utilities serving different parts of Arizona — TEP serves Tucson and Pima County; APS serves Phoenix and Maricopa County. Both utilities export excess solar at an Avoided Cost rate set by the Arizona Corporation Commission, and both use a similar net billing structure for new solar customers. TEP's rates are generally slightly higher than APS per kWh, giving Tucson solar a slightly better payback than Phoenix despite similar sun hours. Both utilities are subject to the same ARS §42-11054 property tax exemption and §43-1090.02 state solar tax credit.
Does Tucson's extreme heat reduce solar panel output?
Yes — high temperatures reduce panel efficiency. Most panels derate at approximately 0.35–0.45% per °C above their rated temperature (25°C/77°F). On a 113°F (45°C) summer afternoon with panels at 65°C+, output may be 15–18% below nameplate capacity. However, this effect is most pronounced in the early afternoon of the hottest days, while morning production remains near-optimal. Tucson's intense summer irradiance (especially in May–June before monsoon season) and long shoulder seasons ensure a high annual production total. Choosing panels with a low temperature coefficient mitigates the high-heat derating.
What solar incentives are available in Tucson?
Tucson homeowners benefit from: (1) the 30% federal Investment Tax Credit (ITC) through 2032; (2) Arizona's 25% residential solar tax credit capped at $1,000 (ARS §43-1090.02); and (3) a full property tax exemption on the value added to your home by solar (ARS §42-11054). Combined, these incentives provide $6,220+ in savings on a typical 6 kW installation.
How does Tucson's solar resource compare to Phoenix?
Tucson and Phoenix have nearly identical annual solar resources — Tucson averages 6.39 peak sun hours/day vs. Phoenix at 6.54. Tucson's higher elevation (roughly 2,400 feet vs. 1,100 feet for Phoenix) and slightly lower summer temperatures on average (though both are extreme) mean Tucson panels may see marginally less heat derating than Phoenix panels on the hottest days. Both cities are among the top solar markets in the country by solar resource alone.
What UV and material considerations apply to solar in Tucson?
Tucson's Sonoran Desert UV index is among the highest in the continental U.S. Premium solar panels use UV-resistant glass and encapsulants rated for desert environments. Tucson's long dry season minimizes soiling from rain-driven dust and instead concentrates dust from wind events — periodic cleaning improves production. Racking hardware should be stainless or marine-grade galvanized to resist UV-accelerated corrosion. Panel degradation in Tucson averages 0.4–0.6%/year over 25 years, within normal industry ranges for quality panels.
Sources
Data sources and freshness
- https://pvwatts.nrel.gov/
- https://www.tep.com/rates/
- https://www.tep.com/solar/
- https://openei.org/apps/USURDB/
- https://azleg.gov/ars/43/01090-02.htm
- https://azleg.gov/ars/42/11054.htm
- https://emp.lbl.gov/tracking-the-sun
- https://www.energy.gov/eere/solar/homeowners-guide-federal-tax-credit-solar-photovoltaics
- https://dsireusa.org/
- https://www.azcc.gov/utilities/electric
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Disclaimer: This calculator provides estimates for informational purposes only — not financial or investment advice. Solar savings depend on actual shading, roof orientation, energy usage patterns, rate changes, and equipment performance. Consult a licensed installer and a tax professional before making purchasing decisions. Verify incentive eligibility with official sources. Data last verified 2026-04-19.