Arizona homeowners rush to install solar before energy tax credits expire
SUN CITY, AZ (AZFamily) — For years, the federal government has been helping homeowners reduce the cost of solar energy, with the assistance of tax credits that make the systems more affordable.
However, those tax credits are set to expire at the end of the year, prompting a last-minute push to capitalize on the savings.
Chris Hanson just bought a new house in Sun City, and the first thing she did was install solar panels on her roof.
“I didn’t want to do such a big expense when I just moved into the house two months ago because I have so many other expenses,” said Hanson. “But it doesn’t make sense for me to wait either.
The 64-year-old business analyst is one of many Arizona homeowners who are jumping into buying solar before the clean energy tax credits expire at the end of December.
Tyler Carlyle with Bright Home Energy in Phoenix said that President Trump’s budget bill, which Congress passed in July, eliminates several clean energy tax credits.
After Dec. 31, homeowners will no longer be eligible for a 30% federal tax credit on solar.
An energy-efficient home improvement credit of up to $3,200, for items such as insulation, new windows, and heat pumps, is also being eliminated.
“An average system might be around $25,000,” said Carlyle. “You start doing the math, 30% for federal tax credit, $1,000 from state, you’re talking $10,000 in savings by going solar now purchasing the system.”
Greg Field with PGT Home Energy Solutions is convinced the expiring tax credits will have a devastating impact on Arizona’s solar industry.
He said not only will it make clean energy systems less affordable, but it will also lead to higher energy bills and drive dozens of solar businesses out of business.
“Its the first time in 18 years of selling solar we have not had a subsidy the following year,” said Field. “This is unchartered water, but I do expect a lot of companies that aren’t diversified and prepared for this, they will likely go out of business.”
The state of Arizona will continue to offer a $1,000 subsidy for solar installations. In 2026, federal tax credits will go to lenders who offer solar leases to homeowners, according to Carlyle.
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