Incentives available for commercial solar in 2014 can cover up to 65% of system costs, reducing the payback period to as low as 4 years.
Federal Tax Credit
The federal solar income tax credit is 30% of the total system cost. There is no cap and it can be carried forward if needed. Set to drop to 10% for systems installed after December 31, 2016.
Details found here: DSIRE.org Federal ITC
State Tax Credit
The Arizona state tax credit is 10% of the system cost and is capped at $25,000 per location, $50,000 per business. There is a $1,000,000 pool of funds available first-come-first-serve each year for systems placed in service that year only. Systems installed earlier in the year have a greater chance of being awarded funds. Expires Dec 31, 2018. Note: There is a 1% charge for obtaining the necessary certification letter from the Arizona Commerce Authority for the credit.
Details found here: DSIRE.org AZ ITC
State Property Tax Increase Exemption
Arizona state law dictates that your property taxes will not increase as a result of installing a photovoltaic system.
Details found here: DSIRE.org AZ Property Tax
Solar installations can be depreciated in five years under MACRS rules. The tax basis for depreciation is effectively equal to the total system cost less 50% of state and federal tax credits and is valued at approximately 25% of the system cost.
Details found here: DSIRE.org Depreciation
The USDA’s Rural Energy America Program provides grants and loan guarantees to ‘rural’ small businesses outside of a census metro area (including Green Valley and Sahuarita) and agricultural producers (including plant nurseries) to deploy renewable energy systems and energy efficient measures. The grant is for up to 25% of the total project cost.
To see if your business qualifies as ‘rural’ input your address here: Property Eligibility Search
Details found here. USDA.gov
TEP offers NET metering for solar electric systems. This means that excess kWh production is carried over for use during following months at a retail rate. Once a year, during the October billing cycle, any excess production that has not been used is purchased by TEP at the wholesale cost, generally $0.03 – $0.04/kWh.
For a description of how it works, see: What exactly is Net Metering?