Going solar in Arizona has never been more affordable. With powerful incentives, flexible financing options, and some of the nation’s strongest sunlight, homeowners and businesses can dramatically reduce their energy costs. But many people are unsure whether they should lease solar panels, choose LightReach (lease-to-own), or take advantage of the 40%+ solar tax credits and incentives available in 2025.
As one of Arizona’s oldest residential and commercial solar providers, PEP Energy created this guide to help you understand the differences and find the best option for your property.
A solar lease allows you to install a solar energy system on your home or business with little to no upfront cost. Instead of purchasing the system, you simply pay a fixed monthly amount to use the solar energy it produces.
Light Reach is a hybrid option between leasing and purchasing. You pay a fixed amount each month, but the system is designed to become yours at the end of the term. It combines the affordability of leasing with the long-term ownership benefits of buying.
Many customers see messaging about a “40% solar credit.” Here’s how it works:
All eligible homeowners and business owners who purchase their solar system can receive a 30% federal tax credit.
While the main Arizona incentive is the Residential Solar Tax Credit (up to $1,000), businesses may qualify for additional depreciation benefits (MACRS), which can push total savings to 35–40% or more.
You must own the system to claim the tax credits. A lease typically does not allow you to claim tax credits, but Light Reach and purchases do, depending on the agreement structure.
Option | Upfront Cost | Monthly Payment | Ownership | Eligible for Tax Credits | Best For |
Lease | $0–Low | Yes | No | No | Customers wanting no upfront cost |
Light Reach | Low | Yes | Yes (after term) | Sometimes | Customers who want future ownership |
Purchase | Higher | None | Yes | Yes | Max tax credits and long-term ROI |
Solar is especially valuable in Arizona because:
With the right financing structure, families and businesses can cut 20–60% of their energy costs.
PEP Energy is one of the oldest residential and commercial solar providers in Arizona. We offer:
Our experts review your energy usage, tax credit eligibility, and financial goals to recommend the plan that gives you the highest return.
A solar lease gives you solar power for a fixed monthly fee without owning the system. Light Reach is a lease-to-own option, allowing you to make monthly payments and eventually own the system at the end of the term.
No. A traditional lease does not qualify because you do not own the system. You may qualify with Light Reach or a full purchase depending on the agreement.
Arizona homeowners and businesses combine the 30% Federal ITC with state credits and commercial depreciation benefits, which can reduce the total cost by 35–40% or more.
Yes. Leasing is ideal if you want little or no upfront cost, predictable monthly payments, and immediate savings without taking on system ownership or maintenance.
Light Reach is best for customers who want long-term ownership but need lower upfront costs. It provides long-term savings and potential eligibility for incentives depending on structure.
Yes. Purchasing a solar system gives the best long-term ROI because you own the system and can claim all eligible tax credits and incentives.
If you want maximum incentives, buying or Light Reach is your best option. If you want no upfront cost and simple savings, a lease may be ideal. Either way, solar in Arizona delivers long-term value, lower utility bills, and increased energy independence.
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