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Energy Incentive Programs, Arizona

Updated November 2009

Below you will find questions and answers regarding Arizona's utility energy efficiency programs, including options for load management, demand response, and distributed energy resources, and information about state-sponsored energy efficiency programs.

What public-purpose-funded energy efficiency programs are available in my state?

Arizona's restructuring law provides for a systems benefits charge (SBC) to fund energy efficiency programs. The SBC is collected through a non-bypassable surcharge on electricity bills. Some of these funds have been devoted to renewable energy programs, but Arizona utilities budgeted more than $46 million in 2008 to promote energy efficiency in the state (including residential and low-income programs).

What utility energy efficiency programs are available to me?

  • Salt River Project (SRP) offers the PowerWise™ Business Solutions program that provides rebates for lighting, occupancy sensors, HVAC, and motor upgrades as well as custom energy efficiency projects like compressed air systems.

  • Tucson Electric and UniSource Energy Services offer the Business Energy Advisor program, which provides online facility energy audits to small- and medium-sized customers.

  • Arizona Public Service (APS), Tucson Electric, and UniSource offer incentives for both new and retrofit lighting, refrigerators, motors, variable speed drives, and various types of cooling equipment. Customized incentives are also offered for other energy efficiency projects. In addition, the APS Energy Study program provides partial reimbursement for feasibility studies, design, and commissioning (including re- and retro-commissioning). UniSource's Green Energy Conservation Programs for business offer both gas and electric programs.

  • Southwest Gas offers the Combined Heat and Power Program that provides incentives of $400 to $500 per kW for eligible projects that demonstrate a minimum of 60% to 70% efficiency.

  • Southwest Gas also offers commercial customer rebates on new high-efficiency natural gas water heaters, griddles, or steamers for existing facilities. Rebates are available on a first-come, first-served basis through November 30, 2009, or until funds are depleted; whichever comes first.

What load management/demand response options are available to me?

Arizona utilities do not currently offer load management/demand response programs to Federal customers.

What distributed energy resource options are available to me?

The Database of State Incentives for Renewable Energy (DSIRE) provides information on programs that offer incentives for renewable distributed generation. The following programs may be of interest to Federal customers:

  • Tucson Electric and UniSource offer the Green Energy program for customers interested in renewable energy options like geothermal, biomass/bio-fuel, solar, hydropower, and wind.

  • The Salt River Project (SRP) sponsors EarthWise, which offers rebates of $2.25 per watt (DC) for photovoltaic (PV) systems sized up to 20 kW with a maximum payout of $45,000; $2.25 per watt for larger photovoltaic systems (up to $450,000 per system, though larger incentives may be offered on a case-by-case basis), and $0.50 per kWh of metered first-year energy savings for solar water heating systems (maximum $250,000, not to exceed 60% of total project cost). These incentive levels are effective through April 30, 2010. To receive the incentives, customers must agree to let SRP take ownership of the renewable energy credits (RECs) generated from their systems.

  • Arizona Public Service (APS) offers incentives for customers on a first come, first served basis for on-site renewable energy systems installed in the APS service area. Amounts vary based on the type of technology used and the scope of the project. Incentives are offered for solar, wind, geothermal, biogas, biomass, hydropower, and other distributed generation sources.

  • Trico Electric Cooperative's SunWatts Program offers rebates of up to 50% of the total costs for PV and small wind systems of $4 per watt for systems 25 kW or smaller and $3 per watt for systems between 25 kW and 50 kW. Larger installation remunerations are determined on a case-by-case basis. The program also provides rebates of $0.75 per kWh saved in the first year for solar water heating systems.

Are there energy efficiency programs sponsored by the state government?

No state energy efficiency programs are currently available to Federal customers. For information on future opportunities, contact the state's energy office at the Arizona Department of Commerce.

What additional opportunities are available to me?

Federal customers whose utilities have area-wide supply contracts through the General Services Administration (GSA) (e.g., Arizona Public Service and Tucson Electric Power), may be able to take advantage of third-party financed energy efficiency projects called utility energy service contracts (UESCs). Information is available through the GSA Energy Center of Expertise Library. Federal facilities should contact their account executive to determine the level of each utility's participation.

NOTE: Energy efficiency funds and demand response programs are updated at least annually. Please contact the FEMP webmaster if changes are needed between updates.