Tucson’s combination of abundant sun and rising utility rates creates a strong economic case for solar. TEP customers can see meaningful bill reductions, though savings depend heavily on how well your system production aligns with time-of-use pricing windows. Key factors that shape your outcome:
Which TEP rate plan you’re on (Time-of-Use vs. Demand)
Roof orientation, age, and shading
Whether battery storage makes sense for your usage pattern
Your average monthly consumption and peak usage hours
Tucson Electric Power (TEP) is the primary utility serving Tucson homeowners. Understanding how TEP compensates solar customers is essential before sizing a system.
Tucson Electric Power (TEP)
TEP does not offer traditional net metering. Instead, solar customers are compensated under a net billing program using the Resource Comparison Proxy (RCP) export rate — currently around $0.057/kWh — which is well below the retail rate you pay for power. TEP requires all solar customers to be on a Time-of-Use (TOU) rate plan, meaning when you use electricity matters as much as how much you use. Battery storage is worth considering for TEP customers who want to maximize the value of their solar production rather than exporting at the lower RCP rate.
Bottom line: TEP’s below-retail export rate means solar systems in Tucson are best designed to maximize self-consumption rather than grid export — which changes how a good installer should size and configure your system.
Most residential systems in Tucson run between 6kW–10kW, with pricing averaging around $2.60 per watt before incentives. Battery storage is increasingly common given TEP’s low export rate — keeping production in-home is more valuable than selling it back. Financing options include cash purchase, solar loans, and lease/PPA arrangements. Before comparing price per watt across quotes, evaluate projected self-consumption, TOU rate alignment, warranty terms, and the installer’s local TEP experience.