Incentive cuts squashing demand for solar in Arizona

Demand for solar installations is dropping in Arizona due to cuts in incentives.

Demand for solar installations is dropping in Arizona due to cuts in incentives.

Some Arizona utilities have cut the incentives they’re offering customers to install solar systems this year, prompting a dropoff in demand for such installations.

Arizona Public Service Co. and Salt River Project officials say demand still is there, but not at the same frenetic pace seen during the height of the solar boom two years ago.

“We’re working as effectively as we can to align the demand with what our incentives can pay out,” said Eran Mahrer, renewable energy director for APS.

APS has lowered its incentive rate twice this year — from $1.75 per watt to $1.60, then to $1.45. The decrease was part of the company’s plan approved by the Arizona Corporation Commission.

Sean Seitz, president of American Solar Electric Inc. in Scottsdale, said APS’ incentives are stepping down more quickly than the utility had suggested. The current incentive was supposed to bleed into 2012.

Read more in the Phoenix Business Journal.

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