Electricity Rate in Arizona (2026): 15.59c/kWh Average

Arizona electricity averages 15.59 cents per kWh for residential customers as of March 2026, according to the EIA Electric Power Monthly. This is 2.97c below the US average of 18.56c/kWh. The average monthly bill for Arizona households is $156 based on typical usage of 1019 kWh.

Arizona electricity is served by three large utilities with very different structures: Arizona Public Service (APS), an investor-owned utility regulated by the Arizona Corporation Commission (ACC), serves most of the state including Phoenix and northern Arizona. Salt River Project (SRP), a quasi-public power district governed by elected ratepayers rather than the ACC, serves the eastern Phoenix metro (Mesa, Tempe, Scottsdale). Tucson Electric Power (TEP), an investor-owned subsidiary of UNS Energy, serves Tucson and southern Arizona. Arizona does not permit residential retail electricity choice - each address has a single regulated supplier. The primary rate driver is summer cooling load: Phoenix averages over 110 days per year above 100F and household consumption frequently exceeds 1,400 kWh/month in July and August, two to three times winter consumption. APS and SRP both operate aggressive Time-of-Use plans where peak summer afternoon rates run substantially higher than off-peak overnight rates - shifting cooling load to overnight pre-cooling with smart thermostats meaningfully reduces bills. Arizona is the third-largest US state for residential rooftop solar installed capacity, but the ACC's 2017 decision to end traditional net metering for new APS solar customers (replaced with an export rate well below the retail rate) extended typical solar payback periods from approximately 7 years to approximately 11-13 years for new installs. SRP customers have a separate solar export structure with a demand charge component. Net-metering rules and the appropriate solar economics depend strongly on which utility serves the property.

Generation mix: Natural gas 40%, nuclear 25%, solar 20%, coal 15%. The fuel mix is a primary driver of electricity rates - states with abundant hydro or nuclear tend to have lower rates, while states dependent on imported petroleum (Hawaii) or natural gas pay more.

Year-over-year change: Arizona rates rose 3.0% year-over-year as of March 2026. This compares to the US average increase of 8.6% over the same period.