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Arizona's renewable portfolio standard (RPS) seeks to meet a 15% renewables goal by 2025. Of this target, 30% is to come from distributed generation facilities, which is broken up into 50% residential systems and 50% non-residential, non-utility systems. The RPS includes solar, but does not have a specific solar carve-out. Arizona's larger investor owned utilities provide up front and production based incentives for residential and non-residential solar systems. These incentives tie customers into long term REC agreements. The current incentive structure keeps Arizona from having a viable SREC market.

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