Anyone who has just begun to consider “going solar” will soon see that there are two different ways to make this happen. It basically comes down to the choice between leasing versus buying solar panels.
As you’ll see by the end of this page, there really is no advantage to leasing a solar power system.
This is unfortunate, as most homeowners that have adopted solar in recent years have signed long term solar leases.
The biggest players in the residential solar industry are pushing leases. They stand to make massive profits by offering leases with payments that are a little lower than what homeowners are currently paying. Of course, for millions of homeowners, proposed payments on a solar PV system are much higher than what utilities currently charge. In those cases, most homeowners decline the offer as it does not make immediate economic sense. This obviously helps to spread the misinformation that solar is too expensive.
These companies are essentially finding homeowners that are paying too much for their electricity and offering them a slightly lower price.
The companies offering these leases are basically looking to become the new power companies.
Instead, you can become the new power company of your neighborhood. This is the power of residential solar energy when purchased by a homeowner who takes advantage of net metering.
Leasing Vs Buying Checklist
|Lease or PPA||Purchase|
|Ability to get the most savings from solar possible||No||Yes|
|Eligible for the 30% federal tax credit||No||Yes|
|Eligible for a state tax credit||No||Yes|
|Your solar PV system increasing the value of your home||No||Yes|
|Your ability to take advantage of instant rebates||No||Yes|
|Possibility of a reduction in payments||No||Yes|
|Stable monthly payments||No||Yes|
|Possibility of prepayment penalties||Yes||No|
|Payments that reflect the actual cost of the system||No||Yes|
There are quite a few tactics that large solar leasing companies use to get homeowners to sign on the bottom line. Here are just a few….
- They’ll show a prospective customer how much their electric bill will increase as local utilities continue to increase their rates. They will say to lock in your lower fixed solar lease payment to avoid those increasing utility rates. What they won’t tell you is that those payments are based on a system that is 2 or 3 times the cost that it should be.
- They’ll say look – your solar lease is less than what you’re paying now and as utility rates increase, you’ll save thousands in the coming years.The truth is, you’d save a lot more by avoiding the lease and financing the system yourself.
- They’ll tell you that they will take care of everything – no need to worry about all of the maintenance and system monitoring. The uninformed solar customer might think these are ongoing, labor intensive chores. In fact, quite the opposite is true. Solar systems are virtually maintenance free.
The real bottom line is that you’ll be paying at least twice as much with a lease. Many homeowners can easily qualify for a $0 down FHA backed loan on a solar PV system. Payments on these loans can be considerably lower than what you’re currently paying for electricity. Find out the real cost of solar power or just fill out the form on this page and you’ll be contacted by a solar contractor who can assist you with the financing and installation of a solar power system.