Should I lease or buy solar panels?

When it comes to leasing or buying solar panels, the best option for you and your energy needs will depend on your financial goals and preferences. Let's take a closer look at whether you should buy or lease solar panels for home.

Should I lease or buy solar panels - Does it really make a difference?

Whether you decide to buy your solar panels outright or lease them you’ll still get the same, clean solar electricity powering your home. But the finances and ownership of your solar energy system will change depending on whether you decide to own them outright or not. Let’s now talk about the differences between solar panel ownership, leasing, and Purchase Power Agreements (PPAs.)

Buying solar panels

Buying solar panels is a great option if you're looking to:

 1. Be the owner of your solar energy system

 2. Maximize the financial benefits of solar

What do we mean by "maximizing the financial benefits of solar"? Basically, if you buy solar panels outright (with one large upfront payment), you'll see more savings in the long run. That's because you won't pay monthly payments for years to your solar provider and, instead, will own the system from the beginning. That means you’ll achieve more overall savings sooner than you would by leasing your solar energy system. As a solar energy system owner, you can reduce your electric bill by using the power your solar system produces. We think this is one of the best reasons why people should consider buying their home solar panels without any financing.

Another way to maximize the financial benefits of solar, while minimizing its costs, is to claim a federal investment tax credit (ITC). Of course, you must be able to claim this tax credit, which depends on your tax liability. This can reduce your cost for solar panels.

Keep in mind that you can also finance your solar panels through a solar loan. A solar loan will still give you the home equity and tax incentive benefits that come with owning panels, without the large upfront cost of outright solar system ownership.

Let's recap. The key features of buying solar panels are:

 - Ownership

 - Maximizing financial benefits

 - Federal and state solar tax credits (if eligible)

Other options

Are you interested in reaping the benefits of renewable energy, but uninterested in owning the solar panels or system? If that sounds like you, leasing solar panels or purchasing power through a PPA (Power Purchase Agreement) could be a good option. Here’s why you might want to lease solar panels instead of buying or financing them.

Both a solar lease and PPA are affordable, easy ways to enjoy solar power without a large upfront investment. With both leasing and PPAs, you don't pay any upfront costs for your panels, and you can typically save on your utility rate. Additionally, your solar provider typically takes care of installation, maintenance, and the warranty because it maintains ownership of the panels.

What's the difference between a lease and a PPA?

Leases and PPAs are pretty similar, but they have one big difference: with a solar lease, you're paying a fixed monthly payment for the solar panels and system equipment, and with a PPA, you're simply paying for the solar power the panels produce, which will vary from month-to-month. Both options can help you save money, but availability varies by city and state.

Time to recap. Key features of a solar lease or PPA are:

 - No maintenance responsibility

 - No upfront cost

 - Lock-in your utility rate

Making your decision

Whether you decide to buy or lease solar panels, or choose a solar PPA, solar will help you shrink your carbon footprint and help everyone get closer to a more viable planet. And remember, our team is here to help. We can take a look at your financial goals and preferences, current price for power, and energy usage to help you find the perfect plan.

Get started with a free solar quote.