Should You Consider Getting Solar Leasing?

Should You Consider Getting Solar Leasing?

Homeowners who might not have the money to install solar panels on their roofs now have complete access to solar energy, thanks to solar leasing. Solar panels used to be so costly that most households couldn’t even afford to install them. 

Here is where the solar sector was transformed by solar leasing. With a lease, homeowners might take advantage of all the advantages of solar without worrying about the up-front expenses by making a monthly leasing payment. 

However, solar is now 70% less expensive than it was ten years ago, making other solar financing solutions more practical that might offer more solar savings than a lease. Therefore, just because a solar lease has no up-front fees doesn’t indicate the best method to go solar. 

A solar lease is what? 

Similar to renting a car, leasing solar panels has identical rules. Although you provide a solar installer with a monthly payment, you do not own the solar panels. You receive all the solar energy that the panels generate in exchange, lowering your monthly power cost. 

Essentially, you are switching your utility company’s power bill for a lower payment from a solar leasing firm. 

A solar installation company often collaborates with a different leasing business to provide a solar lease. The installer must design, install, and maintain the solar panels. 

What distinguishes a solar lease from a solar PPA? 

Solar leases and solar power purchase agreements, or solar PPAs, are two solar financing solutions that are highly similar. 

A solarcompany installs a solar panel system on your house that you do not own through solar leases and PPAs. Instead, you make monthly payments for the solar energy the panels generate. 

No matter how much solar energy the system generates, the payment under a solar lease remains the same. Your contract with a solar PPA will specify a cost for each kilowatt-hour (kWh) solar energy generated. Your utility prices will be higher than this solar PPA rate. 

Therefore, the solar panels’ power will determine how much you pay each month under a solar PPA. For a solar lease, the monthly cost is constant regardless of solar output.