Solar Lease

Are you thinking about participating in a solar leasing program instead of buying ? Better take a closer look before you sign away your rooftop's valuable real estate for the next 12 to 15 years, for a mere 10% savings in your electric bill.

Read the comparisons below and you'll probably find that in the long run, a solar lease simply does not make financial sense.

Who Gets What ?

Benefits/Drawbacks	With No Solar	Solar Lease	Buy Solar
30 % Tax Credit	No Tax Credit	No 30% Tax Credit to you. The tax credit goes to the solar leasing company because they own the equipment.	Tax credit applies to you because you own the solar system.
Cash Rebate From Utility Company.	No Cash Rebate.	No Cash rebate to you. The cash rebate goes to the solar leasing company because they own the equipment.	Cash rebate is awarded to you because you own the solar system.
Stable Monthly Cost.	Electric Rates Have Continually Risen For Decades.	Monthly solar lease payments are increased on an annual basis. An annual lease payment increase of 3.9% each year for 15 years is not uncommon. Beware of this one. It's usually buried in the fine print.	Fixed interest payments are available from many sources which can lock in your investment. The US Department of Energy publishes a consumer guide for financing solar systems. Click here to download a PDF version of their guide.
Reduction Of Your Current Electric Bill	No Reduction, Your Electric Rates Will Continue To Rise Year After Year.	A solar system which is currently being recommended by a popular solar leasing company for a $249.00 per month electric bill in Edison territory would reduce that electric bill by $117.00 per month. The lease payment would be $132.00 per month so your monthly savings with a solar lease program would be about $15.00 per month. $15.00 per month ? Why would anyone let these people climb on their roof for a couple of days, drill lots of holes, install all of that equipment, be legally bound to a solar lease for up to 15 years on equipment that they won't own in the end, all for a savings of only $15.00 per month ? We're not exaggerating, you can visit these websites and use their online lease calculators to see the numbers for yourself.	When you purchase a solar system, you own the system. So unlike a lease, when you finish paying off your loan you're done, that's it. The money that your system will save you on your electric bill will have increased over time because electric rates will rise and this non-taxable income will go right into your pocket year after year, decade after decade.
Consequences or benefits when selling your home.	Homes with a solar system can sell for more money than homes without solar system.	If you cannot get your home's buyer to qualify for the solar lease (Remember your home's buyer must have excellent credit to qualify for the lease) or if your home's buyer is not interested in assuming a lease on the solar system then you are obligated to the lease. You cannot break the lease without financial consequences.	Homes that are sold with a solar system included in the purchase price can sell for more money than homes without a solar system. Since you bought the solar system, you own it and you can do whatever you want. You can move the system to your new home or you can sell the system as part of the home's sale which will improve your home's Sale Price and it's marketability.
Solar System Ownership/Equity After Completion Of Financing.	No ownership or equity because no system was installed. You will continue to rent evermore expensive electricity from the utility company.	After paying 15 years of lease payments, you will have zero ownership and will have no equity in the solar system. You will have the option, of extending your lease payments, you may also buy the system even though you've been paying for it for 15 years or you can have the solar leasing company remove the system from your roof. (Ouch, how will they match all of that 15 year old roofing material ? Who say's that they'll even try.)	After you complete the financing of your solar system, it will continue to produce free electricity for many years to come. In fact the solar panels typically come with a 25 year warranty and have a life expectancy of more than 40 years. Inverters which have a 10 year warranty, have a life expectancy of 12 years. Inverters constitute a relatively small percentage of the overall solar system cost and are expected to drop in price over the life of your system.
Renewable Energy Credits (RECs).	No Renewable Energy Credits.	No Renewable Energy Credits to you. The Renewable Energy Credits go to the solar leasing company because they own the equipment.	Renewable Energy Credits apply to you because you own the solar system.
System Maintenance.	No system maintenance. Only a high monthly electric bill to maintain.	No System Maintenance When You Lease A Solar System. That's a good one ! What maintenance ?	That's the beauty of owning your own solar system. A properly installed solar system needs virtually no maintenance other than a good rain or a rinsing off every few months of accumulated dust on the solar panels with a simple garden hose.
Benefits/Drawbacks	No Solar	Lease Solar	Buy Solar

The above examples applies only to current incentives. With all of the potential incentives that have been proposed, the scenario only worsens for someone who leases a solar system. For example imagine that your state or federal government enacts a feed in tariff similar to Florida or Germany or Canada and allows existing installations to participate in the premium cash payments for solar energy production. Guess who benefits ? Again it will be the leasing company because they own the system that you are making payments on.

Oh, and if you decide to participate in the feed in tariff program by installing your own solar system on your roof, guess who has to pay a penalty for breaking the lease agreement ?

Judge for yourself, when it comes to benefits, it appears that the solar leasing company is the clear winner. In our opinion, If you want the most from your experience with solar energy then owning your system, especially at today's record low prices gives you the most benefits. After all, if buying a solar system didn't make financial sense then why are all these leasing companies buying solar systems, taking all of the incentives for themselves and then turning around and leasing the equipment to homeowners ?

Hey it’s great to go green, but with up to a 50% reduction in pricing since only a year ago before incentives, and new solar feed in tariff's popping up all over the country, why not go green and put a lot of extra green in your pocket by buying a solar system instead of leasing.