It is a misconception that purchasing your solar system is your only choice: leases and PPAs are another great option available to homeowners. There are two ways to go about this: solar leases and solar power purchase agreements (PPAs).
Learn moreThere are many reasons why homeowners choose to finance solar with a loan, or purchase outright. These perks are only available when you buy your solar system.
With a solar lease, you pay a fixed payment every month. You pay to rent your solar power system, typically for about 20% less than you were paying for electricity.* You can still take advantage of potential energy savings, while making your monthly bill much more predictable.
Power Purchase Agreements (PPA) work much like solar leases, but instead of renting the system, you agree to pay a set price for the electricity the system produces.
With a solar PPA, you pay a fixed rate per kWh for all the electricity from your system that you use. Thus with a PPA, your payments will vary. How much you pay depends on how much power your system generates and how much power you use. To keep your costs low, you can try to offset the energy you use, and you may still see potential energy savings.
The main difference between leases and PPAs is that the payments remain the same during a solar lease and they vary with a PPA. However, both are great alternatives to purchasing a solar system. It ultimately depends on your situation and what financing option is the best fit for your lifestyle.
In general, leases and PPAs last 25 years. Many users often experience paying roughly the same amount at the end of their solar lease as someone who paid with a PPA.
