Leasing solar panels lower your carbon footprint and can provide you an excellent ROI despite the long duration of your solar lease. Solar leasing allows you to own a solar panel system without having to worry about the hefty price tag or complicated maintenance that comes with it. The leaser will pay a fixed monthly rate to a leasing company that owns the solar panels for this agreement.
How Does Solar Leasing Work?
When you have a solar lease, you can enjoy big savings on your electricity bill. But you’re also not contributing to the earth’s climate issues. Although buying solar panels may provide a significant return on your investment, you may not have the cash on hand to pay for its upfront costs.
The average price of a solar installation runs about $20,000. Due to this high cost, leasing a solar energy system has increased in popularity. And given the oncoming expiration of federal and state programs that provide financial assistance for homeowners looking to install solar systems, leasing a solar panel system is likely to increase further.
Thankfully, there are many financial and leasing options to help you make the switch to solar energy.
Is a Solar Lease the Same as a Solar Purchase Power Agreement?
Many homeowners think leasing is the same as a solar loan and a Solar Purchase Power Agreement (PPA). However, the three are very different.
With the lease and a PPA, you will not be the legal owner of the solar system. With a lease, the rate you pay will be the same despite the energy your solar panels generate.
Meanwhile, a PPA has a set price per kWh of solar energy that is produced. This means you will pay more if your panels produce more electricity and less if you produce a small amount of solar energy.
Is a Solar Lease the Same as a Solar Loan?
A solar lease is also not the same as a solar loan. Some people prefer to take a solar loan so they can save more money. If you get a solar loan, you can purchase a solar power system and pay for it over time.
Leasing Solar Panels vs. Leasing a Car
It’s important to note that leasing solar panels is very similar to renting a vehicle. You can enjoy the energy you produce without being the owner of the equipment. Not only that, but you also don’t have to be responsible for its cleaning and maintenance.
When it comes to leasing a solar panel system, your task is to make monthly payments.
Despite the similarities between renting a vehicle or a solar panel, the terms, and agreements of the two differ. First, if you rent a car, it doesn’t automatically mean you will save money. With solar panels, you will enjoy instant savings.
Duration of the Lease
Another major difference between renting a car and a solar panel is the duration of the lease. Although you can rent a car for a few days, the same thing cannot be said for a solar energy system. The leasing contract usually spans two decades or more.
What About Buying Solar Panels?
Two of the most common ways to get a solar energy system for your home are buying solar panels or leasing them.
When buying solar panels, you can take advantage of the federal tax credit. More than that, the value of your home will also increase by $12,000 to $15,000 if you want to sell it, and it will also get sold faster on average.
When you lease panels, your home value will probably remain the same. This means that buying solar panels is a better idea if you want to move in the future.
If you still don’t want to get into buying solar panels, you must take into account looking for a potential buyer that wants to transfer your lease to them. Traditionally, many potential house sales failed to happen on potential homebuyers refusing to sign lease contracts.
Fortunately, this may not be as difficult as you think today. More people seem willing to transfer solar leases than in the past. A recent study found that more than 3 out of 4 solar panel leases were transferred to new homeowners upon the home sale.
Who Should Lease Solar Solar Panels?
Leasing solar panels is a great option for everyone who wants to enjoy electricity savings, especially those who do not have the money to invest in installing a solar system in their home.
Leasing is also an amazing option for those who want to use solar panels immediately in another property or those who want to decrease their electricity bill without worrying about solar panel maintenance.
Advantages of Leasing Solar Panels
Here are the various benefits you’ll enjoy from leasing a solar panel system.
Lower Carbon Footprint
The major goal of people who switch to solar power aside from savings is to not contribute to greenhouse gases released in the atmosphere.
Solar panels reduce carbon dioxide and pollutant levels that are released into the air. These pollutants are not only dangerous to plants and animals, but they can also contribute to climate change.
Additionally, solar energy systems can save water compared to geothermal energy systems that need water to produce electricity.
Leasing a solar system will enable you to save money on utilities. When you go with a solar lease, you can significantly reduce your electric bill.
However, this also depends on factors like your power consumption, the size of your roof, and the amount of shadow and peak sun hours your home receives.
You will start saving money from day one after installation. Because you don’t own the panels, you don’t have to worry about maintenance and service or other unexpected costs that are bound to happen down the road. For those purchasing solar panels, it can take years to get back their investment. So why wait? Leasing solar panels can be an excellent alternative to enjoy benefits today.
The Sun Is Not Depleting
If you live in a sunny area like California or Florida, you will enjoy solar energy throughout the year, and you will enjoy the same amount of sun two decades after you lease your solar panels.
This is because the sun is not a depleting source of energy. This makes it more reliable and less susceptible to shortages in source materials like fossil fuels that can rapidly increase the price of electricity.
One of the best things about solar panels is that technology keeps improving. Technology in the industry evolves fast, and these improvements are set to increase solar panel efficiency and effectiveness. When you lease instead of purchase solar panels, you can enjoy the benefits of different innovations.
Unlike gadgets like phones, solar panels are a long term investment, and it’s made to last for a long time. You’ll also be able to renew your lease to a newer model the moment your agreement ends.
You can use solar energy in many ways, such as powering a home that’s not connected to any grid. There are tons of homes that use solar energy to improve their power efficiency, and this system even comes in handy if your area experiences power or water interruptions.
Steps in Leasing Solar Panels
Here are the steps you need to follow if you want to get a solar lease.
The solar industry is now booming. Many companies can deliver great products at a low rate for those who want to lease solar panels. A solar lease is a wonderful long-term investment that you can benefit from, so you need to make an informed decision.
Don’t be afraid to ask clients for reviews for the solar companies you are considering.
Choose a company that has a wide array of solar panel options like the Trina Solar Panel and the Tesla Solar Panel. It is also recommended to compare different quotes by installers with proven track records and those already familiar with the entire process, such as building permits.
Examine Your Energy Bill
If you want to maximize the solar lease in your home, you need to base its size on your electric consumption. To do this, take a look at your average monthly bill.
The journey toward using a solar power system starts by having a clear understanding of your home’s power usage by checking all your utility bills for the past year.
Also, think about seasonal changes such as summer and winter, how much time you spend in your home, the number of people who live there, and your home size. This information will help you get a picture of the size and type of the best-suited system for your needs.
If you want to go the extra mile, you can also do a home energy audit to know which of your appliances consumes the most power and how to reduce its energy consumption. Investing in energy-saving light, heating, and appliances is also a great option.
It would help if you also weatherized your home, and this involves insulating your house and sealing air leaks to help retain its heat during the winter season.
Know How Solar Would Work in Your Home
Before you get a solar lease, you need to know your home’s contact with scattered and direct sunlight. Panels produce energy from any form of sunlight, but direct sunlight works best. You can examine your solar potential by observing the sunlight around the area or seeking help from your solar company.
After examining your home, the solar company will recommend the best size of a solar panel installation by considering factors like your roof area and direct sunlight.
Do You Still Want to Lease Solar Panels?
If you want to save money and enjoy peace of mind when it comes to service, performance, and practicality, leasing solar panels are the way to go.
If you decide to lease your solar energy system, you can enjoy renewable energy for your home and reduce your electricity cost immediately.
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