Buying vs. Leasing Solar Panels: What You Need to Know

Deciding to switch to solar is a big step. The next step is deciding whether to buy or lease your solar panels. Buying your solar panels means you either purchase with cash or take out a solar loan or home equity loan that you can pay off and eventually own your solar panel system outright. Leasing your solar panels essentially means you rent them, and the company you rent them from has ownership of the system for the duration of your lease contract. There are advantages and disadvantages to both buying and leasing, and what is the best choice for you depends on your current circumstances, goals, or plans.

LEASING

Advantages to Leasing

  • You will see immediate savings after the installation of your solar panel system (with many lease agreements including $0 down and no installation fees, your electricity bill will instantly be smaller).
  • You do not have to cover any maintenance fees on your solar panel system when it needs servicing. The company you lease through provides all maintenance and service.

Disadvantages to Leasing

  • Leasing typically comes with a 20-year contract, on average, and you typically cannot break your contract or sue the company if you are unhappy with your solar panel agreement.
  • Your savings on your electricity bill will be minimal, since the lease company receives the financial incentives from your solar panel system and they will charge you for the energy you produce from your solar panel system.
  • You are essentially renting the solar panel system, so you will never own it outright, but you will continuously pay for it through lease fees. If you ever choose to purchase the panel system, you could pay thousands more to buy out of your lease agreement.
  • Leasing is not eligible for financial incentives, such as tax credits (including the 26% federal solar tax credit) or rebates from the state or energy grid. The company you lease through receives these financial benefits instead, as well as any extra energy you produce.
  • You will never eliminate your energy bill entirely, as you could through buying, since the extra energy produced by your solar panel system does not come back to you in the form of energy credits, but rather goes to the company you lease through.

BUYING

Advantages to Buying

  • You own your solar panel system outright. Even if you make payments on it through a loan, your payments go directly toward the installation cost and eventually will be paid off.
  • Solar loans or home equity loans for solar panel installations come with low interest and low monthly payments, making the cost of installation easier to manage.
  • There are $0 down solar loan programs, so you can see an immediate difference in your electricity bill and start saving on your energy costs right away.
  • You will qualify for many financial incentives, tax credits, and rebates from the federal government, state, or energy grid (including the 26% federal tax credit).
  • Any additional energy you produce through your solar panel system may be eligible for net metering, which is when the surplus is sent to the energy grid and you receive a credit on your next electricity bill.
  • Many solar panels come with a warranty (some for 20 years!) so repair costs are covered through a warranty.**
  • After the payoff of your solar loan or home equity (or if you pay with cash up front), you could potentially eliminate your electricity bill!

Disadvantages to Buying

  • If you don’t get a $0 down solar loan, there can be a large down payment required for your solar loan. Ask your loan provider if there is a down payment required for a solar panel installation.
  • You are responsible for the cost of maintenance and service (however, a warranty may cover some of these expenses).

Whether you decide to lease or buy your solar panel system is entirely dependent on your future goals and plans.

If you’re just looking for a one-stop shop and are mostly interested in solar panels for the sake of green energy and have no plans of moving or relocating, leasing may be a good option for you. However, you will see minimal savings on your electricity bill because the lease company keeps all the credits and rebates. Furthermore, unlike ownership, solar users with a lease have a lien on their property for the length of the lease, so if you ever go to sell your home, you will either have to buy out the solar panel system anyway or wait for the lease to expire.

On the other hand, buying and owning your own system provides you with quick payback and many years of free electricity and real profits. If you are interested in saving more money, owning your own system, and receiving financial incentives plus the satisfaction of green energy, buying your own solar panel system may be for you, and it is simpler than you think. Finding a professional company to perform the installation plus having a professional team assist you with rebate paperwork and service appointments makes the ownership of your solar panel system affordable and simple.

If you would prefer to save more money with a solar panel installation by buying, the difference over 25 years could be up towards $12,000 in savings*. The savings on your electricity bill can range from 70-100% off your regular cost of electricity, and these savings essentially pay for the cost of your panel installation in as little as 5-7 years***.

Higgins Energy is ready to help you take the next step into switching to a solar panel system. Our sales team is here to answer your solar questions and help you fill out and finalize rebate paperwork. Our service team is professionally trained to install and service your solar panels so you can see savings for the entire lifespan of your solar panel system.

Ready to make the switch? Give us a call at 978-355-6343 to schedule your solar appointment and see the difference solar can make in your home!

Sources

Address

Higgins Energy Alternatives, Inc.
140 Worcester Road
Barre, MA 01005

Hours

Monday: CLOSED
Tuesday: 9:00am - 6:00pm
Wednesday: 9:00am - 6:00pm
Thursday: 9:00am - 7:30pm
Friday: 9:00am - 6:00pm
Saturday: 9:00am - 4:00pm
Sunday: CLOSED

Contact

Phone: 978-355-6343
Text Us! 978-355-6343
Toll Free: 800-424-6343
Fax: 978-355-4582
info@higginsenergy.com