Why You Should Own Your Solar System: Buying vs. Leasing
Date: January 12, 2018
Written by: Meghan Harmon
We Want to Save You Money
What you will pay in energy costs over the course of ten years is higher than the cost of financing a solar system. If your average bill is $350, in ten years you will pay $42,000 (ignoring the annual rate increase). Our company can build you a system to offset 100% of your monthly power bill for much less than that.
There has never been a better time to go solar, and purchasing your system is the best route. Our CEO Chris Moran confirms, “Solar prices are less than half of what they were just four years ago. Additionally, the cost of electricity has gone up by almost 25% in the same period.” There are many financing options available, and it can be overwhelming. Consumers are frequently mislead into thinking leasing their system is a better option because it is a less expensive. We’ve done the math, and purchasing a system will actually save you more in the long run.
Purchasing can be overlooked because people are under the impression that you must have cash on hand to invest. Similar to leasing, there are options that include no out-of-pocket cost. The great thing about financing your solar project is that it is under your terms. Our sales consultants work with you to build custom financial plans. This way, you’re able to pay off your system as soon as you’re able, while keeping your monthly payments lower than your current energy bill. Because your monthly costs will be reduced, these $0 money down options mean instant savings.
Leases can oftentimes be as long as 20-25 years, and solar loans offer much shorter terms. With a leases and PPA’s, you will have set monthly payments that increase anywhere from 1-3% annually. There are designated points during your contract that contractor will allow a “buy-out”. A buyout is when you purchase the system for then market value. Unfortunately, the majority of leasing companies will not allow a buy out before 5 years of ownership, because they want to take advantage of the full depreciation on your system.
Both options, whether you’re leasing or purchasing, will offer a manufacturer warranty to cover performance, defects, panel integrity, and possible environmental factors that can cause premature wear. However, it is the responsibility of the homeowner to identify these issues so that it doesn’t affect long-term savings (low production causes higher bills).
Overall, the decision is yours. We at Solar Negotiators hope we’ve provided you with the tools to make an informed decision about how to approach your solar project.