Owning vs. Leasing PV Systems

Benefits of Owning vs. Leasing PV Systems

  Solar energy is safe, reliable, and secure to tap. When installing a solar power system, the decision on choosing the finance relies on the goals. The primary differentiation between owning vs. leasing PV systems is ownership. If one is purchasing a solar panel system, they own it outright (buying with cash) or after completion of the loan. When opted for a lease, a third-party entity owns the system and enters into a power purchase agreement (PPA). These crucial differences define the cost, maintenance, financial offsets, terms, and conditions.

Installation cost

Solar panels cost between $15,000 and $30,000 depending on the power generation. When buying through cash, one can enjoy rebates, which cuts the total expenses by at least 50%. Many solar installers manage the paperwork to reflect the same in the final invoice. Users can also opt for a loan. When it comes to a lease, one can install the energy system with little or no money. However, the downside is that one does not enjoy the rebates, tax benefits, or incentives. The third-party entity that leases the panels enjoys the same.


If a user purchases the solar panels, then he or she is responsible for the maintenance. That said, solar panels come with a warranty, are durable, and have an extended lifespan. Therefore, there is less to worry about maintenance. Nonetheless, there is the absence of an application that tracks the performance of the system. When opting for a lease, the company owns the system and is responsible for the maintenance. Additionally, they give an application to the user that helps in keeping track of the performance of the solar panel system.


Solar loans are available from all the leading financial institutions. The repayment tenure is between ten and twenty years. The interest is dependent on the FICO credit score. For instance, if the purchaser has a score of 640 and above, the interest rate is between 3% and 8%. When it comes to leasing, the company leases the system for 20 or 25 years. After this period, the user can enter an agreement to continue the lease or purchase the solar panel system outright.


If a user is opting for purchasing the solar PV system, then the chances of saving the money range between 40 and 70 percent. Additionally, they enjoy free electricity for 25 years (lifespan of the PV system). When leasing, one saves between 10 and 30 percent of the total utility bills. It further depends on the property and incentives offered by the state. Before making a decision to own or lease a solar PV system, considering all the options as discussed above is essential. As every situation is different, choosing what is best for the property makes the difference.

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