With the rise of major solar energy leasing companies like SolarCity and SunRun, solar leasing has grown both in notoriety and adoption. This has caused many of our solar clients to ask us, “Should I buy or lease solar panels?”

At Action Air, we used to offer solar panel systems for both lease and purchase. Over time, we asked ourselves this question. After we analyzed the benefits of both arrangements, we decided to cut our lease offer and focus on selling systems.

Why You Should Buy Solar Panels Rather than Lease

While leasing solar panels seems like a great financial bargain with low or no upfront costs—and it is—much greater savings can be realized by owning your system. Some leasing programs offer fixed prices over the life of your system, but most offer agreements with yearly escalators that increase the cost of the electricity generated by your solar panels every year. These models make the assumption that electricity from the utility company will rise at the same or a higher rate every year, keeping your costs lower than they would be from traditional sources of power.

When you purchase your solar panels, no money down financing, tax rebates, and production incentives are available to you. With a lease agreement, these benefits all go to the leasing company. Financing a new solar array with a low-interest loan in can, in many cases, allow you have positive cash flow from day one with energy savings that exceed your monthly loan payment!

Owning your solar electric system rather than leasing can yield a return on investment (ROI) of greater than 20 percent. In California, the average purchased system pays for itself in less than 9 years, meaning you get at least 14 years of free energy after the initial loan is paid off.

Solar Lease vs. Purchase Comparison

	Purchase	Lease
Eligible For Federal Rebate	Yes	No
Eligible For State Rebate	Yes	No
Financing Available	Yes	No
Increases Home Value	Yes	No
Locked in Energy Costs	Yes	No
Own The System	Yes	No
Contracts Required	No	Yes
Down Payment Required	No	No
Pre-Payment Penalties	No	Yes*

*Pre-payment penalties vary by lease provider.

Want to Learn More About Solar?

If you want to learn more about solar installation San Diego and the surrounding area for your home or business, give us a call or fill out a contact form on the right. Our solar technicians can discuss the options that are available to you, assess your home’s solar potential, and even provide you with production and return on investment estimates!