Adding solar panels to your house or business is a wonderful way to go green and reduce dependence on grid power. But you still have some tough decisions ahead of you. One of the most important ones is whether you should buy or lease the solar panels themselves. Each method has pros and cons that require careful consideration.
When you lease your solar panels, you don’t have to deal with the responsibility that comes with ownership. Typically, the solar company will install them for you, and they’ll be responsible for maintenance. Although you’ll have to pay them a monthly fee as part of this agreement, on the surface it seems like a better option than paying for panels outright.
This isn’t to say that you won’t save money. You most certainly will, though it won’t be all that much. When you lease your panels, the company gets any tax benefits you would have received. On top of that, they very well could raise your rates after an initial period.
One thing you’ll have to be extremely careful about is the length of the lease versus the time you plan to spend in your current home. If you want to move, you’ll either have to buy out your lease at a price set by the company, or the new buyers will have to agree to take it over. Although solar is attractive to hopeful homeowners, the loss of control through the lease is a highly off-putting factor.
When you buy your solar panels outright, you have to pay the costs upfront plus figure out who will do the installation and maintenance. However, you get to keep all the federal and state incentives that would have gone to the leasing company. This includes the government’s 30 percent purchase cover and whatever state and local grants, rebates, and subsidies you qualify for.
Depending on where you live, you may even be able to generate some additional cash through the panels. In some areas, you can get Solar Renewable Energy Certificates (SRECs) through the EPA. You get one SREC for every megawatt-hour of electricity you generate. You can then sell this certificate, helping to mitigate the cost of the panels and generating a profit after you’ve fully paid for them.
Most solar panels last around 25 years. Over the course of those years, a careful homeowner can easily recoup their costs. Even factoring in maintenance and potential insurance costs, the savings are substantial. On top of that, they’ll enjoy energy independence and little to no dues to the power company — though leasers will see some of these benefits, too.
One hidden benefit of buying your panels is that you have total control over where they’re placed. A solar leasing company will want to get the most profits they can. This means they may insist on putting panels less than aesthetic places — like the street-facing side of your roof. By buying your own panels and working closely with the installation company, you can strike a balance between placement and effectiveness.
Although the cost of solar panels has gone down in recent years, investing in green energy is still a big step for many homeowners. No matter what options you choose — buying or leasing — you’ll be one step closer to energy independence.
Though buying offers longer time financial gain, leasing still means energy savings and a lower carbon footprint. What matters most is that you choose the option that’s best for you. Just make sure you’re confident in your decision before committing to and installing your panels.
Photo by Adobe Stock/Smileus