Installing a solar panel on your home is undeniably a good move. But for some, it’s not exactly an affordable one.
We don’t need to tell you about the many benefits of having a residential solar panel system. Not only does it help you lower your carbon footprint and save the environment – which is in dire need of saving – but it also lowers your monthly utility bills and ends up saving you money in the long run.
The problem is that the upfront cost of installing solar panels is expensive. In this post, we’re talking about leased solar panels. If you don’t know what this is or what it means, keep reading and find out how leasing solar panels can still give you some of those amazing benefits.
What Are Leased Solar Panels?
Basically, leased solar panels are panels that a solar panel company owns, which you pay a fixed monthly payment to use. Usually, the solar installer will work with a separate leasing company to work out the terms of the lease. The installer will come and install the panels on your home and you’ll get all of the benefits of having solar panels on your house.
During the course of the lease, you end up swapping your bills from the utility company with the cheaper bills from the solar lease.
How Does a Solar Lease Work?
In some, but not all situations, your solar panel system could eliminate your electricity bills altogether. However, you’ll still have to pay the monthly solar lease payment. So, if your utility bill is $175 per month and your panels cover all of your energy usages, but your solar lease payment is $100 per month, you’re still saving $75 per month.
The terms of each solar lease will differ slightly. Typically, you’ll sign the solar lease agreement for between 20-30 years, which is roughly the lifespan of a solar panel system. There are usually price increases built into the agreement to reflect the rising cost of electricity.
Lastly, if you decide to move, you’ll have the option to transfer the lease to the new homeowners.
Advantages and Disadvantages of Leasing Solar Panels
There are many advantages to leased solar panels, many of which we’ve already discussed. Unlike with purchasing solar panels, there aren’t any upfront costs to installing a leased solar panel system.
All you’ll pay is your monthly lease fee, which will be the same every month, and whatever your leftover energy costs are (if there are any). You also have the benefit of never having to worry about system maintenance or monitoring.
There are a few disadvantages to consider with leased solar panels. One is that you’re not eligible for any of the tax breaks and incentives associated with owning solar panels, which can amount to as much as 25-50% of the cost of installing them.
It’ll also be potentially more difficult to sell your home with a solar lease if you can’t find a buyer that wants to take on the lease.
Are Leased Solar Panels Right for You?
Now that you know a bit more about leased solar panels, it’s time to decide if this is the way to go? It’s a great option for those that might not have the funds to cover the cost of installing solar panels, but you do miss out on a few major perks of solar panel ownership. Weigh the pros and cons and make a decision that’s best for you and your household.
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