Solar Lease vs. Purchase

The Great Divide: Ownership vs. Third-Party

When you decide to go solar, you must make a fundamental choice: do you want to own the power plant on your roof, or do you want to rent it? This decision dictates who receives the tax benefits, who handles maintenance, and how much money you ultimately save.

Purchasing Solar (Cash or Loan)

When you purchase a system, you are the legal owner of the equipment.

• The Financials: You pay for the system upfront with cash or finance it through a solar loan. If you use a loan, your monthly payment replaces your old utility bill.
• The Incentives: Because you own the system, you receive the 30% Federal Investment Tax Credit (ITC) and any local rebates (like SRECs).
• Home Value: Owning a solar system increases the resale value of your home. Studies show buyers are willing to pay a premium for a home with owned solar.
• The Bottom Line: Purchasing provides the absolute highest long-term financial return. Once the system pays for itself (usually 6-10 years), the electricity is free for the remainder of its 25+ year lifespan.

Solar Leasing

With a lease, a third-party solar company installs and owns the system on your roof. You sign an agreement to pay a fixed monthly "rent" for the use of the equipment.

• The Financials: Leases usually require $0 down. Your monthly lease payment combined with your new, lower utility bill should be less than your old utility bill.
• The Incentives: Because the solar company owns the system, they take the 30% Federal ITC and all local rebates. You do not get these tax credits.
• Maintenance: The leasing company is 100% responsible for monitoring, repairs, and maintenance. If the inverter breaks, it's their problem, not yours.
• Home Value: Leases do not typically increase home value. If you sell the home, you must convince the buyer to take over the remainder of the lease contract, or you must buy out the lease yourself.

Which is Right For You?

You should Purchase if: You want to maximize your financial return, you have the tax liability to benefit from the 30% ITC, and you want to increase your home's resale value.

You should Lease if: You have zero tax liability (e.g., you are retired and don't pay income tax), you want a completely hands-off experience with zero maintenance anxiety, and you plan to stay in the home for the duration of the 20-25 year lease.