What Residential Solar Plan Types are Available?
When you decide that solar panels are a suitable fit for your household’s energy needs, you might have different solar financing offers available to you. Residential customers have two distinct choices when it comes to home solar power system ownership: homeowner ownership and third-party ownership. According to the Clean Energy States Alliance (CESA), more than 60% of homeowners with solar panels utilize the benefits that come with third-party ownership. A third party, also known as a solar service company, handles your residential solar installation from start to finish, leaving you with a worry-free experience. CESA states that a homeowner who finances panels through a solar service company will typically have fewer concerns about proper system maintenance and operation.
As a solar customer, it’s also important to understand the differences between more specific financing options out there: solar energy lease, power purchase agreement (PPA), solar energy loan and upfront purchase. Financing options include various contract terms and responsibilities. Before choosing a specific solar financing option, you should research each offer to find out what will work best for your lifestyle and budget.
What other solar financing details should I consider?
When you research solar panels and financing preferences, it’s important to remember different solar service companies have different incentives and/or offers. These offers also depend on what state you live in. Our chart maps out some – but not all – differences among standard solar financing options.
|Solar Energy Lease||Power Purchase Agreement||Solar Energy Loan||Upfront Purchase|
|Payment explanation||Homeowner pays scheduled lease payments (usually monthly) to the developer||Homeowner purchases the system’s generated energy per kWh||Homeowner borrows money from a lender or the developer||Homeowner purchases the system in a lump sum or several payment installments|
|System owner||Third-party developer||Third-party developer||Homeowner||Homeowner|
|Who receives most of the federal/state incentives?||Third-party developer||Third-party developer||Homeowner||Homeowner|
|Who operates and maintains the system?||Third-party developer||Third-party developer||Homeowner*||Homeowner*|
|Contract terms||Vary||Vary, but most likely range 20-25 years||Vary||N/A|
* Certain state incentives require installers to provide a warranty for a set period of time, which decreases the risk of short-term issues due to improper installation.
SolarEnergyPlans.net can guide you toward a solution
Are you still deciding whether or not a solar power system is right for your home? SolarEnergyPlans.net can answer your questions and discuss a solar energy system with you. Call today and talk to one of our solar experts!
Source: www.seia.org; www.cesa.org. Updated: 9-9-15.