Solar Power – Part 1 – Lease or Buy?
We are sharing a multipart commentary on the idea of going with solar panels for your home.
The state of California has set new rules for compensating rooftop solar panel owners. Previously only those home owners with tens of thousands of dollars upfront could afford to buy and install solar panels on their roof. In recent years there has been an array of leasing and financing options.
So now what? Should you lease or purchase? Go solar now or later? First and foremost we will to educate you on the differences between buying vs leasing solar panels.
Buying and owning your solar panels:
1- You get all the advantages of the Renewable Energy Credits including the Federal Tax Credit for solar energy (up to a 30% rebate on your tax return for 2016)
2- All the collected energy from your solar panels goes to you and most home owners will end up paying very little to their electric utilities (except in cloudy weather).
3- You can legally sell the solar panels before or during the sale of your home, potentially receiving a higher green premium on a new appraised value. Many home buyers now recognize solar power as a justifiable premium and value when on the market for new property.
Leasing your rooftop solar panels:
1- You can’t claim ownership or get credit for a federal tax rebate.
2- The solar leasing company owns the power generated from the panels on your roof, and though you may get a slight reduction on your monthly bill, you are still paying the solar leasing company for the electricity used from the solar plans. In essence the solar leasing company becomes one of your electricity providers and may still have to pay your traditional utility when not enough solar electricity is generated for your home.
3- Transferring your property, such as in a home sale with a solar lease may be problematic. Solar leasing contracts often require the new owner to take over the lease terms and becomes unattractive to home buyers.
At the end of the day it may be beneficial to buy your solar panels through PACE financing and the HERO program.
