Solar Leasing = $600 Annual Savings For Middle-Class Families


Photo Credit: 401(K) 2013 / Foter / CC BY-SA

In states where it’s available, solar leasing is extremely popular. Approximately 75% or so of homeowners who go solar in these states decide to go solar through a solar leasing/PPA option. The big stat of the day today is that middle-class families who go solar in this way are projected to save about $600 a year off their electricity costs. That comes to about $12,000 to $15,000 over the course of their 20- to 25-year solar lease or PPA. That’s of course practically the same as making an extra $12,000 to $15,000, but without having to pay taxes on the money.

A lot of people contend that solar leasing rather than simply buying a solar power system is a rip off, since you’re theoretically giving away some of your profits from going solar to the solar leasing company. However, there is a reason or two that such a huge percentage of people go solar through a solar leasing service when given the option.

The biggest one is probably the simple fact that a lot of people don’t like paying for things up front. The average person would rather pay more in the long run, sometimes a lot more, if they can take their time making the payment.


Another thing to keep in mind is that solar leasing companies are often able to take advantage of solar energy tax incentives that the common person can’t take advantage of. This includes the 30% federal tax credit as well as Modified Accelerated Cost Recovery System (MACRS) and sometimes state tax credits. With those bigger government incentives, these companies can cut into their own potential profits a bit to make sure consumers get a great deal, perhaps even better than they’d get by buying their own solar power systems. (But, as always, I recommend checking out all your options and running the numbers.)

Other smaller but still notable benefits include the performance guarantees, monitoring, and maintenance that is generally covered by solar leasing/PPA companies. The peace of mind that comes with not having to worry about any of that is quite valuable to a lot of people.

For those three reasons, the majority of people who go solar and have an option to go with a solar leasing service do so that way. Look into whether or not that’s an option for you!

Cost of Solar, Market Research

October 14, 2013

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