Skip to content
Solar Installer GuildUnited States · independent

Before you decide

Should I buy solar, lease it, or sign a power purchase agreement?

The short answer

Buying makes you the owner, which means you claim any incentives and you own the maintenance. A lease or a power purchase agreement puts a third party's equipment on your roof under a long contract — typically twenty years or more — and that contract has to be dealt with when you sell the house, which is where most of the regret in this category comes from.

The three arrangements

  • Cash or financed purchase. You own the system, you claim any incentives you are eligible for, and you are responsible for it. A loan changes the cash flow, not the ownership.
  • Lease. You pay to have the system on your roof and you use what it produces. The owner claims the incentives.
  • Power purchase agreement. You pay for the electricity the system produces, at a rate set in the contract, often with an annual escalator.

The clauses that matter in a lease or PPA

  1. The term, and the escalator: an annual percentage increase compounds over twenty years and is easy to skim past.
  2. Transfer on sale. Can the contract be assigned to a buyer, on what conditions, and what credit criteria must they meet? This is the clause that delays house sales.
  3. Buyout terms, and when they are available.
  4. Who owns and maintains the equipment, and who is responsible for roof penetrations and leaks.
  5. What happens at the end of the term: removal, renewal, or transfer of ownership, and at whose cost.
  6. Whether the arrangement places a lien or a fixture filing against the property.

Ask specifically how the agreement is handled when you sell, and get the answer from the contract rather than the salesperson. It is the single most common reason people regret a solar lease, and it surfaces years later at the worst moment.

Also asked

Does solar make a house harder to sell?

An owned, paid-off system is generally a feature. A leased system or a PPA adds a contract the buyer must agree to assume, which adds a step and can add friction, particularly if the buyer's lender takes a view on it. The distinction is ownership, not solar.

The long version

How to compare solar quotes

Price per watt, what a quote has to itemise, who actually underwrites the warranty, and where financing costs hide.

General information about solar and about hiring, not advice about your roof or your tax affairs. Incentives, net metering and contractor licensing are set federally, by state, and by your utility, and all of them change. The authority that publishes the rule is the current answer.