Solar energy has become a popular renewable alternative to conventional electricity. Homeowners around the world are adopting it. Leasing is a viable option for many who cannot afford to purchase a solar system. It is then a question of whether leasing solar panels can save you money on your electric bill. Let’s get started.
1. Solar Panel Leasing: What You Need to Know
Solar panel leasing is similar to renting your solar system from a third party provider. This is how it works in general:
- Solar leases don’t require large upfront payments. Some may even offer zero down options.
- Fixed Monthly Payments – Instead of paying the electricity produced, you will pay a fixed amount per month for the solar equipment.
- Maintenance included: The majority of leasing contracts include maintenance to ensure the panels work efficiently and without additional costs.
2. Save money immediately
You’ll start generating electricity once your solar panels are in operation. It reduces, or even eliminates, the need to purchase electricity from the grid. This results in lower utility bills. The combined cost of your lease payment plus the reduced electric bill will usually be less than the original electric bill. This can lead to immediate savings.
3. Rate Protection
A solar panel lease offers protection against fluctuating electricity prices. Your monthly payments will be fixed with a solar panel lease. This offers predictability and stability.
4. Possible Downsides
Leases can offer immediate savings.
- Leasing Offers Less Savings Over Time: The cumulative cost over time of leasing a system can be more expensive than buying it outright or obtaining financing.
- Transferring the lease: If you are selling your home, it can be difficult to transfer the solar lease to a new owner. This could even deter potential buyers.
- Solar systems are not eligible for tax credits in many areas. These credits are usually given to the leasing company and not you.
5. The Difference Between Leasing and Buying: A Simple Example
Imagine you spend $100 per month on electricity. You could pay $40 per month for the solar lease and lower your monthly electric bill to just $20. This would save you $40.
If you purchased the system, however, your monthly payment would be $70. However, your electric bill might drop to $10, or even to zero. You could save $20 to $30 per month. After paying off the system you will own all energy savings, which can lead to a significant increase in long-term savings.
Solar panels can save you money, particularly in the short-term and without a large initial investment. The savings may not be as significant as buying the system in the long term. It’s important to take into account your financial situation, plans for the future, and any local incentives before making a decision. Compare multiple quotes and terms of contracts to get the best deal.
This post was written by a professional at Red Solar. Red Solar was started with the mindset of renewable energy being the future. We want everyone to travel through this transition. We can all agree that solar is the best way to reduce your carbon footprint, but it’s not the only way. During a Red Solar energy evaluation, all energy commons in your home will be analyzed for results. Our expert technicians will guide you through the process for better understanding and reassurance. Looking for the best solar panels Port Saint Lucie? Then contact us for more information today!