Buying Solar Panels Vs Ppa

Buying solar panels requires an investment and more decision making than leasing but over the long term the benefits of owning your system are hard to beat.

Buying solar panels vs ppa. One of the most widely utilized financing mechanisms for solar power is the power purchase agreement or ppa. Solar lease usually 20 to 25 years. For people who know nothing about solar panels inverters hardware and other things involved with solar it makes it kind of tough to get companies to give their sales pitch. Buying your system with cash.

A solar ppa works more like your utility bill where you pay for each kilowatt hour kwh of solar energy you use. Sounds like leasing is not very good from what i have read. If you lease the system or sign a power purchase agreement ppa a third party owns the solar panel system. Ppa financing utilizes a third party to build own operate and maintain the system while the customer agrees to buy 100 of the electricity generated by the system.

Solar ppa usually 20 to 25 years. If renting is more appealing you can lease the system or enter a ppa power purchase agreement wherein you get a new rate of electricity kwh instead of the one the utility gives you more on this later. What is a solar ppa. A solar system can either be purchased with cash outright or through a loan.

The main difference between buying and leasing a solar system is ownership. In this article we ll explain how solar leases and ppas work then compare the pros and cons of these agreements vs. Solar loan 1 to 25 years available through solar dealers contractors and online from sungage financial green sky finance enerbank and other green energy or home improvement financing companies. Between buying leasing and ppa it gets confusing.

If you lease the system or sign a power purchase agreement ppa a third party owns the solar panel system and you are not entitled to incentives tax credits. The main practical distinction between buying and leasing a solar pv system is in ownership. Your solar ppa bill will fluctuate depending on how much energy the solar panels produce. The price you pay per kwh with your ppa will be lower than the price your utility charges you per kwh.

With a solar ppa instead of paying to rent the solar panel system you agree to purchase the power generated by the system at a set per kwh price. In simple terms a solar lease or solar ppa is a rental agreement between a solar installer and the homeowner.