So... Should I Get Solar, Using a Lease?

Solar leases can be a great investment. Itís simply a financial decision, like buying a bank CD (Is locking-in money at 2.9% for 5 years a good deal or not?) or refinancing your house (Should I refi now, or will rates go lower?).

The upsides of a solar lease:

1. With little or no money down, you will save on your electrical bill.

2. The lease company will maintain the solar system.

3. At the end of the lease, you will likely get to keep the system, at no additional charge.

Although the third bullet Ė a free solar system Ė is the interesting one, let's first discuss maintenance.

Maintenance The lease company owns that installation on your roof. Their contract also spells-out their duty to keep it operating for twenty years. If it breaks, that contract typically states that you will continue paying them your regular lease payments, but they will pay you for production lost while the system is down. Then it bogs down in minutia, but Iíll be honest - this small print doesnít really bother me, in that solar installations are very reliable, and when the inverter does fail (after 10-15 years) the lease company will be motivated to replace it. You might be required to mail them your monthly check for $300, and, because of the small print, they might be required to mail you a check for only $250 of missing power, but itís still rational for them to limit the number of $250 checks being sent to you, and fix the system.

You will likely get to keep the systemÖ Few electrical devices are worth anything after 20 years. Solar panels are interesting, in that they are very simple devices, and generally last more than 30 years. But their performance slowly degrades, so that a 20-year old panel is likely producing 80-85% of what it was producing when it was new. Right now thereís not much of a market for used panels. Thatís for three reasons:

1. Panels have gotten cheaper and cheaper,

2. New panels are guaranteed to work, whereas old ones come with an undefined risk, and

3. Panels are expensive to remove and relocate, and reattach.

Solar lease contracts are vague about this. In their lawyer-ese, they state that, at the end of the lease, you may contact them to extends the agreement, or contact them to have the panels removed. Then thereís this unaddressed area, of you not contacting them. If I were the lease company, Iíd sort of hope that you elected to keep sending me money. Iíd strongly hope that you didnít contact me to have the panels removed, since that will cost me a thousand dollars or more of labor, as Iím forced to remove the brackets, patch the holes, etc. And I wouldnít care at all if I never heard from you again!

Conculsion: Solar leases picked-up a bit of a sleazy reputation a few years ago, but competition has made the market a lot more honest. And with panels plummeting in price, the time is right to get solar on your roof - any way you can!

Call me, or send me an email, and Iíll point out a few other concerns I have with current leases. But be prepared to help me out too. Tell me what you like or donít like in the solar contracts youíve seen!

signature

next: Quiz: See if you understand this web site's lease promotion

Should I Lease a Solar Panel System?
 
Who Should I Lease From?
 
Are Some Leasing Companies Better than Others?
 
Leasing versus Buying
 
How Much Can I Save if I Lease Solar?
 
Explain the Different Variables in a Lease
 
The Escalator Trap
 
Can I Sell my House, if I have a Solar Lease?
 
So... Should I Get Solar, Using a Lease?
 
x

 
Quiz: Can you explain this solar lease promotion?
 
Understanding a Solar Proposal
 
x

 
Assorted Lease Companies' Web Pages:
 
- BrightGrid
 
- Solar City
 
- Solar Universe
 
- SunCap Financial
 
- Sungevity
 
- SunPower
 
- SunRun
 
- Vivint Solar
 
 

©2014 by Bill Fridl. All rights reserved.
Links to this site are welcome. Copying content from this site without written permission is illegal. Share your thoughts. Email me at billfridl@gmail.com