Different solar financing options make sense for different homeowners. For many, a solar lease or Power Purchase Agreement (PPA) is a great option to help them see the benefits of going solar. At Alchemy Solar, we work with Sunrun, the nation's residential solar panel leader, to provide our leases or PPAs. Many solar customers are interested in a lease or PPA because it is possible to go solar without putting down any money, but this is just one reason why a solar lease can make sense for a homeowner.
Let's take a look at the seven features of a solar lease that make it such a good fit for many homeowners.
1. Day one savings
When a homeowner signs up for a solar lease, the home can expect to see savings as soon as the solar system is turned on. Unlike with ownership, the homeowner doesn't have to wait for the IRS to provide a tax credit because the Federal Solar Investment Tax Credit (ITC) savings are built into the monthly payment. Instead of waiting years to recoup the savings to cover the cost of purchasing a solar system, a solar lease allows for immediate savings.
The exciting thing is that the savings will only increase compared to the rates that utilities will charge. On average, utilities increase their prices by 3% every year (higher in some states like California). Simultaneously, a solar lease allows a homeowner to lock in a low and attractive rate for 25 years.
2. 25 years of peace of mind, maintenance, and service
One of the best features of a solar lease is that it comes with 25 years of service, coverage, and support. That means that the system is monitored for you, and if any issue is noticed, it will be addressed and fixed at no cost for you. The added benefit of knowing that for the next 25 years, you never have to worry or pay another cent to fix the solar system is almost impossible to put a value on!
When looking at a solar home battery, 25-year maintenance and workmanship can be a huge advantage. Most solar batteries have a 10-year warranty, but when included in a solar lease or PPA, it is still covered under the 25-year coverage.
3. No Additional Costs
When a homeowner purchases a solar energy system, they usually have to take on a few additional costs.
One that might seem minor at first but adds up is insuring the solar system. Adding a solar system to a home can cost over $20,000 and frequently increases the homeowner's insurance. Even if it is just $5 a month, over the next twenty-five years, that will be an additional cost of $1500 that the homeowner will have to pay.
When a homeowner chooses a solar lease or PPA because a third party owns the solar panel system, it is ensured by the system owner. That means, in most cases, the homeowner's insurance does not change.
4. Best of both worlds
Alchemy Solar was founded to make sure we provide the best solutions for every customer. That means that when we partnered with a Solar Lease provider, we partnered with the best! Sunrun is the nation's largest dedicated residential solar provider, with 18 years of solar experience, over 100,000 customers, and an A+ BBB Rating. That means you get the local expertise from Alchemy Solar and the stability economies of scale from SunRun to help provide the best savings possible!
5. Performance guarantee
A solar lease comes with 25 years of monitoring and warranties and a 25-year performance guarantee. That means that if your solar system goes down or your system underperforms, you will receive a check to cover the solar system's underproduction. As an added benefit of the solar lease agreement, if your solar energy system overproduces, the additional power is yours at no extra cost.
6. Home improvement that adds real value
Home improvement projects have different objectives, but few (if any) add real long term value to a home. While purchasing a solar panel system will lead to the most significant home value increase, leasing a solar energy system will increase its value.
Solar panels are designed to last for over 25 years, so rest assured that the solar panels will provide savings and value for decades to come, unlike your car or phone.
7. Ease of transfer
Not every home is a forever home. Even though solar makes a house a more attractive option for potential buyers, sometimes the system's financing can be an additional hurdle during the home sale process. Sunrun identified this as an issue and to ensure that solar is as attractive of an option as possible. It has a dedicated team of lawyers and real estate agents to help with the system transfer during a home sale. They are dedicated to making the process as easy as possible and guaranteeing that the new homeowner will qualify for a solar agreement.
A solar lease or PPA is not the right fit for every homeowner. Still, if you are looking to go solar with a limited upfront financial commitment, fix your electricity costs, and want to have the peace of mind of knowing that your system will be monitored, warrantied, and production is guaranteed for 25 years, a solar Power Purchase Agreement or lease might make sense for you.
If you are interested in learning more about if a solar lease is the best option for you, schedule a free consultation today with Alchemy Solar.