Welcome to a new episode of Woke Wednesdays in Real Estate! Today we’re going to talk about solar leases and how we can benefit from them depending on our financial needs and/or interests.
A solar lease is a contract where a solar company agrees to finance the installation of panels on your roof and charge you a monthly fee for the use of these panels for the lease term, which will be usually between 15-20 years.
The solar company owns the panels during the term and is typically responsible for maintenance.
Something we need to keep in mind about solar leases is that during the lease period, the panels are owned by a third party and not the homeowner.
Whilst lease payments are expressed in $ per month (rather than in cents per kWh in a PPA) they can be converted to cost per kWh.
As you currently pay for electricity per kWh and as you measure kWh first to determine the savings offered by installing solar panels it is sometimes useful to convert a monthly lease fee into a cost per kWh.
This will allow you to compare the returns and savings from a solar lease to the returns made from buying solar panels outright.
Solar leases or Solar loans?
In solar leases, you are renting the solar panels that are owned by the solar company during the lease period. On the other hand, when you buy the solar panels and become the owner, you’ll get a financial reward from it that will come with more responsibilities too, as there won’t be a third party in this scenario.
Good luck, and I hope you enjoy your new home for many years to come.
So that’s all for today, hope you found this article useful so far and don’t hesitate in reaching me out if you have any questions or need a consultation.
Stay hungry and stay positive!
Make it a great day,
Sean La Rue