Third-party-owned solar has taken the residential market in the U.S. by storm. SunRun recently announced a growth of 80% in California in only one year. Another study revealed that more than 70% of Californians who go solar prefer third-party ownership. Similar numbers can be found in several other states as well.
Many companies have started offering “zero-down” payment schemes since SolarCity first introduced the ingenious financing model back in 2006. Homeowners no longer have to pay heavy upfront costs to reap the benefits of solar photo voltaic panels.
We`ll take a closer look at the five largest leasing companies in the solar industry (SolarCity, Sun Run, Sungevity, Sun Power and Real Goods Solar). What are their differences? The goal of this article is to help you figure out which solar provider is the best choice in your situation.
Let`s start with a quick overview over a few common terms:
Leasing a solar system is pretty much the same as leasing a car or a TV. You pay your solar provider a monthly fee (fixed, escalating or de-escalating) to lease their solar panels.
Many companies will allow homeowners to prepay the entire lease, or part of it (down payment).
Power Purchase Agreement (PPA)
Power purchase agreements are almost identical to solar leases – the only difference is that you pay for the amount of power the solar panels produce, as opposed to just leasing the equipment.
What is common for both solar leases and PPAs is that most companies will take care of everything from installation to monitoring and maintenance. The duration of a solar lease/PPA is typically 10-20 years.