You rent the panels. Fixed monthly bill no matter what they produce.
Risk: You pay even if performance tanks.
Headache: Leases are notorious deal-killers when selling your home.
Billing: Charged per kWh only for actual production.
Safety net: If the system stops producing, you don’t owe.
Catch: Escalator clause (often 2.9% annually) ratchets up your rate regardless of utility trends.
Billing: Estimated yearly production ÷ 12 = same bill each month.
Looks like a lease: You pay even if production underperforms.
Catch: Same 2.9% escalator, and same headaches transferring at sale.
Ownership: You own the equipment outright—no monthly payments beyond your normal utility “standby” charges.
Incentives: Eligible for the federal solar Investment Tax Credit (ITC)—but that expires January 1, 2026 for homeowners. After that, it’s gone for direct purchases.
Long-term math: Once ITC is gone, direct purchase costs will still “pencil out” as utility rates keep climbing—sometimes even faster without the lease/PPA escalators.
Warranties: Most solar panels carry 25-year manufacturer warranties; inverters usually 12–20 years.
Availability: Solar loans are everywhere, but read the fine print.
Dealer fees: Finance companies tack on large hidden dealer fees (sometimes 20–30%), which get rolled into your loan balance. Easy to hide in long amortizations.
Advice: Compare against local banks or credit unions, who may offer lower-fee loans. Ask directly: “What dealer fee is built into this loan?”
What it is: A lien filed by the finance company, showing they own the panels.
Impact:
Home sales grind to a halt until it’s cleared or transferred.
Refinancing often gets blocked.
Bankrupt solar company? The lien stays like a ghost until you fight to remove it.
✅ Bottom Line:
Lease: Rent panels, fixed bill, tough to exit.
True PPA: Pay only for production, escalator risk, no bill if system fails.
Leveled PPA: Flattened monthly bill, but you’re stuck paying even when output is low.
Direct Purchase (Cash): Best long-term control, ITC until 1/1/2026, strong warranties.
Loans: Attractive but risky—dealer fees can erase the savings.
John Ryan Executive Director
About Solar Escalations LLC: Solar Escalations LLC was started with two primary goals in mind. First - Help existing solar customers that are stuck with bad solar agreements, faulty installations, and unresponsive solar companies. Second - To advocate for stronger consumer protections in the solar industry through our Ambassador for Change program. Ambassador Program Details
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