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SRP^®

Solar system financing comparison chart

The cost of installing a solar electric system depends on whether you purchase the system outright or enter into a leasing agreement. This chart will help you examine your options in order to choose the financing method that best fits with your lifestyle.

Issue	Purchase	Lease
Federal tax credit	You are eligible for the tax credit benefits as the system owner.	The leasing company retains all of the tax credit benefits as the system owner.
State tax credit	You are eligible for the tax credit benefits as the system owner.	The leasing company retains all of the tax credit benefits as the system owner.
SRP incentive payment	You can receive the incentive payment yourself or you can assign it to your contractor to buy down the system cost. Not applicable to production-based incentives.	Most leasing companies require that the customer sign over the incentive payment to them. Not applicable to production-based incentives.
System ownership	You own the system.	The leasing company owns the system installed on your roof. At the end of the lease term you may have the option to renew your lease, purchase the system, or remove the system.
Selling your house or business	The system is considered an upgrade and may increase your selling price or improve marketability.	Under a lease, you must either buy-out the remaining balance of the lease or transfer the lease to the individual purchasing your home or business. Transferring the lease is contingent on the new buyer's credit score and their willingness to accept the transfer. Leasing companies may also require that you get their written consent before you sell your home or business.
Monthly payments	You will have monthly payments if you purchase your system using a mortgage loan or a conventional bank loan. If you use a mortgage loan, the interest paid may be deductible on your federal taxes.	You will have a monthly lease payment. Most solar leases contain yearly increases between 2-5 percent throughout the term of your lease. Over a long-term lease, these yearly increases can result in your initial lease payment doubling.
System operation and maintenance	You are responsible for system operation and maintenance. However, your contractor may offer this service in your contract as part of the purchase price.	Either the leasing company or you may be responsible for various operation and maintenance practices as outlined in the leasing contract.
Energy savings	Your savings will be reflected in your utility bills. However, if you finance your system, these savings will be offset by the cost of the loan payment until the loan is paid at which time you realize all of the energy savings.	Your savings will be reflected in your utility bills. However, the cost savings on your electric bill will be offset by your monthly lease payment, as well as any additional costs realized at the end of the lease term.