By Neal on 05/24/2012 20:56 UTC
“Too Good To Be True” – An Honest Discussion Of Zero-Down Solar Leases
The title of this post is one of the most common refrains we hear from customers. Another is “Well, why isn’t everyone doing this then?”
The Evolution Of Solar Pricing
Solar has changed significantly in the last four years and continues to evolve at a rapid pace. One of the biggest changes has been the pricing. Back in 2008, seven dollars a watt and higher was the norm for pricing on solar electric systems. Now, prices have dropped down to around three dollars and fifty cents a watt.
Manufacturers have been able to cut their prices due to increasingly higher volumes of production. Installers have been able to reduce their prices due to a higher volume of customers.
Solar Game Changer
One of the most explosive changes in the solar industry has been the advent of solar leasing. It was an absolute game-changer in terms of making solar affordable to the average person.
Solar leasing itself has changed significantly in a relatively short amount of time. Initially, solar leases would leave homeowners upside down in terms of payments, that is, if your electric bill averaged $150 a month, you would have been looking at a lease payment at least ten percent higher or $165. The next change was a significant decrease in the pricing, but with attached annual escalation. With attached annual escalation, you paid less for the solar, saving 10 to 15 percent initially, but your payments would increase on a regular basis at a rate of three to four percent per year.
The next major change was a further reduction in pricing and the appearance of sensible, fixed payment solar leases, which would remain the same even if the cost of electricity skyrocketed. This fixed payment model has been incredibly successful. Although, many companies are still using the escalation-based leases to make their initial costs seem lower.
One of the main difficulties with using an escalator is that it is tough to predict just how high utility rates will increase in the future. It could very well be possible that the homeowner gets stuck with a lease payment that ends up exceeding their electric bill. It also certainly wouldn’t make the sale of a home any easier if you have to convince a buyer to take on 12+ years of ever-escalating lease payments.
Zero-Down Solar Lease Advantages
One of the biggest advantages of a zero-down, fixed monthly solar lease is being able to lock in an affordable energy budget for the future. With the pricing available today, a homeowner can save $500, $1000, even $2000 a year off their current electric bill, and as utility rates rise, your savings will only continue to go up.
A major advantage of leasing is that the solar panel system is fully insured and protected with a warranty for the entire 20 years. If there are problems with the solar system, it becomes the leasing company’s responsibility to make any necessary repairs.
Solar Power Production Guarantee
There’s also another modicum of security provided via the power production guarantee that promises a certain amount of production for every year of the lease, otherwise you will be compensated accordingly. If you sell your home, the lease is fully transferable and unlike most other solar leases, the SunPower lease, that Solar Topps offers, can be bought out at any time.
Solar Lease Benefits With SunPower
Another major advantage of this lease is that it is coming from the same company that is providing the solar panels – the most efficient panels on the planet.
Because SunPower is using their own solar panels, there is no middleman, and hence the pricing on this lease is tremendously improved over that of traditional solar leasing companies that have to go out and purchase panels from a manufacturer or wholesaler.
The SunPower lease is only available through approved SunPower dealers who have received extensive training and are subjected to a stringent quality control process to ensure that customers are not only receiving the highest quality in solar panels in the world, but also the most professional and durable solar installations possible.
While the leasing process can seem complicated, and people often question how the pricing can be so attractive, the simplest way to describe it is that the leasing company, in this case SunPower, takes all the available incentives along with depreciation, which is not available to residential customers, and then passes on a great deal of savings in the form of a fixed monthly payment. The homeowner then can derive the benefit of solar, not only without any upfront cost, but with an actual reduction in their annual expenditures on electricity over the long-term.
Huge Savings With A SunPower Zero-Down Solar Lease
In the end, the homeowner gets a chance to stabilize their electric bills, and for example, can turn $160 worth of electricity into a $90 lease payment, saving $600 plus per year – and substantially more down the road. In return SunPower has tax credits that can be utilized by its various financial partners and is able to increase its volume, thus dropping their cost per unit and setting themselves up to be more competitive in the future when today’s current solar incentives are long gone. Everyone is getting something out of the deal and while savings can vary, most people are pleasantly surprised at the considerable reduction they can see in their current utility bills. What could you do with an additional $500 to $2000 per year that you didn’t hand over to the utility company?
There are no gimmicks or hidden costs. Everything is spelled out in the detailed SunPower lease quotation. The only major requirements are being the owner of the residential property and being able to satisfy the minimal credit score threshold. Otherwise in a typical installation, all the costs are taken care of and the homeowner isn’t required to make any payments until after the system has been fully installed and commissioned.
Every household varies in their needs and utility demands, the only way to know for sure if solar is something that would make sense for your home is to get a free zero-down solar lease from Solar Topps today.
Solar Topps features a no-hassle philosophy; if you don’t like what we have to offer, you won’t be further disturbed … but you will at least have learned more about the process and overall pricing going forward.