The solar lease is the primary mechanism by which Arizona residential solar installs have increased exponentially.

When most people hear about a solar lease, they automatically think of a conventional monthly payment, such as a typical car lease. When it comes to solar leasing however, there are two separate and entirely different types of solar leases out there, a prepaid lease and a monthly lease. Both have their pros and cons and it comes down to the homeowner to decide which happens to be the appropriate choice for them.

The Zero Down Solar Lease

The zero down lease is a solar lease that confers energy savings benefits without any actual upfront investment. The homeowner is offered a solar system that they agree with, they sign on to a proposal, the system is designed, permitted and installed and afterwards the homeowner begins regular monthly payments.

These payments can be either fixed, flat payments or contain an escalator. With a fixed payment, your first and final payment will be exactly the same amount, with an escalator, your actual payment will increase a certain amount per year.

The industry for the most part has moved to a fixed payment model, which is far more favorable to the homeowner than one with annually increasing payments for the full term. This lease comes with warranty, solar system monitoring and system insurance as a standard benefit. The homeowner gets to save money on electricity without the responsibilities of ownership and gains security in knowing that the system is covered should something go wrong.

solar lease chart on solar topps

The Prepaid Solar Lease

The prepaid lease, otherwise known as a lease purchase, is an incredibly popular option with customers that would traditionally seek to purchase a system outright. Unlike the zero down lease, the prepaid consists of a single payment, made after installation, and then no other payments for the rest of the term.

The advantage of this option over purchase is a substantially lower out-of-pocket cost and the same added lease benefits that include warranty, insurance, monitoring and a power production guarantee for the length of the term. This system is especially beneficial for those with little to no tax-liability, who may be retired and want to control their future energy budget, but can’t utilize the tax credits of a traditional purchase.

While the pricing on a solar lease can be extremely favorable, a large portion of the cost is dependent on utility rebates. The higher the rebate, the better the solar lease numbers will be.

With today’s current incentives, the lease numbers are very appealing, but this could change as the incentives continue to decrease. To help decide which solar lease program is appropriate for your home, fill out our easy solar quote request form and you will be in contact with a Solar Topps sales professional shortly.

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