Like most other major purchases, you have several ways to go about paying for solar panels for your home. Whether you pay for them up front, finance them, lease them, or skip ownership and go for cheaper greener power with no up-front costs.

Have the cash? Buy it outright. You can get a Federal Tax Credit on 30% of what you spend, and other local rebates may be available, too.

You buy your entire system from a trusted solar installer and you own 100% of the energy your system generates from day one*. Currently solar panel installations run around $4000-5000 per kWh (kilowatt hour). You can find out your typical system needs by looking at your bills and adding up the amount of power you’ve used in the last 12 months, but a typical 3-bedroom home uses somewhere between 4 and 6 kWh per year — your mileage may vary depending on where you live, how many people are in your home, and how energy-efficient you are.

Don’t have the cash but you still want to own it? Finance it. Most solar companies offer $0 down loans with low interest rates and you can choose either a 10-year or a 20-year payment plan depending on your budget. The expected lifespan of a home solar system is 20 years, so if you can pay it off in 10 you’ll save a lot of money on interest payments while you’re saving energy costs.

Don’t care about owning it? Lease it. You can have solar panels professionally installed at your home with no money down and zero responsibility for the panels themselves by leasing them from your solar company. You’ll save money on your electricity just like you would if you owned them, but you’re not eligible for a solar tax credit from the Federal government.

Don’t have the cash, but just want to go green and pay less for your energy costs? Try a Purchase Power Agreement (PPA)! This is a relatively new option in the solar game, but it’s a really great way to go solar if having lower monthly bills is your biggest priority. The solar companies have pre-negotiated energy rates with each of the utilities. They put the solar on your roof, hook it up to your current utility (for times when you need more energy than your system generates), and you get a bill from the solar company that’s 10-25% lower than your current energy costs. They’re responsible for everything (just like if you lease it or finance it). The best part? If it so happens that the solar company you’ve purchased your panels from goes belly up, you now own your panels (they’re free to you!) and the power you generate, drastically lowering your electric bill at zero cost to you. Granted, there’s only a very small chance of this happening and you shouldn’t rely on it, but it is a possibility (we ask those guys EVERYTHING).


* Day one means the day after you get your inverter connected to your power system at home.

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Use government and utility incentives. Learn more about solar tax rebates.