Third-party-owned solar has taken the residential market in the U.S. by storm. SunRun recently announced a growth of 80% in California in only one year. Another study revealed that more than 70% of Californians who go solar prefer third-party ownership. Similar numbers can be found in several other states as well.
Many companies have started offering “zero-down” payment schemes since SolarCity first introduced the ingenious financing model back in 2006. Homeowners no longer have to pay heavy upfront costs to reap the benefits of solar photovoltaic panels.
We`ll take a closer look at the five largest leasing companies in the solar industry (SolarCity, SunRun, Sungevity, SunPower and Real Goods Solar). What are their differences? The goal of this article is to help you figure out which solar provider is the best choice in your situation.
Let`s start with a quick overview over a few common terms:
Leasing a solar system is pretty much the same as leasing a car or a TV. You pay your solar provider a monthly fee (fixed, escalating or de-escalating) to lease their solar panels.
Many companies will allow homeowners to prepay the entire lease, or part of it (down payment).
Power Purchase Agreement (PPA)
Power purchase agreements are almost identical to solar leases – the only difference is that you pay for the amount of power the solar panels produce, as opposed to just leasing the equipment.
What is common for both solar leases and PPAs is that most companies will take care of everything from installation to monitoring and maintenance. The duration of a solar lease/PPA is typically 10-20 years.
Protection from rising electricity prices. Leases and PPAs provide protection against volatile electricity prices. Top tier electricity prices have increased about 5% on average every year for the last 30 years.
Sit back and relax. The five solar companies that we discuss in this article take care of everything from start-to-finish – including installation, monitoring, maintenance and repairs. You will be provided with a performance guarantee, insurance and warranty.
Save from day 1. Solar leases and PPAs are comparable to, or in most cases, cheaper than their original utility bill. Solar has really become a no-brainer for many homeowners.
The five solar providers offer different services:
|Duration of lease||20 years||20 years||10-20 years||10-20 years||20 years|
|Brand of solar panels||Sanyo
|Depends on installer||Depends on installer||SunPower||SunPower
None of the companies are operating in all states. SolarCity offers their services in 12 different states. SunRun and Sungevity have recently expanded to Australia and the Netherlands.
What are the differences between SolarCity, SunRun, Sungevity, SunPower and RGS?
SunRun and Sungevity are “financing only” companies. They have partnerships with local solar installers in the states where they operate in.
SunPower manufactures their own solar panels and also handel financing. Only authorized dealers can install SunPower solar panels.
SolarCity is the only company that takes care of both financing and installation. The company placed #10 on the World`s 50 Most Innovative Companies by Fast Company in 2012:
“The key: Rather than just make panels, it is a full-service operation–designing, installing, financing, and maintaining every system. That’s how to ease new customers into an unfamiliar technology.”
What’s the Catch?
Solar leases and PPAs almost seem too good to be true. The solar provider is the owner of the solar system if you choose a lease or PPA, and have the right to all incentives, rebates, refunds and cash credits (including SRECs).
The bottom line is this: It is true that a cash purchase would be cheaper in the long run, but most homeowners simply can`t afford the heavy upfront costs. SolarCity, SunRun, Sungevity, SunPower and Real Goods Solar are making solar possible for more homeowners, which not only is great for the environment, but can also help you bring in a lot of savings.
3 Solar Quotes has helped thousands of homeowners spend less by going solar. Find out which leasing company is best for you. It’s 100% free: