Rising energy costs are forcing many homeowners to look for alternative methods to power their homes and a growing number are turning to solar panels to provide an affordable source of energy. Advancements in the field of solar technology have led to solar panels becoming far more efficient, and they can now be purchased much more cheaply than when they were first rolled out to the public. However, the cost of installing a home solar system is still several thousands of dollars, and the initial cost can make them unattainable to the average homeowner.
Solar panel companies have come up with a solution in the form of a lease agreement that allows homeowners to rent the solar panels from the manufacturer and receive free electricity without having to pay any money upfront or take on the responsibility of maintaining the system. Renting a solar panel system does have some disadvantages, and this article looks at whether homeowners are better off renting or buying their solar panels.
Buying Vs. Renting
There are two ways to rent solar panels. One is to lease them outright and receive all of the electricity they produce for free, and the other is through a solar power purchase agreement (PPA) where you purchase the electricity the system produces at an agreed price. No matter which method you choose, you will not usually have to pay anything for the system and will receive free maintenance and tracking information to see how your system is performing.
The downside of renting is that you do not qualify for any government incentives whatsoever, and a few of them can be extremely lucrative. Owning solar panels qualifies you for a 30% federal tax credit as well as cash incentives worth up to $6000 per kilowatt. Energy generated from solar panels can even be sent back to the grid in return for renewable energy credits which can be used to offset the cost of purchasing power from the utility companies. Purchasing a solar panel system will also significantly increase the value of your home, but attempting to sell your home with rented panels may prove difficult if the new owner does not want to take on the lease.
What Is The Best Option For Me?
Renting solar panels is a fantastic option for those who do not have money to invest in buying their own system, but they will miss out on many of the long term benefits. Purchasing the panels yourself is always preferable to leasing them as the government incentives will more than offset the initial cost after a period of time. Those who would like to obtain a quote for a home solar system can contact the Renewable Energy Corporation who can put them in touch with a qualified solar installer.
There are finance options available for those who wish to purchase their solar panels, and many installation companies can offer their own private payment plans. Many banks also see solar panels as a worthwhile investment and are likely to approve a loan towards the cost of installing them as they know the homeowner will be able to recoup the cost through savings and incentives. Before installing your panels, make sure you obtain quotes from multiple companies to ensure you secure the best deal for your individual circumstances.
Ryan McNeill has a passion for renewable energy. He enjoys blogging about practical questions and concerns for the everyday person to understand their options.