Investing in solar panels is a savvy financial move, as the return on investment (ROI) often rivals that of some traditional investment vehicles.
However, for many homeowners, a high-quality home PV system installation can cost anywhere from $15,000 to $35,000 or more. What’s the best way to cover that expense?
In terms of solar ROI, cash is king. Financing solar panels comes in next, offering an attractive payback period for a photovoltaic installation. As for leasing, the benefits are few.
If you don’t have cash available for purchasing a solar panel system, leasing might seem like a good way to make the switch to photovoltaic power. No upfront costs and no responsibilities, just lower monthly electric bills. What’s not to like?
Plenty. First, the finance company owns your home PV system, which means you don’t get to claim the lucrative tax credits and rebates for installing photovoltaic panels. It also means the only return on investment you’ll see is in your lower electricity bills.
In addition, leases come with terms of 15 years or more. If you decide to move before your lease is up and you can’t find a buyer willing or able to assume the lease agreement, you’ll have to buy out the remainder of your contract.
Unlike leasing, financing solar panels gives you lower monthly electric bills and allows you to own your home PV system. Best of all, many lenders don’t require any down payment.
A secured loan — such as a home equity, FHA or PACE loan — could be an option if you have a favorable debt-to-income ratio and sufficient home equity. If not, an unsecured loan program may be the way to go. Some professional photovoltaic contractors, including Intermountain Wind & Solar, offer affordable unsecured financing programs for home PV installations.
Since you’ll be the owner of your home solar panel system, you’ll be eligible for several federal, state and local financial incentives. Claim these, and you’ll realize your return on investment much more quickly. Most Intermountain West homeowners reach the payback point in 10 years or less by financing their photovoltaic systems and taking advantage of money-saving renewable energy incentives.
If you can swing a cash purchase, you’ll see more savings and a faster rate of return on investment.
You’ll avoid monthly loan interest charges, and every penny you save on electricity will go back toward your bottom line. Many Intermountain West homeowners achieve total solar ROI in five years or less.
For more information on home PV system payment options, or for expert advice on making a smart solar panel investment, consult with the professionals at Intermountain Wind & Solar. As the leading renewable energy provider for the Intermountain West, we are committed to helping homeowners make an affordable switch to photovoltaic power.
Intermountain Wind & Solar offers free, no-pressure consultations to homeowners throughout Utah, Colorado, Idaho, Nevada and Wyoming. Contact us today to learn more about the best way to invest in solar panels for your Intermountain West home.
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