So you’ve decided to make the switch to solar energy. Great move! However, you’re still wondering how best to finance this. Solar lease and solar financing are two of the most common ways with which you can shift to the new system. Both enable you to install solar panels without having to pay the enormous cost of the system upfront. Let’s understand what each of these is.
When you take a solar lease, it means you make a monthly payment to the solar installer rather than owning the solar panels yourself. This reduces the amount of money that you have to pay overall. You benefit from this arrangement by consuming solar energy for your household or business needs and subsequently, reducing your electricity bills because solar energy is efficient and less of it is required to power your home or office than normal electricity.
In solar financing, you take a loan to buy and install the solar panels. You can pay this off over the tenure. With the cost of solar panels steadily declining with time, many are opting for this option as the main benefit is that you gain ownership of the solar panels whereas, in solar leasing, you don’t.
Solar leases vs solar financing
Both solar loans and solar leases allow you to pay a lesser amount of money upfront when installing the solar panels. However, you will need to consider the terms of both scenarios in order to determine which is better for you. Some perks, such as tax exemptions by the government, may not be available to you if you choose the solar leasing option. On the other hand, if the interest rates for solar financing are too high, it may not be ideal for you. However, in the long run, solar financing may be a less costly option rather than paying a continual sum every month like in the case of solar leasing. As well, keep in mind that maintenance becomes less of a responsibility for you when you choose to lease. No matter which option you choose, your utility bills will dip from switching to solar energy, so that is a cost-saving benefit either way.
On the flip side, the return on investment from solar panels is higher when you go for solar financing rather than leasing. When making your final decision, you must weigh the pros and cons of each option and choose the one that matches your needs best. If you value ownership, you may want to consider solar financing. If you prefer to pay a lower sum every month for the entire duration of having the solar panels installed and like the convenience of maintenance and servicing taken care of, you may want to select solar leasing.
VEMCO is a well-established solar services company that provides end-to-end project management services to its clients. VEMC is ISO 9001:2015 certified and a pioneer in the field of electromechanical engineering products, allied equipment, and services. For inquiries, contact us at +919819907445.