If you are considering a Photovoltaic System for your home, here are 7 Questions you ABSOLUTELY need to ask!
Solar Electricity is definitely a good thing, you're saving money, you're going green, and it's better for the environment. But there are some complexities. Below are some things you absolutely need to consider when buying a solar system or a home with a solar photovoltaic system that is already installed.
The Difference Between Leasing and Owning Your Solar PV System
Ownership: The homeowner pays outright for the solar photovoltaic (PV) system with cash or a loan. They are responsible for the maintenance and repairs of the system. You will receive a bill from the electric company, but the bill is dramatically lower because you are generating most, if not all, of your own electricity.
Leasing: The solar leasing company owns the PV system, and assumes the cost of maintenance and repairs. "It's essentially a utility company on top of your roof," and you are paying to use the hardware and the service.
A popular option offered when leasing PV is no money down (although this isn't the only option). This is a fantastic benefit for those who cannot pay upfront costs that range from $15,000 - $25,000 (after rebates and incentives). A typical lease lasts around 10-20 years depending on your contract. At the end of the lease, options may include, renewing, purchasing the system, or having it removed.
"Leasing" can also be associated with "Power Purchase Agreement" or PPA, "Solar Lease", or "power share agreements." Homeowners may have the following options to think about when leasing:
- Paying for the use of a solar PV system
- Paying a fixed rate for the electricity that's generated each month
- Paying for a rate for the electricity that may rise or vary on an annual basis
BE SURE TO READ THE DETAILS of the agreement, as they can vary widely depending on the solar company.
I'm buying a home with a solar PV system installed and owned. What should I know?
When you but a home with PV that is owned, that ownership is transferable. Make sure you ask the seller for proof of ownership documents and that the system if fully permitted.
You should also request a building permit package and a copy of the contract from the PV installer so that you do not inherit the costs of unpermitted systems or improper installation.
If you are a seller looking to install PV panels on your home, demand that the contractor get a permit. Your life and property are not worth the minor cost savings!
I'm buying a home with a solar PV system installed and leased. What should I know?
Make sure to ask for documentation from the leasing company with the exact terms of the lease. If you don't understand the terms you will want to call the leasing company directly with your questions. While an agent should be able to get information for you, they are not experts on these documents. Disclosure is critical, so you know exactly what you're getting into when you buy a home with leased PV. When it comes to leasing, you need to know what the contracts say.
