I know you’ve seen multiple adds online or on your social media feed claiming to offer free solar panels for your home but is it really “free”. I’m here to tell you these offers are false and tell you what these companies mean by “free solar”.
When these companies offer you a $0 down & $0 out of pocket system, what they are really selling you is a solar lease. A solar lease is a financing option for residential solar panels where the homeowner leases panels from a solar company instead of paying for them. Some companies will also offer Power Purchase Agreements, or PPAs for short.
With a lease agreement the solar company offers to reduce your electricity bill by a small percentage. In exchange you rent the panels and equipment from them for the next 15 to 20 years for a monthly fee. Since you are locked in to this agreement, you will not be able to sell your home unless you pay off your lease or sell the lease agreement to the new owners. PPA’s are almost the same but you enter a contract with the solar company to pay a set price for the electricity the system will produce.
So what does this mean for you the home owner?
Well there is some truth to their statement because you won’t pay anything out of pocket in the beginning to get the process started but you will now have two electricity bills. The first one will be from your electrical provider for any services charges and additional kilowatts that the system will not offset, the other will be your solar bill.
Meanwhile, because you don’t own the system, it doesn’t add value to your home and you won’t qualify of any federal or local incentives like the *Federal ITC. If you purchase your system, it adds immediate value to your home and helps it sell faster.
*Federal ITC
If you choose to purchase your system, the Solar Investment Tax Credit or ITC, lets you deduct 30% of the total cost of your system from your federal income taxes. Example, if your system costs $25,000, you can receive a tax credit of $7,500 on your income taxes the following year.
Keep in mind that in January of 2020, the ITC will go down to 26%, then to 22% in 2021.
Hope this post helped answer some questions you might of had.
Solar Electrical & Retrofit Solutions Inc (S.E.R.S. Inc) • Arlington, TX www.serdallas.com • (682)222-7588