According to the latest research by the SEIA, solar panel prices are at their lowest ever. You’ll still pay around $20,000 for your installation though.
Are you keen to enjoy the benefits of solar power but wondering how to afford solar panels? There are ways to avoid these high upfront costs.
Keep reading to find out more about what’s involved when you sign up for a solar power purchase agreement.
What Is a Solar Power Purchase Agreement?
A solar PPA allows you to enjoy the benefits of solar power without the exorbitant upfront costs. A developer installs and maintains a suitable solar power installation on your roof.
You sign an agreement with the developer whereby you have the option to own the solar panels after a certain number of years, provided you buy power from them during the contract.
Throughout the contract, the developer harvests all the solar power generated by your panels. In return, you get to use this electricity at a reduced monthly rate.
PPA vs Lease
A solar lease is similar to a PPA in that you don’t incur any upfront costs. You’ll also give all your solar power to the developer and own your panels after a specified number of years.
Instead of paying your electricity bill for the duration of the agreement, you pay a fixed monthly fee to use it as if it were your own.
Pros and Cons of a Solar Power Purchase Agreement
The major benefit of a solar PPA is that you can get on board with solar and start saving immediately. So, you can enjoy the benefits of maximizing your home’s solar potential without worrying about your budget.
You’ll also pay a lower monthly fee for your electricity at first.
According to Blue Raven Solar, you could save thousands with a PPA, but it isn’t the only way to cut costs on your solar installation. You could also benefit from various state and federal incentives depending on where you live and which solar PPA you choose.
On the downside, most solar PPA providers increase their charges every year. When you buy your panels outright, you’ll never pay an electricity bill again.
Solar installers who offer PPAs offer a wide range of opportunities to save, but it’s up to you to ensure you choose a package that you can afford long term.
If you decide to sell your home, things can get complicated. If the new owner’s willing to continue with the PPA arrangement, you’re free and clear.
If they aren’t, your PPA provider might agree to move your installation to your new home, if the original agreement allows for that.
Find Your Ideal Solution
Always read the terms of your solar power purchase agreement carefully so you’re aware of the costs and savings involved and ask questions if you’re unsure.
Despite the downfalls, a solar PPA is an excellent way to do your bit for the environment and try solar before you lay out a lot of cash.
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