Path-Q Solar

What should I compare between a solar lease and a cash purchase?

Answer

Compare total lifetime cash outlay, ownership, expected savings, maintenance responsibility, performance risk, flexibility on sale, and the value of keeping or investing the cash. A lease may reduce upfront cost and shift some responsibilities, while a cash purchase may provide greater control and avoid financing or lease payments.

Key points

  • For the lease, include every scheduled payment, escalator, fee, buyout, and transfer obligation.
  • For cash ownership, include installed cost, maintenance, insurance effects, replacement reserves, and opportunity cost of the cash.
  • Use the same system output, utility assumptions, ownership period, and treatment of exports for both options.

What it depends on

  • Lease contract and cash purchase price
  • Production, degradation, and utility-savings assumptions
  • Maintenance, warranty, and replacement responsibilities
  • Liquidity needs, investment alternatives, and expected time in the home

Risks and trade-offs

  • A lease can be easier on near-term cash flow but more restrictive at sale.
  • A cash purchase avoids contractual payments but concentrates equipment and capital risk with the homeowner.
  • Different proposals may not be comparable if system size, equipment, or production estimates differ.

Information you may need

  • Itemized cash proposal and full lease agreement
  • Production estimate, warranties, and service terms
  • Ownership horizon and available cash or alternative investment return

Your next step

What to do next

Normalize both offers into a year-by-year cash-flow table showing payments, savings, maintenance, residual obligations, and sale outcomes.

Path-Q

Find the right next step

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