Have you considered installing solar panels for your business establishment but don’t have the budget for its long-term maintenance?

Well, there’s no need to worry anymore since you can enjoy the benefits of having a solar power system in your building or commercial establishment without worrying about the additional costs it entails.

However, this easy and quick solar marketplace entrance point may or may not suit your needs the best. So, to help you decide if it is, this article has outlined the basics of buying a house with a solar leasing agreement below and how it should work between both parties.

How Does Solar Panel Leasing Work?


Solar leasing offers a tremendous economic opportunity for business owners interested in switching from traditional power systems to solar power systems. The sustainable future of renewable energy is undeniable, which is why there’s no doubt many entrepreneurs have considered its installment.

In this case, under solar leasing arrangements, a solar installation and financing company will agree to install the system on a rooftop.

Usually, this agreement doesn’t require a down payment. So, the installation and financing company should make the necessary connections to provide electricity to the commercial property.

The business owner, in return, should also agree to pay the fees for the rights to optimize all the power the installed solar panels produce during a specific timeframe. Usually, the agreed timeframe will be between fifteen and twenty-five years.

As soon as the leasing duration comes to an end, the agreement also ends. From there, the business owner will be free from further financial liabilities.

Depending on the lease’s specifics, the fees involved can be paid yearly, monthly, or lump sums. However, the most common payment term consumers choose is monthly, which restores the traditional connection between the consumers and utility companies.

So, when selecting a Power Purchase Agreement, the person leasing the solar panels or the business owner should agree to pay for the price of each kilowatt-hour their operations consume. This means that their monthly bills will vary, depending on the amount of power they consume.

Benefits of Solar Panel Leasing

Benefits of Solar Panel Leasing

Now that you already know how a solar panel leasing agreement works, you should learn more about its benefits for businesses.

You won’t have maintenance and repair responsibilities.

In this case, solar panel leasing companies and their partner contractors will agree to take complete repair and maintenance responsibility for the leased panels.

So, for example, if your solar panels got shaken during an earthquake, need a costly inverter, are damaged by a storm, require cleaning, have defects, and operate at minimal efficiency, the contractor and leasing company will take care of it.

You can purchase your own solar power system when the leasing contract ends.

Aside from that, you will have the opportunity to purchase your own solar panel system at the fairest market value for your commercial property after the leasing agreement ends.

The fair value depends on the concept’s age and productivity level. So, the longer the system has been available in the market, the more the price depreciates.

It eliminates upfront costs.

Of course, while solar energy system costs have declined over time, purchasing a rooftop PV still requires you, the owner, to pay for its necessary expenses. On the other hand, no-down-payment PPA agreements or solar leasing agreements need zero initial investment.

Because of this, you can enjoy using these panels without paying for the installation and equipment. So, all you need to be conscious about are your yearly or monthly fees.

It provides a more effortless and quicker solar marketplace entrance.

In general, purchasing solar panels for commercial usage is a drawn-out and complex affair. After all, you need to analyze and compare product choices thoroughly. Then, you need to contact multiple companies and service providers.

Aside from this, you’ll need to obtain the necessary permits and settle financing arrangements after deciding, which can be too complicated and time-consuming.

On the other hand, solar panel leasing offers a more straightforward, less stressful process in obtaining the right products. After all, after signing the lease agreement, the installation process can immediately start.

If you decide to sell your commercial property, you can transfer the leasing agreement to your buyer.

The conditions and terms that allow you to engage in such an agreement will be stated in your contract. So, to qualify for the transfer, your buyer should have a satisfactory FICO score.

In other words, they must have already paid for the commercial property or have agreed to pay the extra fees to the solar panel leasing company.


Naturally, the solar leasing schemes would not be attractive and convincing if the monthly solar energy fees would only be higher than or equal to the grid-obtained power fees. However, the fees solar panel leasing entails a significantly lower range of per kWh costs.

As a result, consumers get to enjoy a significantly lower cost by ten or forty percent monthly, making solar leasing’s general concept an undeniable financial winner.

Therefore, as long as you, as a business owner, follow the standard guidelines introduced by the solar panel leasing company, everything will go as smoothly as it should.

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