ARS Solar Ownership Options

Cash Purchase

Paying for your solar system outright is the most straightforward way to own a solar system, though the upfront cost can be a significant barrier. With a direct purchase, or “cash option”, you buy your solar system similarly to how you would purchase a car or a home.

With ARS, payments for your system are made in stages: a down payment upon signing the agreement, a second payment when the panels are ordered, and a final payment when the installation is complete and operational. In a “cash option” you will cover these payments yourself. With a “cash option”, you fully own the solar array, including all the electrical production, environmental benefits, and any incentives associated with the system.

Solar Loan Financing

As with any larger purchase today, finance options exist to pay for your Solar System.  These include:

1. Borrowing money from a traditional bank by way of a home-equity loan or even a personal loan
2. Work with ARS and take advantage of one of the Solar Lending options we currently offer.  

With an ARS Ownership Solution, you will own your solar array outright – all of the electrical production, all of the “green benefits”, and any/all applicable incentives including federal tax credit and renewable energy credits will be owned by you. Whichever option you decide ARS Ownership Solutions allow you to switch to clean energy quickly and easily.

Solar Lease Agreements

Under a lease agreement, you pay nothing for the electricity produced by the system, significantly reducing your energy bill. Instead, you make a fixed monthly payment to your solar leasing company for the use of the solar system, often with no upfront costs for installation or maintenance. The monthly cost of your solar system will be less than the cost of the electricity it generates. This terminology is generally referred to as the “avoided cost of power.” Although your monthly payment may increase over time, it will be at a much lower inflationary rate than historical utility price increases.
In essence, the system is free, and you’ll save money over time through reduced electricity bills creating your avoided cost of power, even after accounting for the monthly lease cost. In a solar lease agreement, the solar leasing company owns your system. This means the leasing company (financier) receives any associated tax benefits and incentives, allowing them to profit from the system installed on your home.

Most solar leasing agreements last for 25 years, though terms can vary between companies. At the end of your lease, the solar panels can be removed from your home, or you can choose to enter into a new agreement. Some leasing companies also offer a path to ownership, allowing you to purchase the system at market rate at specified times during the lease. Solar leases are transferrable when you sell your home. Your solar leasing company will simply enter a new agreement with the new homeowner.

Power Purchasing Agreements (PPA)

A Power Purchase Agreement (PPA) is very similar to a lease and can be considered a rental agreement with a solar company. The solar system will be installed and maintained by the solar company, which will own the system and benefit from all tax incentives. In a PPA, you pay the solar company for the electricity produced by the system, which costs less than the electricity you would have used from your utility, saving you money over time. Unlike a lease, there’s no monthly cost for the system itself; your monthly payment is based on your solar system’s annual production, spread out over monthly payments.

The cost of the electricity produced by the solar system is fixed and cheaper than your utility’s rates. The electricity purchased through your PPA will increase at a predetermined rate, usually 2-5% per year (generally referred to as the “escalator”), which is lower than the rate of increase of your utility. You’ll start saving money on your electricity bill immediately, and the amount you save will increase over time as electricity rates rise. Compared to a solar lease, a PPA generally results in similar savings. The main difference between the two is the terms of the agreement. Both types of agreements may or may not include a path to ownership, depending on the terms set by the solar company.