Leasing vs Buying
As always, cash is king. You will hands-down see the best payback period, Internal Rate of Return (IRR) and Return on Investment (ROI) on your solar project, when you purchase the system with cash. You receive all the same benefits of ownership as you do when you finance your solar power system, but without any interest rates, charges, or financing fees. If you have money sitting mutual funds, or other investments, you will want to evaluate the IRR you are receiving on those other investments - in most cases, solar is the better investment.
Regardless of how you finance solar, the bottom line is that you will save money. One thing is for certain - the cost of electricity in California is not going down any time in the near future. Despite which financing mechanism you decide to use when you go solar, you want to pay extra attention to the contractor that you select to install your solar panels. As with any home upgrade you make, not all contractors are alike. Go solar with a quality company that has a proven track record and reputation - choose a solar company that you know is going to be around and provide excellent service for the longhaul.
Access to credit or cash has a significant impact on your decision to go solar. If cash is available, we recommend you look at going solar as an investment much like any other part of your portfolio including real estate, stocks, bonds, etc. With 15% to above 20% returns, an investment in solar is a great balance against your other investments whose performance is heavily tied to the overall economy. Solar will provide excellent returns regardless of an economic recession or boon. Having said that, the following factors will influence which financing options makes the most sense for you.