SunRun Solar is trying to sell me a lease for a 4.3 kW solar system. The lease costs $8,240 prepaid for 20 years of power (nearly 5,000 kWh produced per year, "guaranteed"). Or, I could pay $64 monthly with a 2.9% annual escalator. At the end of the term, I could buy the system at its "market value" (whatever that means); if I decide not to buy it, SunRun will remove it for free.
Here's what SunRun says the exact same system would cost to buy:
Gross cost: $27,000
NYSERDA incentives: -$6,480 (I live in New York; NYSERDA is the state agency that collects a few bucks in monthly fees from each electric utility customer and uses the money for these incentives)
Federal tax credit: -$4,956
State tax credit: -$5,000
Net cost: $10,564
So, let's say I didn't have $10,564 lying around. I could borrow it (as a home equity line or loan) at 5 to 6% for 20 years, and my monthly payment would be a few bucks more than the $64 monthly that SunRun wants for the lease - and unlike SunRun's lease payments, the loan payments wouldn't go up. And unlike SunRun's lease, I'd own the system free and clear in 20 years.
So what, exactly, would be the benefit of a lease? The only thing I can think of is that they will maintain the system, but how much maintenance, really, is the system going to need over 20 years?
(One other lease "advantage" is that they "guarantee" the system will produce as much electricity as they state, and if it doesn't they will pay me $0.13 per kWh that it didn't produce. Not terribly generous, given that the going rate is $0.18 and expected to increase.)
Here's what SunRun says the exact same system would cost to buy:
Gross cost: $27,000
NYSERDA incentives: -$6,480 (I live in New York; NYSERDA is the state agency that collects a few bucks in monthly fees from each electric utility customer and uses the money for these incentives)
Federal tax credit: -$4,956
State tax credit: -$5,000
Net cost: $10,564
So, let's say I didn't have $10,564 lying around. I could borrow it (as a home equity line or loan) at 5 to 6% for 20 years, and my monthly payment would be a few bucks more than the $64 monthly that SunRun wants for the lease - and unlike SunRun's lease payments, the loan payments wouldn't go up. And unlike SunRun's lease, I'd own the system free and clear in 20 years.
So what, exactly, would be the benefit of a lease? The only thing I can think of is that they will maintain the system, but how much maintenance, really, is the system going to need over 20 years?
(One other lease "advantage" is that they "guarantee" the system will produce as much electricity as they state, and if it doesn't they will pay me $0.13 per kWh that it didn't produce. Not terribly generous, given that the going rate is $0.18 and expected to increase.)
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