SoCal Lease Quote

[russ]

2.) I'd suggest one maybe different way to look at all this buying vs. leasing of solar equipment is to think of it as how best to reduce a residential electric bill, hopefully in the most cost effective way possible for the circumstances, and not solely about putting solar electricity on one's property (if at all).

Agreed 100% - Solar panels on the roof will never save the world - even by .000001% however one should reduce their costs in the most practical manner.

The big thing wrong with leasing is that the government leaves the money on the table (accelerated depreciation) for the money boys. If money is going to be shovelled off the back of the truck the total benefit should go to the buyer.

Use conservations 1st, 2nd and 3rd and then solar - bought or leased either one.

The early leases were really a bad deal but competition corrected that quickly.

[Cypress]

The big thing wrong with leasing is that the government leaves the money on the table (accelerated depreciation) for the money boys. If money is going to be shovelled off the back of the truck the total benefit should go to the buyer.

But do they really? I'm pretty sure the rebate is factored into the lease pricing. It more or less serves as the down payment. Lets just assume the purchase cost of this system proposed is 22,000 so after rebates we're looking at a cash price of 15400. Total of all 20 years of lease payments (100x240) = 24,000. As consumers should we really be expecting the lease payments to total the cost of the system minus the rebates over a 20 year span?

It was already mentioned that a regular, 20 year loan on $15,400 at 5% equals a $101 payment which is the exact same price as a 20 year lease payment. Seems like the indirect rebate benefits the buyer the same as it would if he/she were getting a long term loan. With the lease you get the warranty but with purchase you get to keep 20 year old equipment. That's pretty much a wash in my book leaving both scenarios pretty equal.

I think everyone agrees both of these are not ideal situations in either case (long term loan vs. lease) but to say or assume the buyer doesn't benefit from the rebate on a lease...that's false.

[russ]

I think everyone agrees both of these are not ideal situations in either case (long term loan vs. lease) but to say or assume the buyer doesn't benefit from the rebate on a lease...that's false.

Who is talking about a long term loan? That really makes no sense at all to get caught up in.

Read my comment carefully - you are talking about something else. That is unless the leasing companies that having been falling all over each other are in the business just to be "green"? Which they most certainly are not. They are in the business because it is short term easy money - no other reason.

If the legislation was well done, 100% of the tax benefit could have gone to the buyer - not to some money man.

[Severum88]

I got a great sunpower system installed by Sullivan and it is on a lease. They installed 24 x21 335w panels. It went live on Tuesday.

My combined bill will go from an avg of $365 with SDG&E, to $242 with sunpower and SDG&E. No escalation, no money upfront......no brainier!

Severum

[russ]

My combined bill will go from an avg of $365 with SDG&E, to $242 with sunpower and SDG&E. No escalation, no money upfront......no brainier!

Severum

Right - with an escalator clause for 20 years I suppose.

[silversaver]

I got a great sunpower system installed by Sullivan and it is on a lease. They installed 24 x21 335w panels. It went live on Tuesday.

My combined bill will go from an avg of $365 with SDG&E, to $242 with sunpower and SDG&E. No escalation, no money upfront......no brainier!

Severum

Yes, no brainier if no money out front. Take care of your problem now, worry about the rest later.

[russ]

Yes, no brainier if no money out front. Take care of your problem now, worry about the rest later.

Like when you go to sell the home.

[Severum88]

And this is why no one brings up leasing around here. Try reading my post first.

Severum

Right - with an escalator clause for 20 years I suppose.

[Ian S]

Right - with an escalator clause for 20 years I suppose.

O.P.:

My combined bill will go from an avg of $365 with SDG&E, to $242 with sunpower and SDG&E. No escalation, no money upfront......no brainier!

[Severum88]

I see no issue whatsoever when selling. You guys need to understand micro-economics a bit better and how it may apply differently depending on where you live. Factors such as your power rate, real estate values, etc.

Ease up and don't be soo judge mental on individual's decision if it doesn't work out for you. Again, this is the reason Cypress, myself, and others avoid posting much.

Cheers.

Severum

Like when you go to sell the home.

[Ian S]

Like when you go to sell the home.

In a market like San Diego where solar is becoming more common and homebuyers and real estate agents become more familiar with the leases, I think this will be far less of an issue. However, the seller should carefully document how much the solar system is actually saving them on utility expenses. Be able to prove it to a prospective buyer.

[russ]

Since the escalator clause point wasn't clarified you are making a bit of a WAG. If it is a good deal when selling the house (meaning power costs have climbed) then OK - if they haven't then what will be the attraction?

[Cypress]

Since the escalator clause point wasn't clarified you are making a bit of a WAG. If it is a good deal when selling the house (meaning power costs have climbed) then OK - if they haven't then what will be the attraction?

A WAG? Not sure what you mean here. He already stated twice now, including in his first post, that there is no escalators. Most solar companies have gone away from this or they at least give you the option. Starting lower payments w/ escalator, or slightly higher payment with no escalator. They have also addressed the issue of what to do if you sell your house. The new owner doesn't have to take over lease payments anymore...they give you options to buy the system outright. And not just buyout the lease. Buy the actual equipment, thus terminating the lease and the new owner keeps the equipment. All someone needs to do is factor that into your homes selling price...and in California...like someone already said...solar panels are a huge plus and add value for sure....

[Ian S]

Since the escalator clause point wasn't clarified you are making a bit of a WAG. If it is a good deal when selling the house (meaning power costs have climbed) then OK - if they haven't then what will be the attraction?

I don't understand your point. Severum88 stated that the lease has no escalator so the lease payment stays constant for the lease period. The lease payment + new utility bill is over $120 less than the existing electric bill. As long as it can be documented for the buyer, that's quite an attraction I'd say.

[Mr. Vegas]

Same here in the five boroughs of NYC (ConED country), Long Island where I live (PSEG taking over management for LIPA) along with NJ. Solar is becoming more commonplace, still a long way to go, but since all of these areas are so close to NYC, the attraction to live close makes buyers more flexible. A family member just sold their property in Bloomfield, NJ with a SunRun PPA 2.9% on the house, one of the worst contracts and the buyer took it without a second look because it's a 3 family house, newly constructed, which is rare in this area. If they didn't take it, the agent had 5 other buyers lined up. The buyers were more concerned with the COs and permits to add another kitchen for tenants than they were about the solar.

This is just one data point and I realize it is not indicative of other places. I have no worries ever about selling my house with a solar lease on it based on the area I live in the type of real estate market even with some of the negative effects caused by subprime fallout.