Compare 25-year financial outcomes of solar ownership vs. third-party leasing.
1. General Info
2. Buying Scenario
3. Lease Scenario
4. System Performance
Total Buy Cost
$0
Total Lease Cost
$0
No Solar Cost
$0
Solar Lease vs. Buy: Which is Right for You?
Deciding between purchasing solar panels and leasing them (via a Power Purchase Agreement or Lease) is the most significant financial decision in your solar journey. This calculator projects the total cost of ownership over 25 years, factoring in the Federal Investment Tax Credit (ITC) and annual price escalations.
Buying Your Solar System
When you purchase solar panels, you own the asset. The primary benefits include:
Federal Tax Credit: You can claim 30% of the system cost as a tax credit (ITC).
Increased Property Value: Owned solar systems typically increase home resale value more than leased systems.
Maximum Savings: Once the system is paid off (usually 6-9 years), your electricity is virtually free.
Leasing Your Solar System
Solar leases or PPAs allow you to go solar with $0 upfront cost. However, there are trade-offs:
No Tax Credit: The leasing company receives the 30% tax credit, not you.
Annual Escalators: Most leases include an "escalator clause" where payments increase by 1% to 3% every year.
Selling Your Home: A lease must be transferred to the new buyer, which can sometimes complicate real estate transactions.
Comparison Example
If a $20,000 system saves you $150/month in utility costs, buying it upfront with the 30% tax credit means your net cost is $14,000. Your "break-even" point occurs in year 8. If you lease that same system with a starting payment of $80/month and a 2.9% escalator, you save money from day one, but by year 20, your lease payment might exceed your initial utility savings.
function calculateSolar() {
// Get Inputs
var monthlyBill = parseFloat(document.getElementById('monthlyBill').value) || 0;
var utilityInflation = (parseFloat(document.getElementById('utilityInflation').value) || 0) / 100;
var purchasePrice = parseFloat(document.getElementById('purchasePrice').value) || 0;
var taxCreditPct = (parseFloat(document.getElementById('taxCredit').value) || 0) / 100;
var monthlyLease = parseFloat(document.getElementById('monthlyLeasePayment').value || document.getElementById('leasePayment').value) || 0;
var leaseEscalator = (parseFloat(document.getElementById('leaseEscalator').value) || 0) / 100;
var offset = (parseFloat(document.getElementById('offset').value) || 0) / 100;
var lifespan = parseInt(document.getElementById('lifespan').value) || 25;
// 1. Calculate No Solar (Utility) Cost
var totalUtilityCost = 0;
var currentMonthlyUtility = monthlyBill;
for (var i = 0; i < lifespan; i++) {
totalUtilityCost += (currentMonthlyUtility * 12);
currentMonthlyUtility *= (1 + utilityInflation);
}
// 2. Calculate Buy Scenario
// Net cost after tax credit
var initialCost = purchasePrice * (1 – taxCreditPct);
var totalBuyCost = initialCost;
var currentMonthlyUtilityAfterSolar = monthlyBill * (1 – offset);
var utilityInflationTracker = monthlyBill * (1 – offset);
for (var j = 0; j < lifespan; j++) {
// Add remaining utility bill (the portion not offset)
totalBuyCost += (utilityInflationTracker * 12);
// Add minor maintenance (approx $150/year average)
totalBuyCost += 150;
utilityInflationTracker *= (1 + utilityInflation);
}
// 3. Calculate Lease Scenario
var totalLeaseCost = 0;
var currentLeasePayment = monthlyLease;
var leaseUtilityTracker = monthlyBill * (1 – offset);
for (var k = 0; k < lifespan; k++) {
// Lease payments
totalLeaseCost += (currentLeasePayment * 12);
// Remaining utility bill
totalLeaseCost += (leaseUtilityTracker * 12);
currentLeasePayment *= (1 + leaseEscalator);
leaseUtilityTracker *= (1 + utilityInflation);
}
// Display Results
document.getElementById('resultsArea').style.display = 'block';
document.getElementById('totalBuy').innerHTML = '$' + Math.round(totalBuyCost).toLocaleString();
document.getElementById('totalLease').innerHTML = '$' + Math.round(totalLeaseCost).toLocaleString();
document.getElementById('totalUtility').innerHTML = '$' + Math.round(totalUtilityCost).toLocaleString();
var verdictText = "";
var buySavings = totalUtilityCost – totalBuyCost;
var leaseSavings = totalUtilityCost – totalLeaseCost;
if (totalBuyCost < totalLeaseCost) {
var diff = totalLeaseCost – totalBuyCost;
verdictText = "Buying is your best financial option! You save approximately $" + Math.round(diff).toLocaleString() + " more than leasing over " + lifespan + " years.";
} else {
var diff = totalBuyCost – totalLeaseCost;
verdictText = "Leasing is mathematically cheaper in this scenario by $" + Math.round(diff).toLocaleString() + ". However, remember that you do not own the equipment.";
}
document.getElementById('verdictText').innerHTML = verdictText;
// Scroll to results
document.getElementById('resultsArea').scrollIntoView({ behavior: 'smooth', block: 'nearest' });
}