Solar Loan vs. PPA

roof curve Solar Loan vs. PPA

Solar energy is quickly becoming more affordable than ever forMassachusetts homeowners. Tax incentives and state rebates drive downthe initial cost, however the remaining balance of an array is still aconsiderable sum. Sunlight Solar Energy has partnered with severalgroups to reduce or even eliminate those upfront costs with a financialplan tailored to each homeowner.

Sunlight Solar has a wide variety of financing options. Our two newest are the SunRun Power Purchase Agreement and the SunPower 20 Year Loan. Here’s a comparison of how those deals work.

The SunRun Power Purchase Agreement (PPA) is anagreement through which SunRun will purchase the solar array designedand installed on your home by Sunlight Solar. You, the homeowner, thenpurchase the power from your solar panels from SunRun at a fixed rate.SunRun covers all maintenance, monitoring, and insurance of your systemduring the life of the 20 year agreement. After the 20 years is up, youhave the option to purchase the solar array at fair market value, orhave it removed at no cost to you.

SunRun offers two power purchase options:

  • A prepaid option in which you purchase 20 years worth of clean, solar energy at a rate lower than that of the utility company.
  • Or, a fixed monthly payment with a low upfront cost between $0 and $1,000.

Homeowners taking advantage of the SunRun PPA program can enjoy low,fixed energy costs for the term of the agreement but are unable to takeadvantage of tax incentives and rebates.

The second program currently being offered is a 20 Year Loan with our partner SunPower. This loan is an unsecured loan, meaning that it is not tied to your home equity. The 20 Year Loan offers a lowinterest rate and the option to re-amortize in the first 18 months. Asopposed to the PPA, those who utilize the loan option have fullownership of their solar array and are able to take advantage of all the tax incentives and rebates.

The bottom line:

  • With a PPA, you pay a set amount for power generated by the solarpanels with little to no money down. All maintenance and monitoring iscovered by SunRun.
  • With a loan, you own the panels and pay a monthly installmenttowards the loan. All eligible rebates and SRECS go directly to you, the homeowner.