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We serve MA, NH, CT, RI, ME, VT, NJ, PA, and TX
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The ITC changed everything. With the federal tax credit gone for homeowner purchases, the lease vs. buy math has shifted. Here's an honest comparison.
Before 2025, buying solar was almost always better — you kept the 30% federal tax credit (Section 25D). That credit is now gone for homeowner purchases. But lease/PPA companies still claim 30% under Section 48/48E, and they pass those savings to you through lower monthly rates. The gap between buying and leasing has narrowed significantly.
The Short Answer
In 2026, leasing solar is now more competitive with buying because homeowner purchases no longer receive the 30% federal tax credit (Section 25D expired December 2025). Lease and PPA companies still claim the 30% ITC under Section 48/48E and pass savings to you through lower payments. Buy if your state has strong incentives (NJ, RI, CT, NY) and you plan to stay 10+ years. Lease if your state has no incentives or you want immediate savings with $0 down.
| Factor | Cash / Loan Purchase | Lease / PPA |
|---|---|---|
| Federal Tax Credit | $0 (Section 25D expired) | 30% (claimed by installer under 48/48E) |
| Upfront Cost | $20,000–$30,000 | $0 down |
| Monthly Payment | $0 (you own it) | $80–$150/mo typical |
| System Ownership | You own it outright | Installer owns it |
| Maintenance | Your responsibility | Included in lease |
| 25-Year Total Savings | Highest (after payback period) | Moderate (savings start day 1) |
| Home Value Impact | Increases ~4% | Minimal (lease transfers) |
| Best When | Strong state incentives, staying 10+ years | No state incentives, want immediate savings |
Buy
$0 (Section 25D expired)
Lease/PPA
30% (claimed by installer under 48/48E)
Buy
$20,000–$30,000
Lease/PPA
$0 down
Buy
$0 (you own it)
Lease/PPA
$80–$150/mo typical
Buy
You own it outright
Lease/PPA
Installer owns it
Buy
Your responsibility
Lease/PPA
Included in lease
Buy
Highest (after payback period)
Lease/PPA
Moderate (savings start day 1)
Buy
Increases ~4%
Lease/PPA
Minimal (lease transfers)
Buy
Strong state incentives, staying 10+ years
Lease/PPA
No state incentives, want immediate savings
Here's the real math for an 8kW system in Massachusetts ($0.28/kWh utility rate). These numbers show why the "best" option depends on your situation.
| Factor | Cash Purchase | Solar Loan (w/ dealer fee) | Solar Lease | PPA |
|---|---|---|---|---|
| Upfront Cost | $26,160 | $0 down | $0 down | $0 down |
| State Incentives | -$10,000 | -$10,000 * | N/A (system owner claims) | N/A (system owner claims) |
| Dealer Fee (hidden) | $0 | +$6,540 (25%) | N/A | N/A |
| Monthly Payment | $0/mo | ~$165/mo (20yr @ 1.49%) | ~$115/mo | ~$0.18/kWh |
| Total Paid Over 25 Years | $16,160 | $39,600 | $34,500 | $43,650 |
| Utility Cost Without Solar | $117,000+ (at 3% annual increases) | |||
| Net 25-Year Savings | $101,000 | $77,400 | $82,500 | $73,350 |
Upfront
$16,160 net
Monthly
$0/mo
Total Paid
$16,160
25-Year Savings
$101,000
Upfront
$0 down
Monthly
~$165/mo
Total Paid
$39,600
25-Year Savings
$77,400
Upfront
$0 down
Monthly
~$115/mo
Total Paid
$34,500
25-Year Savings
$82,500
Upfront
$0 down
Monthly
~$0.18/kWh
Total Paid
$43,650
25-Year Savings
$73,350
* Loan example assumes 20-year term at 1.49% APR with 25% dealer fee. State incentive reduces loan principal but dealer fee is calculated on pre-incentive amount. Utility rates assume 3% annual increase from $0.28/kWh. PPA rate assumes $0.18/kWh with 2.9% annual escalator.
There is no one-size-fits-all answer. Here's how three families in different states made their decision — and why each choice was right for their situation.
Montclair, New Jersey
"Used savings from a home refinance to buy outright. NJ's $0.90/W SREC incentive made the upfront cost manageable."
Highest long-term savings. Best for homeowners who plan to stay and have capital.
Plano, Texas
"With no state incentive and $0 federal credit for purchases, a lease at $115/month gave them instant savings without the large upfront commitment."
Immediate savings with zero risk. Best when state incentives are unavailable.
Stamford, Connecticut
"Chose a PPA at $0.18/kWh instead of buying because they plan to move in 6 years. They save roughly $0.12/kWh from day one with no payback period risk."
Pay only for what you produce. Best for homeowners who may relocate.
Lease/PPA payments are estimates based on typical market rates. Actual terms vary by provider. All purchase calculations assume $0 federal tax credit (Section 25D expired) and 3% annual rate increases.
In states with strong state incentives, buying solar still produces the highest long-term returns. Here's what state incentives look like on a typical 8kW system:
Rhode Island
$5,000
$0.65/W incentive
Massachusetts
$1,000
$0.15/W incentive
New Jersey
$0
$0.00/W incentive
Connecticut
$0
$0.00/W incentive
New York
$0
$0.00/W incentive
Pennsylvania
$0
$0.00/W incentive
Vermont
$0
$0.00/W incentive
Thinking of financing your purchase with a solar loan? Watch out for dealer fees — the hidden markup that can add 15–25% to your system cost without you even realizing it.
When a solar installer offers you a "low-interest" or "0% APR" loan, the interest cost doesn't disappear — it gets bundled into the loan amount as a "dealer fee." This fee, typically 15–25% of the system price, is added to your loan balance before your first payment.
Ask for the cash price separately
Get the total price if you paid cash, then compare to the financed amount. If the financed amount is higher, the difference is the dealer fee.
Compare "0% APR" to market-rate loans
A 0% APR loan with a 25% dealer fee often costs more than a 5–7% APR loan with no dealer fee. Run the total cost of each over the full term.
Use a home equity loan or HELOC
Home equity loans at 6–8% with no dealer fee can be cheaper than solar-specific loans. Plus, the interest may be tax-deductible.
Negotiate directly
Tell the installer you want to finance through your own lender and ask for the cash price. This removes the dealer fee entirely.
When comparing buying vs. leasing, many homeowners look at the "monthly payment" of a solar loan and compare it to a lease. But if that loan includes a 20–25% dealer fee, the total cost of ownership is inflated well beyond the actual system value. In some cases, a solar loan with dealer fees makes buying more expensive than leasing over the life of the agreement. Always compare total cost (principal + interest + fees) against total lease payments, not just the monthly amount.
Now that the federal credit is gone for purchases, lease/PPA has a stronger case — especially in states without state incentives.
New Hampshire
$0
No state incentive
Maine
$0
No state incentive
Texas
$0
No state incentive
Georgia
$0
No state incentive
What happens to solar when you sell your home is one of the biggest differences between owning and leasing — and it can significantly affect your sale.
If you buy and sell before full payback, your return comes from a combination of the electricity savings you earned plus the added home value. In most high-rate states, a purchased system begins returning value within 3–5 years when you include the home value premium.
If you lease and plan to sell, you save money every month from day one with no payback risk. When you sell, the lease transfers to the buyer (most leasing companies make this straightforward). You leave the home having saved money every month without any upfront investment.
Yes (NJ, RI, CT, NY, PA, MA, VT)
Buying likely wins. State incentives offset the lost federal credit.
No (NH, ME, TX, GA)
Lease/PPA has a strong case. You get the 30% ITC benefit indirectly.
Yes
Buying maximizes your 25-year savings and adds home value.
No
Lease/PPA gives you savings from day 1 with $0 down.
10+ years
Buying wins. You'll be past payback and saving thousands per year.
Under 10 years
Lease/PPA avoids the payback risk. Savings are immediate.
Based on state incentives, utility rates, and payback periods for a typical 8kW system, here is our recommendation for each state we serve.
| State | Utility Rate | State Incentive | Purchase Payback | Recommendation | Reasoning |
|---|---|---|---|---|---|
| Rhode Island | $0.27/kWh | $5,000 | 7 yrs | Buy | Strong state incentive ($5,000) + 7-year payback make ownership the clear winner for long-term residents. |
| New Jersey | $0.18/kWh | $0 | 11 yrs | Either | No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings. |
| Connecticut | $0.30/kWh | $0 | 8 yrs | Either | No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings. |
| New York | $0.24/kWh | $0 | 10 yrs | Either | No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings. |
| Pennsylvania | $0.17/kWh | $0 | 12 yrs | Either | No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings. |
| Massachusetts | $0.28/kWh | $1,000 | 8 yrs | Either | Moderate state incentive helps purchases, but a lease is competitive. Choose based on how long you plan to stay. |
| Vermont | $0.21/kWh | $0 | 11 yrs | Either | No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings. |
| New Hampshire | $0.22/kWh | $0 | 11 yrs | Either | No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings. |
| Maine | $0.20/kWh | $0 | 12 yrs | Either | No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings. |
| Texas | $0.14/kWh | $0 | 12 yrs | Lease/PPA | No state incentive and lower utility rates mean a long payback period for purchases. A lease provides immediate savings with the financing company’s 30% ITC benefit. |
| Georgia | $0.14/kWh | $0 | 13 yrs | Lease/PPA | No state incentive and lower utility rates mean a long payback period for purchases. A lease provides immediate savings with the financing company’s 30% ITC benefit. |
Rate
$0.27
Incentive
$5,000
Payback
7 yrs
Strong state incentive ($5,000) + 7-year payback make ownership the clear winner for long-term residents.
Rate
$0.18
Incentive
$0
Payback
11 yrs
No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings.
Rate
$0.30
Incentive
$0
Payback
8 yrs
No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings.
Rate
$0.24
Incentive
$0
Payback
10 yrs
No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings.
Rate
$0.17
Incentive
$0
Payback
12 yrs
No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings.
Rate
$0.28
Incentive
$1,000
Payback
8 yrs
Moderate state incentive helps purchases, but a lease is competitive. Choose based on how long you plan to stay.
Rate
$0.21
Incentive
$0
Payback
11 yrs
No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings.
Rate
$0.22
Incentive
$0
Payback
11 yrs
No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings.
Rate
$0.20
Incentive
$0
Payback
12 yrs
No state incentive, but high utility rates mean decent payback for purchases. A lease also works well for immediate savings.
Rate
$0.14
Incentive
$0
Payback
12 yrs
No state incentive and lower utility rates mean a long payback period for purchases. A lease provides immediate savings with the financing company’s 30% ITC benefit.
Rate
$0.14
Incentive
$0
Payback
13 yrs
No state incentive and lower utility rates mean a long payback period for purchases. A lease provides immediate savings with the financing company’s 30% ITC benefit.
Recommendations assume a 10+ year stay, good roof orientation, and average electricity consumption. Individual circumstances may shift the recommendation. Get a personalized analysis with our free quote.
We'll provide a detailed comparison of purchase vs. lease/PPA pricing for your specific home, roof, and energy usage. No commitment.