Solar Lease vs Buy Calculator
Compare the net cost of buying a solar system outright against leasing it, over your chosen lease term.
How this calculator works
Buying and leasing solar panels move money in very different shapes. A purchase is mostly one lump sum, reduced by any tax credit or incentive you qualify for. A lease is a steady monthly payment that adds up over the full length of your contract. This calculator lines the two up side by side so you can see which one costs less over the same time period.
Formula: Net cost to buy = system cost − tax credit/incentive. Total lease cost = monthly lease payment × 12 × lease term in years.
Worked example
A $20,000 system with a $6,000 incentive, compared against a $150/month lease over a 20-year term:
- Net cost to buy: 20,000 − 6,000 = $14,000
- Total lease cost: 150 × 12 × 20 = $36,000
- Buying saves $22,000 over the term.
Notes
This comparison looks at raw cost only. Buying also means you own the system outright, and it can add value to your home on top of the electricity savings. Leasing usually includes maintenance and a production guarantee bundled into the monthly payment, so the leasing company handles repairs and underperformance risk instead of you.
Incentives like the federal solar tax credit generally only apply if you buy the system. Leased systems are owned by the leasing company, so they typically claim those incentives instead of you.
How to use
Enter your system’s purchase price and any incentive you expect to qualify for, along with the monthly lease payment and term length you’re comparing it against. The calculator returns the net cost for each path so you can see the dollar gap over your chosen term.
A simplified cost comparison. It excludes financing interest, maintenance, panel degradation, and changing electricity rates — model your specific quotes for a full picture.
Frequently asked questions
Is it cheaper to buy or lease solar panels?
Buying is usually cheaper over the long run because a lease payment continues every month for the full term with no ownership at the end, while a purchase is a one-time net cost after incentives. This calculator compares the two by subtracting your incentive from the purchase price and multiplying your monthly lease payment across the full term.
Do I get the federal solar tax credit if I lease?
Generally no. The tax credit and most other solar incentives apply to whoever owns the system, and with a lease the leasing company retains ownership. That's a major reason buying often ends up cheaper even though it requires more money upfront.
What does a solar lease usually include that buying doesn't?
Leases commonly bundle in maintenance and a production guarantee, meaning the leasing company handles repairs and may compensate you if the system underperforms. When you buy, you're responsible for maintenance yourself, though you also keep any value the system adds to your home.
Does this calculator account for financing interest or electricity rate changes?
No, it only compares the net purchase cost against the total of your lease payments. If you're financing the purchase with a loan, or expect utility rates to rise or fall significantly, factor those separately since they can shift the comparison in either direction.
Estimates only. Verify quantities with your supplier before purchasing.