Solar Lease vs Buy Calculator — 25-Year Comparison 2026
Compare solar lease vs buying in 2026 over 25 years. See total costs, savings and which option puts more money in your pocket.
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Annual savings
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How to use this calculator
Enter the total purchase price of your solar system.
Enter the monthly lease payment and annual escalation rate from your lease quote.
Enter your current electricity rate and expected annual rate increases.
Adjust the federal tax credit percentage (30% in 2026).
See year-by-year cash flows and 25-year totals for both options.
Understanding your results
Solar purchase (cash or loan): You own the system, claim the full 30% federal tax credit, and keep all energy savings. After payback, electricity is essentially free. Adds value to your home.
Solar lease: The solar company owns the panels, installs them for free or at low cost, and charges you a monthly fee — typically lower than your current electricity bill. You don’t get the tax credit (the company does). After 20–25 years, you either buy the system at fair market value, have it removed, or negotiate a new contract.
The financial math: Most independent analyses show that purchasing solar (cash or loan) generates 2–3× more financial benefit over 25 years than leasing. The SEIA estimates that homeowners who buy solar save an average of $20,000–$40,000 over the system lifetime; lessees save $10,000–$15,000.
When leasing makes sense: If you cannot claim the federal tax credit (due to insufficient tax liability), if you cannot qualify for a solar loan, or if you plan to sell your home in 3–5 years, leasing can still make financial sense. However, leases complicate home sales — the new buyer must qualify to take over the lease or you must pay it off.
Frequently asked questions
For most homeowners, buying is significantly better financially than leasing. When you buy (cash or loan), you claim the 30% federal ITC directly, own an appreciating asset that adds home value, and keep 100% of the electricity savings. Over 25 years, buyers typically come out $10,000–$20,000 ahead of lessees. The main advantage of leasing is zero upfront cost — but $0-down solar loans now offer the same benefit while preserving ownership.
At the end of a typical 20–25 year solar lease, you usually have three options: renew the lease for another term (often at lower rates), buy the system at fair market value (typically $1,000–$5,000 for a system that's fully depreciated), or have the company remove the panels at no cost. Most financial advisors recommend the buyout option if the panels are still producing well — 25-year-old panels typically still generate 85–90% of original output.
Yes, but it complicates the sale. The new buyer must either (a) qualify for and assume the remaining lease payments, (b) you buy out the lease before closing (typically $5,000–$15,000), or (c) the solar company removes the panels. Many real estate agents report that solar leases can delay or complicate home sales, as not all buyers want to take on a lease obligation. Owned solar systems consistently increase home sale prices; leased systems have a more mixed impact.
Most solar leases include an annual escalation clause of 1–3% per year — meaning your monthly payment increases every year. Over 20 years, a 2.9% escalation rate nearly doubles your monthly payment. This is the key financial trap in solar leases: if electricity rates don't rise as fast as projected, you may end up paying more for leased solar than you would have paid for grid electricity. Always calculate the 20-year total payment, not just the initial monthly rate.