Solar Financing in 2026: Cash, Loan, Lease, PPA

Cash

You pay the full price, you own the equipment, and you keep the bill offset. There is no escalator and no lender.

Cash is the cleanest comparison. Berkeley Lab found lower up-front prices for cash purchases than for loan-financed systems in the 2025 subset where financing type was clear, about $3.00 per watt versus about $4.50 per watt at the medians. Part of that gap is dealer fees rolled into financed prices. Cash avoids that fee. Cash also requires you to have the money.

You are responsible for inverter replacement years from now and for taking the array off if the roof is replaced. Those costs are real. They are also visible, which is an advantage over a contract that hides them.

The homeowner credit under section 25D is not available for an installation completed after December 31, 2025. Paying cash does not revive it. Do not let a cash-price conversation assume a 30 percent reduction unless a tax professional applies an earlier, actually allowed credit to your facts.

Loan

You still own the system. You repay principal, interest, and any fees. The monthly payment can be higher or lower than the bill offset. That comparison is the whole point, and it is often skipped.

A loan that costs $210 a month to offset $160 of electricity is not savings. It is a more expensive electric bill plus a lien or a personal loan. Ask for the cash price, the amount financed, the APR, the term, the dealer fee in dollars, and the monthly payment. Then put the payment next to a realistic bill offset, not the salesperson's highest chart.

Secured loans can put a lien on the house. Unsecured loans can carry a higher rate. Prepayment penalties matter if you sell. Read for all three. Dealer fees that were financed are interest-bearing too. That is another reason the Berkeley Lab loan prices ran higher before interest even starts.

We do not offer the loan and we do not shop it for you. An introduction to an installer is not a lending decision. If the only payment you are shown is a financed payment, ask for cash before you continue.

Lease

A company owns the panels on your roof. You pay to use them, often with a payment that rises every year.

You typically do not claim a homeowner energy credit, because you did not buy the system. The owner of the system is in a different tax position. Do not assume their tax position shows up as a discount you can audit. Your documents are the lease payment, the escalator, the production guarantee if any, the maintenance promise, and the end of the term.

Escalators of a few percent a year sound small and compound. A payment that starts below the current bill can cross above it later, especially if retail rates do not rise as the brochure assumed. Ask for the full schedule of payments, not year one.

Selling the house means the buyer assumes the lease, you buy it out, or the deal is renegotiated. Some buyers and some lenders dislike that. Read the transfer clause while you still have leverage, which is before you sign.

Power-purchase agreement

You agree to buy the system's electricity at a contracted price. You still do not own the equipment.

A PPA is usually priced in cents per kilowatt-hour, sometimes with an escalator. Compare that price with your retail rate and with a realistic export story. If the PPA price is only attractive because the chart assumes retail-rate exports the utility will not pay, the comparison is false.

Production risk sits partly with the contract. If the roof underperforms, a well-written PPA may charge you only for energy produced. You should still care, because a weak system wastes the roof for 20 years. Ask who maintains it and how fast they respond when monitoring shows a fault.

As with a lease, the end of the term and the house sale are the clauses people regret skipping. Buyout formulas that use 'fair market value' without a method are an argument waiting to happen.

How to choose among them

If you can pay cash without strain, cash is the simplest ownership. If you borrow, make the payment survive a plain bill comparison. If you do not want to own the system, read a lease or PPA as a 20-year relationship, not as 'free solar.'

Nothing in this list is free. A $0-down offer is a financing structure. Is solar worth it is the decision frame. Choosing an installer is how you compare the companies offering these contracts.

American Solar Savings does not require you to pick a financing product to use the calculator. The estimate is available either way. If you request a call, say which structures you are willing to hear about so the conversation stays narrower than a full menu.