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Residential Solar Lease vs Purchase

A solar lease is the best way to offset rising electricity costs!
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Today we have seen a dramatic shift in how homeowners are going solar in California. In the past the only way to go solar was to make a large up-front capital investment. Typical system size is 5kW and in the past could range anywhere from $30,000-$50,000. Today, in California we are seeing more third party owned systems then the traditional purchase options. The reason this is happening is because companies like American Solar Direct who are offering a low up front cost fixed rate lease solution to going solar. With minimal upfront capital required you can get the same financial benefits as a purchase. With a lease option you also get the security of not having to invest any additional capital into the system down the road and the flexibility to move as you chose. Fixed rate energy is the future here in the USA. Below are some calculations of the opportunity of the the capital over a 20 year time span for a 3kW system. This is what is possible to do if you invest your money in the markets or other investment vehicles.

Return on the investment of $13,960 over 20 years.

  • At 4% the amount will grow to: $29,411.61
  • At 6% the amount will grow to: $42,237.37
  • At 8% the amount will grow to: $59,131.50

As the economy continues to recover the opportunity to leverage capital is getting better and better. Below you will find some stats and charts to validate this trend.

As we continue to approach grid parity across the country we will see this trend continue to grow. Most homeowners can go solar today for about what they are paying currently to their local utility. If you would like some additional info on solar leasing or would like a professional quote then get started with our solar quote creator . We will be in touch within 24 hours.

 

BrightSource Energy

BrightSource Energy is a progressive company building Utility scale renewable energy projects. Since its founding in 2004, BrightSource has signed a record number of solar PPAs – long term power purchase agreements. They have contracted to deliver approximately 2.6 GW of installed capacity, in 14 PPAs, to California’s biggest utilities, PG&E, which serves 15 million customers, and to Southern California Edison, which has been the only one of the three major California utilities to meet its (20%) 2010 renewable energy targets on time.

Brightsource has some amazing strategies to create electricity. Thousands of mirrors reflect sunlight onto a boiler filled with water that sits atop a tower. When the sunlight hits the boiler, the water inside is heated and creates high temperature steam. The steam is then piped to a conventional turbine which generates electricity. This fully integrated approach produces low-cost solar power, while providing similar reliability characteristics found in conventional power plants.

What does this mean for you???

If you live in California you will be buying power from your local utility that was produced in their renewable solar farm. As a matter of fact, they will be producing approximately 13% of all of California’s electricity in the near future. BrightSource Energy has control of approximately 110,000 acres suitable for solar development in California and the U.S. Southwest with the potential to produce approximately 11 GW (11,000 MW) of installed capacity. The total electricity consumption here in California is approximately 80GW.

SCE has already signed into PPA (power purchase agreement) which will allow it to reach the 33% renewable standard set forth by the state legislatures. This will ultimately equate to rate hikes across the board here in California. These large scale capital expenditures in the desert are much more costly then the traditional coal fired plant, thus Edison has to pay a premium for this power it is important and they pass that cost onto all of its residential customers in the form of rate increases.

One way or another you will be consuming solar electricity in your home here in California. Its just your decision if you want to buy it from Edison or off your own roof!

BrightSource has reported it will have an IPO in the short term future. Keep your eye out for this as it is an excellent investment opportunity.

Brightsource