Lease, loan, or buy?

Last updated: September 16, 2026

Why the answer changed

For years the advice was simple: own it if you can. A homeowner buying a system claimed a 30% federal credit, and a lease or PPA handed that credit to the company on your roof instead. Ownership won on almost every honest comparison.

That credit — Section 25D — ended for homeowner purchases after December 31, 2025. The separate credit that businesses claim did not end at the same time. A leasing company or PPA provider still owns the equipment, still counts as the business, and can still claim its version for now.

The four ways to pay

Where I still land, most of the time

Ownership generally still wins on lifetime cost. A lease or PPA has to earn the provider a return, and that return comes out of your savings for twenty or twenty-five years. Even with the tax asymmetry, paying someone else's margin for two decades is a lot to overcome. Owners also keep the equipment outright once it's paid off, and every year after that is close to free power.

But "most of the time" is doing real work in that sentence now, and I'd rather say so than repeat a rule that was written for different tax law.

When third-party ownership deserves a serious look

• You have little or no federal tax liability. This was always true for retirees on modest fixed incomes and is unchanged.
• You don't have the capital and don't like the loan terms once the dealer fee is counted honestly.
• You want someone else responsible for maintenance and will genuinely pay for that convenience.

What to read before signing either one

• The escalator. Many leases and PPAs raise your payment every year, often around 3%. Over twenty years that compounds into a much larger number than the first-year figure suggests. A flat agreement is better than an escalating one at the same starting price.
• Transfer terms. If you sell the house, the buyer has to qualify and agree to assume the agreement. This does complicate sales. Ask exactly what happens if they won't.
• The buyout. Know what ending it early costs and when you're allowed to.
• Production guarantees. What happens if it makes less than promised, and who decides.

The one I'd avoid

A long escalating PPA sold on a first-year monthly payment, with no total cost written anywhere in the document. I've pulled people out of those — occasionally before signing and occasionally after, which is harder. If a salesperson can't or won't tell you the twenty-year total, that is the answer.

Whatever you choose, get it as a written total in dollars over the full term, then compare like with like. That one step catches most bad deals, and it costs nothing.