Eight-year solar photovoltaic power generation loan

What are the different types of solar financing options?

A variety of solar financing options are available from solar providers and private lenders that are specific to solar energy systems, with the two main types being secured and unsecured loans. Secured loans use your home as borrowing collateral. These typically carry lower interest rates than unsecured loans.

What is the best type of solar panel financing?

For many people, the best type of solar panel financing is probably a personal loan for solar. A personal solar panel loan will come with fixed interest rates and fixed monthly payments that never change during the life of the loan. Some home improvement loans have higher limits or longer terms to make it easier to pay for more expensive options.

Should you get a solar loan?

Solar panel financing rates are higher for this type of loan, as the lender is assuming more risk. Getting a loan to finance your solar system makes you the owner of the system, meaning you’ll be eligible to save money via government tax credits and similar incentives. Interest rates are the main drawback to getting a solar loan.

What is third-party solar financing?

Third-party financing is a well-established financing solution in the United States, having emerged in the solar industry as one of the most popular methods of solar financing. Third-party solar financing predominantly occurs in two forms: solar leases and power purchase agreements (PPAs).

What is a solar PPA / lease?

Solar PPAs or leases are best for those with financial restrictions who still want to power their home with solar energy and reduce their carbon footprint. Some of the best solar installers offer their own financing, often through a third-party lender that they partner with.

Can a PPA be used to finance a solar installation?

The National Renewable Energy Laboratory (NREL) has drafted example contracts for a variety of PPA arrangements for use in creating or vetting new PPA programs. DOE has a draft RFP for use in requesting applications to create either a PPA or a lease for financing a solar installation. Select each financing option to dive deeper and learn more.