Our solar financing options fall in two broad categories: loans or leases. With a solar loan you own your system and pay off the loan over time. With a solar lease, a financing company owns your system and you pay them a monthly fee to use the energy it produces.
Bridge loans are a type of solar loan popular with customers who want to own their system but who need to manage the timing difference between installation and receipt of state and federal incentives. Since solar incentives in Illinois can account for more than 60% of the cost of a system, this type of loan allows customers to go solar with considerably less up-front investment.
The bridge loans chosen by our customers have zero interest as long as you pay off the balance within the term specified by the loan—usually 12 or 18 months. Our lenders usually call these “same-as-cash” loans.*
As an example, let say you decide to purchase your solar system. Assume the gross price is $28,000, but the net price after incentives is $13,000. You have $13,000 available but not $25,000. You could use a bridge loan for the $18,000 difference. When you receive your Illinois solar incentive you would pay down a portion of the bridge loan. When you receive the benefit of the federal tax credit (this may happen when get your income tax refund), you would pay off the rest of the loan.
A term loan is similar to mortgage. The term loans most frequently chosen by our customers have a 20-year term, but we also offer 15 and 10 year loans. This type of solar loan is great for customers who want to minimize the out-of-pocket cost of going solar but who still want to take advantage of the long-term economics of solar ownership.
The payments on these loans can be smaller than the savings on utility bills that result from going solar. Another advantage of a term loan is that the payments on it are fixed over the life of the loan, unlike the cost of utility electricity. You are also free to pay off your loan at any time with no penalty.
Once you pay off your loan, you are producing the power off of your solar system and essentially get free energy for the remaining life of your system.
Just as with an automobile lease, with a solar lease you don’t actually purchase your solar system—you make payments for the right to use it over a period of time. The solar leases we offer are provided by SunPower, our equipment manufacturer, and have terms of 20 years.
Solar leases are great for consumers who want to immediately save money on their energy costs but who prefer not to invest in their system. We only offer leases where the annual payments on the lease are less than what you would pay to your utility for the same amount of electricity the system will provide.
The payments on a lease are also entirely predictable. Unlike your utility bill, they do not vary from month to month. They are also locked in for the term of the lease, providing protection against inflating utility prices.
Solar leases are also ideal for customers who don’t have a federal income tax liability and thus can’t take advantage of the federal tax credit for solar. Solar lease customers do not receive the federal tax credit or the Illinois Shines incentive, but rather benefit from those incentives through a lower monthly lease payment than they would otherwise receive.
At the end of the lease term, you have an option to renew for another five or ten years or buy the system outright at a reduced cost. If you don’t renew, the leasing company will remove the system.