Solar Financing Options in Texas

Compare loans, leases, and PPAs to find the best financing for your solar project

Cash Purchase

Best ROI

Solar Loan

Own the system

Solar Lease

$0 down

PPA

Pay per kWh

1. Cash Purchase

Advantages:

✓ Lowest total cost (no interest)
✓ Fastest payback period (6-9 years)
✓ Maximum 25-year savings ($40,000-$60,000)
✓ Qualify for all incentives and tax credits
✓ No monthly payments
✓ Increases home value immediately

Disadvantages:

• Requires $15,000-$30,000 upfront
• Ties up liquid capital
• May have better investment opportunities

Example Savings (25 years):

System Cost:$25,000

Federal Tax Credit (30%):-$7,500

Net Cost:$17,500

25-Year Savings:$45,000+

2. Solar Loan

Advantages:

✓ $0-$1,000 down payment
✓ You own the system and equipment
✓ Keep all tax credits and incentives
✓ Monthly payment often less than electric bill
✓ Increases home value
✓ Various term lengths (10-25 years)

Disadvantages:

• Interest increases total cost by 30-40%
• Longer payback period (12-16 years)
• Monthly loan obligation
• Credit check required

Typical Loan Terms:

• Interest Rates: 3.99% - 8.99% (depends on credit)
• Loan Term: 10, 15, 20, or 25 years
• Monthly Payment (20-year, $25k): $150-$190/month
• Total Cost: $30,000-$38,000 over loan life

3. Solar Lease

Advantages:

✓ $0 upfront cost
✓ No maintenance responsibility
✓ Predictable monthly payments
✓ No credit check (in most cases)

Disadvantages:

• You don't own the system
• Leasing company keeps all tax credits
• Complicates home sale (buyer must qualify)
• Lower long-term savings (50% less than ownership)
• Annual payment escalator (2-3% increases)

⚠️ Important Note:

Solar leases are becoming less common in Texas as loan options have improved. Most financial advisors recommend ownership (cash or loan) over leasing for better long-term value.

4. Power Purchase Agreement (PPA)

Advantages:

✓ $0 upfront cost
✓ Pay only for power produced
✓ Rate typically lower than utility
✓ No maintenance responsibility

Disadvantages:

• Don't own the system
• PPA company keeps all incentives
• Annual rate escalator (1.5-3%)
• Complicates home sale
• Lower savings than ownership
• Not available in Texas due to regulations

❌ Texas Restriction:

PPAs are generally not available in Texas for residential customers due to state regulations around retail electricity sales. Texas homeowners should focus on cash purchase or solar loans.

Comparison: Which Option Saves the Most?

Option	Upfront Cost	25-Yr Savings	Best For
Cash Purchase	$17,500	$45,000+	Maximum savings
Solar Loan	$0-$1,000	$30,000-$35,000	Own with $0 down
Solar Lease	$0	$15,000-$20,000	No credit/budget concerns
PPA	$0	N/A	Not available in TX

Our Recommendation for Texas Homeowners

Based on long-term value and available incentives:

1st Choice: Cash purchase (if affordable) - Maximum savings and fastest ROI
2nd Choice: Solar loan - Own the system with no money down, still get tax credits
3rd Choice: Solar lease - Only if ownership isn't feasible

Get Financing Quotes Browse TX Installers

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Solar Financing Options in Texas

Compare loans, leases, and PPAs to find the best financing for your solar project

Cash Purchase

Best ROI

Solar Loan

Own the system

Solar Lease

$0 down

PPA

Pay per kWh

1. Cash Purchase

Advantages:

✓ Lowest total cost (no interest)
✓ Fastest payback period (6-9 years)
✓ Maximum 25-year savings ($40,000-$60,000)
✓ Qualify for all incentives and tax credits
✓ No monthly payments
✓ Increases home value immediately

Disadvantages:

• Requires $15,000-$30,000 upfront
• Ties up liquid capital
• May have better investment opportunities

Example Savings (25 years):

System Cost:$25,000

Federal Tax Credit (30%):-$7,500

Net Cost:$17,500

25-Year Savings:$45,000+

2. Solar Loan

Advantages:

✓ $0-$1,000 down payment
✓ You own the system and equipment
✓ Keep all tax credits and incentives
✓ Monthly payment often less than electric bill
✓ Increases home value
✓ Various term lengths (10-25 years)

Disadvantages:

• Interest increases total cost by 30-40%
• Longer payback period (12-16 years)
• Monthly loan obligation
• Credit check required

Typical Loan Terms:

• Interest Rates: 3.99% - 8.99% (depends on credit)
• Loan Term: 10, 15, 20, or 25 years
• Monthly Payment (20-year, $25k): $150-$190/month
• Total Cost: $30,000-$38,000 over loan life

3. Solar Lease

Advantages:

✓ $0 upfront cost
✓ No maintenance responsibility
✓ Predictable monthly payments
✓ No credit check (in most cases)

Disadvantages:

• You don't own the system
• Leasing company keeps all tax credits
• Complicates home sale (buyer must qualify)
• Lower long-term savings (50% less than ownership)
• Annual payment escalator (2-3% increases)

⚠️ Important Note:

Solar leases are becoming less common in Texas as loan options have improved. Most financial advisors recommend ownership (cash or loan) over leasing for better long-term value.

4. Power Purchase Agreement (PPA)

Advantages:

✓ $0 upfront cost
✓ Pay only for power produced
✓ Rate typically lower than utility
✓ No maintenance responsibility

Disadvantages:

• Don't own the system
• PPA company keeps all incentives
• Annual rate escalator (1.5-3%)
• Complicates home sale
• Lower savings than ownership
• Not available in Texas due to regulations

❌ Texas Restriction:

PPAs are generally not available in Texas for residential customers due to state regulations around retail electricity sales. Texas homeowners should focus on cash purchase or solar loans.

Comparison: Which Option Saves the Most?

Option	Upfront Cost	25-Yr Savings	Best For
Cash Purchase	$17,500	$45,000+	Maximum savings
Solar Loan	$0-$1,000	$30,000-$35,000	Own with $0 down
Solar Lease	$0	$15,000-$20,000	No credit/budget concerns
PPA	$0	N/A	Not available in TX

Our Recommendation for Texas Homeowners

Based on long-term value and available incentives:

1st Choice: Cash purchase (if affordable) - Maximum savings and fastest ROI
2nd Choice: Solar loan - Own the system with no money down, still get tax credits
3rd Choice: Solar lease - Only if ownership isn't feasible

Get Financing Quotes Browse TX Installers