In reality a solar electric system lease is really a power purchase agreement. You are agreeing to allow an investor to use your property to install a system to harness the solar energy you receive and in turn they agree to sell the energy to you at a profit, for 15 to 20 years, but for slightly less than your electric utility charges. Since you don’t own the system, the investor keeps the Federal solar tax credits and State rebates. Since the solar components are a lease company business expense, the system value may be depreciated which affords the lease holder an additional tax advantage. In the future, when Cap and Trade laws move forward, a solar electric system may earn RECs (renewable energy credits) that can be sold to entities to offset carbon production. With a solar lease you won’t earn any energy credits either, those will be paid to the lease holder as well.
Posted on: Fri, 19 Jul 2013 15:27:02 +0000
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