Solar Lease vs Buy Calculator
Enter the system size, the purchase price per watt and the lease payment with its yearly escalator, and compare the estimated 25-year net savings of buying vs leasing in your state.
Solar lease vs buy
D08Scenario A
Sets the electricity rate. Pick US average if you're not sure.
From EIA for US average. Use the rate on your bill if you know it.
Rate used: 18.4¢/kWh · US average · EIA reference 2025–26 · 1,350 kWh per kW of solar (data as of 2026-09-26) ·
Buying comes out ahead over 25 years by
Buy: $21.17 · lease: −$33,432.51 net over 25 years.
- Buy: net savings over 25 years
- $21.17
- Lease / PPA: net savings over 25 years
- −$33,432.51
- Difference in favor of buying
- $33,453.69
Estimate. Formula and sources are under “How it works”. Change any input; the result updates as you type.
2026 note: The federal 25C and 25D tax credits ended for installations after Dec 31, 2025. Our numbers use 2026 rules. State rebates, HEAR/HOMES programs and utility programs may still apply.
Formula
How it works
- Bill savings in year n (n = 0…24) = kW × your state's kWh per kW × (1 − 0.005 × n) × rate × 1.03ⁿ
- Buy = sum of 25 years of bill savings − kW × 1,000 × $ per watt − $15 per kW per year × 25 years (maintenance and insurance)
- Lease/PPA = sum over 25 years of (bill savings − monthly payment × 12 × (1 + escalator)ⁿ)
- Difference = buy − lease
No federal credit in the purchase price. The federal 25D credit ended for systems placed in service after Dec 31, 2025, so the buy line pays the full installed price. That also removes the old argument for leasing ("the leasing company takes the credit and passes it on"): the comparison is now just your price vs your payments. Both totals are 25-year estimates; the price, the payment and the escalator are editable.
Sources: typical lease escalator of 2.9%; maintenance and insurance of $15 per kW per year; 25-year horizon; production per kW from NREL PVWatts v8; 0.5%/year degradation (NREL); 3%/year rate escalation (EIA 2000–2025 history); electricity rate from EIA Electric Power Monthly table 5.6.A.
Worked example
A worked example
Buying the 6 kW system for $19,200 leaves an estimated $79,716.23 of net savings after 25 years of California bills, maintenance included. Leasing it at $160 a month, rising 2.9% a year, leaves $32,076.31. Over 25 years, buying comes out $47,639.93 ahead.
Reference
By state, at the default inputs
Buying comes out ahead over 25 years by, with this page's default inputs and each state's reference prices (EIA reference 2025–26, data as of 2026-09-26).
| US average | $33,453.69 | 18.4¢/kWh |
|---|---|---|
| Alabama | $33,453.69 | 15.5¢/kWh |
| Alaska | $33,453.69 | 25.0¢/kWh |
| Arizona | $33,453.69 | 15.0¢/kWh |
| Arkansas | $33,453.69 | 13.0¢/kWh |
| California | $33,453.69 | 32.0¢/kWh |
| Colorado | $33,453.69 | 16.0¢/kWh |
| Connecticut | $33,453.69 | 30.0¢/kWh |
| Delaware | $33,453.69 | 17.0¢/kWh |
| District of Columbia | $33,453.69 | 19.0¢/kWh |
| Florida | $33,453.69 | 15.0¢/kWh |
| Georgia | $33,453.69 | 14.5¢/kWh |
| Hawaii | $33,453.69 | 42.0¢/kWh |
| Idaho | $33,453.69 | 12.0¢/kWh |
| Illinois | $33,453.69 | 17.0¢/kWh |
| Indiana | $33,453.69 | 15.5¢/kWh |
| Iowa | $33,453.69 | 13.5¢/kWh |
| Kansas | $33,453.69 | 14.5¢/kWh |
| Kentucky | $33,453.69 | 13.0¢/kWh |
| Louisiana | $33,453.69 | 12.5¢/kWh |
| Maine | $33,453.69 | 26.0¢/kWh |
| Maryland | $33,453.69 | 19.0¢/kWh |
| Massachusetts | $33,453.69 | 29.0¢/kWh |
| Michigan | $33,453.69 | 19.5¢/kWh |
| Minnesota | $33,453.69 | 15.5¢/kWh |
| Mississippi | $33,453.69 | 13.5¢/kWh |
| Missouri | $33,453.69 | 13.0¢/kWh |
| Montana | $33,453.69 | 13.0¢/kWh |
| Nebraska | $33,453.69 | 12.0¢/kWh |
| Nevada | $33,453.69 | 15.0¢/kWh |
| New Hampshire | $33,453.69 | 27.0¢/kWh |
| New Jersey | $33,453.69 | 22.0¢/kWh |
| New Mexico | $33,453.69 | 15.0¢/kWh |
| New York | $33,453.69 | 25.0¢/kWh |
| North Carolina | $33,453.69 | 14.5¢/kWh |
| North Dakota | $33,453.69 | 11.5¢/kWh |
| Ohio | $33,453.69 | 16.5¢/kWh |
| Oklahoma | $33,453.69 | 13.0¢/kWh |
| Oregon | $33,453.69 | 14.5¢/kWh |
| Pennsylvania | $33,453.69 | 18.5¢/kWh |
| Rhode Island | $33,453.69 | 29.0¢/kWh |
| South Carolina | $33,453.69 | 15.0¢/kWh |
| South Dakota | $33,453.69 | 13.0¢/kWh |
| Tennessee | $33,453.69 | 13.5¢/kWh |
| Texas | $33,453.69 | 15.5¢/kWh |
| Utah | $33,453.69 | 12.0¢/kWh |
| Vermont | $33,453.69 | 22.0¢/kWh |
| Virginia | $33,453.69 | 15.5¢/kWh |
| Washington | $33,453.69 | 12.0¢/kWh |
| West Virginia | $33,453.69 | 15.5¢/kWh |
| Wisconsin | $33,453.69 | 17.5¢/kWh |
| Wyoming | $33,453.69 | 12.5¢/kWh |
Questions
FAQ
Is a solar lease a bad idea?
It costs more over 25 years in every one of our test cases: buying comes out $33,453.69 ahead in Texas (8 kW, $140 a month, 2.9% escalator), $47,639.93 in California and $16,425.00 in Florida with a flat payment. A lease needs no upfront cash, which is what you're paying for.
How much does the escalator matter?
A lot. In Texas, with the same $140 payment, dropping the escalator from 2.9% to 0 shrinks the gap in favor of buying from $33,453.69 to $15,000.00 over 25 years.
What happens to a lease when I sell the house?
The buyer usually has to take over the lease, or you pay it off. The terms are in your contract; read the transfer clause before you sign.
PPA vs lease?
With a lease you pay a fixed monthly amount; with a PPA you pay per kWh the panels produce. This calculator treats both as a monthly payment; enter your expected average PPA bill.
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