How to Finance Solar in California: Cash, Loan, Lease, or PPA?

You don't need $30,000 in the bank to go solar. There are four main ways to finance a solar installation in California, each with different trade-offs. Here's an honest comparison.

1. Cash Purchase

• Upfront cost: $20,000–$35,000 (before tax credit)
• Pros: Highest lifetime savings, you own the system, qualify for ITC, no interest payments
• Cons: Large upfront investment
• Best for: Homeowners with available cash who want maximum ROI
• 25-year savings: $80,000–$120,000+

2. Solar Loan

• Upfront cost: $0 down
• Pros: You own the system, qualify for ITC, monthly loan payment is often less than your current electric bill
• Cons: Interest adds to total cost, approval required
• Best for: Homeowners who want to own their system with no money down
• Typical terms: 10–25 years, 4–8% APR
• 25-year savings: $50,000–$90,000

3. Solar Lease

• Upfront cost: $0
• Pros: No maintenance responsibility, predictable monthly payment
• Cons: You don't own the system, no ITC benefit, lower lifetime savings, can complicate home sales
• Best for: Homeowners who want simplicity with no upfront cost and are okay with smaller savings
• 25-year savings: $20,000–$40,000

4. Power Purchase Agreement (PPA)

• Upfront cost: $0
• Pros: Pay a lower per-kWh rate than your utility, no maintenance, no ownership hassle
• Cons: You don't own the system, no ITC, rate may escalate, can complicate home sales
• Best for: Homeowners who want immediate bill reduction with zero risk
• 25-year savings: $15,000–$35,000

Our Recommendation

For most California homeowners, a cash purchase or solar loan provides the best value. You own the system, qualify for the 30% tax credit, and keep all the savings. Leases and PPAs can make sense in certain situations, but they leave significant money on the table.

See your estimated savings or get a free quote with financing options.