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Ways to go solar

Own it. Finance it.
Or pay as you go.

Compare a cash purchase, solar loan, power purchase agreement (PPA) and lease with clear, adjustable examples.

Cash purchase

You pay for the system upfront and own the equipment. There is no solar loan interest or recurring lease payment. Your utility bill can still include fixed charges and electricity purchased from the grid. You generally retain eligible SRECs unless your contract assigns them elsewhere. Maintenance outside the installation and manufacturer warranties is your responsibility. Compare total installed cost, expected production, roof condition and long-term service support before deciding.

Solar loan

You own the system while repaying the lender over an agreed term. Monthly payments depend on the financed amount, interest rate, term and applicable fees. Compare the cash price with the financed price, and review APR as well as the stated interest rate. Ask whether the schedule includes a required principal payment, payment change or other special condition. Incentive eligibility is separate from financing approval, so do not assume a tax credit will fund a required payment. Before signing, review early payoff, security filings and what happens when you sell the home.

PPA

A power purchase agreement lets you buy solar electricity from a system owned by a third-party provider. A traditional PPA charges for actual production at a contracted price per kWh. Some providers use levelized billing based on modeled average production, so the monthly payment structure needs a careful review. An annual escalator can increase the price over time, even when the initial rate is attractive. The system owner generally receives the tax benefits, and the agreement determines who keeps SRECs and other incentives. Review maintenance coverage, performance terms, home-sale transfer, buyout and end-of-term options alongside the remaining utility bill.

Lease

A solar lease gives you use of equipment owned by a third-party provider in exchange for scheduled payments. The payment is generally based on the equipment agreement rather than each month’s actual kWh production. A lease may have fixed payments or an annual escalator that compounds over the term. The provider generally retains owner tax benefits, while certificate rights and service responsibilities depend on the agreement. Review roof-work procedures, insurance obligations, maintenance exclusions and any performance commitment. Before signing, compare transfer rules, buyout timing, end-of-term options and the utility charges that will remain.
All four options can still leave a utility bill, including fixed charges and electricity purchased from the grid. For leases and PPAs, review home-sale transfers, roof work, insurance, maintenance and buyout terms before signing.
Worked examples

The same home.
Four ways to pay.

Each example uses one sample Maryland home: an 8 kW system priced at $25,000 that produces about 10,000 kWh a year. If the home pays about $0.18 per kWh for grid electricity, that solar output replaces about $1,800 of electricity in year 1, or about $150 a month. Your own numbers depend on your roof, usage, utility rate and final quote.
Cash purchase

Pay in three milestones, own it outright

Upfront cost$25,000, paid in 3 milestone installments: at contract signing, at installation and at system activation
Monthly solar paymentNone
Year-1 electricity offsetabout $1,800 (about $150/month)
Simple paybackabout 14 years at today’s rate; sooner if utility prices rise
With MSAP (if income-qualified)up to $6,000 back ($750 × 8 kW), bringing net cost to about $19,000
Who keeps SRECs and grantsYou do
Good fit if: you have the savings available and want the lowest total cost and the highest long-term value.
Solar loan

Own it, pay over time

Amount financed$25,000 at 6.99% APR for 20 years
Monthly paymentabout $194
Year-1 electricity offsetabout $150/month, so about $44/month more than today at first
Total paid over 20 yearsabout $46,480, including about $21,480 of interest
After the loan endspayments stop; the system keeps producing for its remaining life
Who keeps SRECs and grantsYou do, as the owner
Good fit if: you want ownership and incentives without paying upfront, and expect utility prices to keep rising.
PPA

Pay only for the power it makes

Upfront cost$0
Price per kWh$0.15 in year 1, rising 1.99% a year
Year-1 paymentabout $125/month on average, versus about $150 of grid power replaced, so about $25/month saved
Year-20 priceabout $0.218/kWh, about $182/month
Total paid over 20 yearsabout $36,410
Who keeps SRECs and incentivesUsually the provider
Good fit if: you want savings from day one with no upfront cost and the provider handling maintenance.
Lease

A fixed monthly payment for the equipment

Upfront cost$0
Monthly payment$125 in year 1, rising 1.99% a year
Year-1 savingabout $25/month versus about $150 of grid power replaced, if the system produces as expected
Year-20 paymentabout $182/month
Total paid over 20 yearsabout $36,410
Who keeps SRECs and incentivesUsually the provider
Good fit if: you want a predictable payment and no upfront cost, and are comfortable not owning the system.
In these examples the PPA and lease cost about the same over 20 years, about $36,400, while the loan costs about $46,500 but ends with you owning the system and its SRECs. If utility prices rise about 3% a year, the same 10,000 kWh would cost about $48,400 from the grid over 20 years. Every option can still leave a monthly utility bill for fixed charges and grid power.
Sample figures only, not a quote or financing offer. Rates, approval and terms come from your actual proposal and lender or provider. The federal residential solar tax credit is not available for systems placed in service after December 31, 2025. Figures reviewed October 20, 2026.
Try the numbers

One system.
Four ways to pay.

Illustrative assumptions only—not a Solar Maxima quote, available financing offer or savings forecast. No incentives, tax credits, SREC income, utility-rate increases, production degradation, maintenance, loan fees or battery are included.
PPA production is held constant for comparison. The PPA monthly figure is an annual average; actual monthly invoices vary. Loan totals cover payments within the selected comparison period, with any remaining balance shown separately. Cash ownership value after the comparison period is not included.

How the 1.99% escalator works

Year 1 uses the starting price. Year 2 = starting price × 1.0199. Year 10 = starting price × 1.0199⁹. For example, a $125 monthly lease becomes about $127.49 in year 2 and $149.25 in year 10. The increase compounds; it is separate from utility rate changes.