Commercial Solar: Leasing Vs. Ownership - Which Offers the Best ROI?

Commercial solar projects offer unique challenges, ranging from large non-profit organizations to municipal buildings. The type of customer and project site will impact the sales, financing, and installation process in many ways.

As a result, working closely with key stakeholders in the beginning phases of the design process is crucial to avoiding costly change orders and potential project delays. In the case of a large commercial PV system, the client may also be the building owner or an organization occupying the space, in which case it is necessary to coordinate with them throughout the design and installation process.

Commercial PV Design

Commercial solar systems can be installed on new construction, retrofitted to existing homes or businesses, or relocated to a new property when the home is sold. However, the latter option requires an extensive site evaluation, and could require a permit application, a letter of support from the local utility or landmarks commission, and/or approval from the homeowner’s association or condo board. Additionally, a roof inspection would be required to ensure the rooftop can accommodate the system.

As such, it’s imperative to work with a trusted designer that can prepare all the necessary documentation in advance of installation, ensuring that permitting is as seamless as possible. A skilled design service will also be able to provide system specifications and engineering diagrams in order to complete the application for the required permits and incentives.

A reputable design service should also be able to provide detailed system performance projections for the long term, helping homeowners understand their true ROI when compared to the cost of electricity from their utility. A well-designed PV system can deliver impressive financial benefits, even in regions with a limited number of sunshine hours.

The Bottom Line

While purchasing a PV system offers better ROI than leasing, it’s important to consider all of the costs involved. Leasing is a great option for homeowners who prioritize immediate savings, want to avoid upfront costs, or have difficulty obtaining a loan. However, it is important to keep in mind that leased systems are owned by the leasing company, and that the monthly payments might include a contract escalator. In the long run, this can significantly diminish your return on investment.

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