free solar panels

Free solar panels: are they really free?

If you’ve been shopping around for a solar panel system, you’ve probably heard at least one company advertise ‘free solar panels’ – that they will install a solar energy system on your roof for free. But, much as with anything, remember that there is no such thing as a free lunch (or a free solar panel).

Key takeaways

  • ‘Free solar panels’ aren’t really free: typically this refers to solar leases or PPAs.
  • You’ll save more money overall by choosing a $0-down solar loan over a solar lease or PPA because you’ll be the one to receive any federal, state, or local incentives.  
  • If you’re able to purchase your system outright, you’ll see highest return on investment overall.  
  • While you can’t get free solar panels, you can get free solar quotes – visit the EnergySage Marketplace to compare custom quotes from local installers.

What’s in this article?

What do companies mean when they say free solar panels?

Decoding the sales pitch: The terms ‘free solar panels’ or ‘no cost solar program’ are sometimes used to advertise solar lease or solar power purchase agreements (PPAs). Under both types of arrangements, a company will put solar panels on your roof for no money up-front but will charge you for the electricity that they produce. Most offers will save you money but not all of them, so make sure you’ve thoroughly compared all your options. Also consider buying the solar panels or financing them with a zero-down solar loan.

So what do a company’s marketers and salespeople mean when they say ‘free solar panels’ or ‘no cost solar program’? Usually, they are referring to solar leases and power purchase agreements (PPA’s). Under these solar financing arrangements, a solar company will put a solar system on your roof at no up-front cost to you for installation, enrollment, or maintenance. This sounds great – you get to say that your home is powered by clean energy, and can even point to the solar panels on your roof to prove it.

But the reality is that you do not technically own the system, and the solar energy the panels produce is not part of a “no cost” solar program. Under solar lease agreements, ownership is retained by the solar company, and you pay for the electricity it produces. In essence, the company has built a small power plant on your roof and is selling you the electricity.

Will free solar panels save you money?

You may have various reasons for going solar. If you’re like most people, saving money, eliminating your utility bills and/or reducing your carbon footprint are probably at the top of the list. The environmental benefits of going solar are more or less the same regardless of who installs your system, so it’s key to focus on the financial benefits.

Regardless of its ‘do-good’ image, the solar industry is an industry like any other: the companies offering products are looking to turn a profit. Providers of solar leases make their money by selling you electricity, usually at a lower rate than what you pay your utility.

Although companies like SolarCity once dominated the market for solar leases, countless new players have since entered the space and begun competing with each other, while SolarCity is no longer around. Some solar leases will save you more money than others. You as a solar shopper can now take your pick of company based on their offer. So even if financial gain is secondary to environmental considerations for you, you should still shop around to make sure you’re getting the best deal.

Looking for free solar panels? Try financing your system with a solar loan instead

The revolutionary thing about solar leases was that they made it possible for virtually anyone with a roof to go solar, regardless of whether they had cash in the bank to purchase a system. Solar leases were crucial in removing barriers to entry back when solar system prices were prohibitively high.

But times have changed substantially since solar leases were introduced. Solar systems are now more affordable than ever, now that financing options other than solar leases have become viable. The most important of these is the solar loan, which combines the ‘zero-down’ aspect of the solar lease with the benefits of system ownership (‘the best of both worlds‘).

The falling cost of solar

Solar cost H2 2021

So before you sign up for the first ‘free solar panel’ or ‘no cost solar program’ deal that comes your way, make sure you understand what you’re being offered and that you’ve considered all of your other options. In other words, be a smart solar shopper.

Hidden costs of free solar panels by payment plan: how do loans and leases compare to an outright purchase?

Now that you understand the nuances between solar leases, power purchase agreements, and solar loans, it’s important to assess the return on investment in each scenario. Here’s a break down of the most potential to least potential return depending on the payment plan you choose (cash purchase, personal loan, or solar leases and PPAs): 

1. Cash purchase

Buying your solar panel system outright is usually the best value over 25 years. Even though your initial cost will be steep, you can reap all of the financial benefits and savings associated with going solar (incentives, tax credits, and more). 

2. Personal loan

applying for a solar loan is the next best option when it comes to a return on investment. The initial cost is $0; however, interest payments chip away at energy savings for approximately the first 7 years (or however long the loan takes to repay) until the loan is paid off. After that time period, you get to keep 100% of your energy savings. 

3. Solar leases and PPAs

choosing to go with a solar lease or PPA may be something worth considering for certain homeowners. The biggest selling point here is that there is no upfront cost, but beware that the value is dampened by the solar company who takes out their cut of your savings each month. By the end of your warranty period, the lease or PPA will have taken up more than half of your potential savings as profits for the solar installer. 

Take a deeper dive into the different solar financing options in this article. 

Federal and local solar incentives that lower the upfront cost of solar

The main takeaway when considering a ‘no cost’ solar program or PPA is that you don’t own the solar panel system on your roof—the installer does. Most agreements are structured in a way that heavily benefits the installer, and it allows them to claim the Federal Investment Tax Credit (ITC), as well as any local incentives, for going solar.

Solar tax credit

If you’ve been on the fence about switching to solar energy, there may be a financial incentive offered by the government that seals the deal for you. Right now, the best solar incentive is the ITC, which is available to all U.S. homeowners. As of 2022, this federal incentive allows you to claim the credit when you buy a solar energy system – you can currently credit up to 26% of your spending on the purchase and related installation costs. This tax credit value is applicable if the system is placed and in service before December 31, 2022. 

However, if you choose a ‘no cost’ solar program or PPA, your installer will get this credit instead of you. For example, if you the system on your roof costs $10,000, the ITC would award $2,600 to the system owner – however, because the installer would technically own the system, they’d receive that money. Essentially, you’d be missing out on one of the key financial benefits of investing in renewable energy. 

Performance based incentives

Two other programs worth mentioning include Solar Renewable Energy Credits (SRECs) and performance based incentives. First, some states that have ambitious renewable energy goals are striving to meet quotas related to solar production which has led to SRECs. Eligible houses with solar systems that can produce more than one megawatt-hour (MWh) of electricity can claim SRECs. Additionally, performance based incentives are rewards given for producing a certain amount of solar energy. For example, if you’re eligible for performance based incentives, your utility would pay you for producing a set quantity of electricity from your solar system, whether you choose to use it or you send it back to the grid. 

State & local incentives

The other perk here is that you can apply the 26% discount costs of your solar system after also taking any state-level rebates or incentives, meaning you can benefit from both federal and state incentives to help offset the costs of going solar. On a state level, most have an incentive program in the form of a tax credit, but it varies state-to-state. Many local cities and counties also offer direct rebates to help with the costs of solar panel systems and installation.

Commonly asked questions about ‘no cost solar’

Whether you’re considering opting into a no-cost solar program, or you’re second-guessing the sales pitch, check out a few frequently asked questions people have regarding this trend in renewable energy: 

How do you get free solar panels from the government?

Simply put, you cannot get free solar panels from the government. These payment plans are actually solar leases or power purchase agreements (PPAs), and they’re a no-cost upfront option that gives ownership to the solar company or installer. You pay for the electricity the system produces, and you miss out on many of the financial benefits and incentives of renewable energy. That’s not to say that PPAs or solar leases are bad – you can still save money in the long run! If you’re interested in learning about ways that the federal and local government can offset the cost of installing solar panels, we recommend learning more about the Renewable Energy Tax Credit and exploring state and local programs you might be eligible for. 

Who is eligible for free solar panels? 

Because ‘free solar panels’ is a misleading statement, it’s important to say this—no one is eligible for ‘free solar panels.’ However, solar leases have made it much easier for anyone with a roof to go solar, regardless of whether or not they can afford the upfront cost of installation. 

Are no cost solar programs really no cost?

No, there is no such thing as a no-cost solar program. These programs are actually solar leases or power purchase agreements (PPAs) in which a company will install solar panels on your roof for no money up-front, but they will charge you for the electricity produced.  

What’s the catch with free solar panels?

There is really no such thing as truly free solar panels. While verified installers may offer the panels themselves for no cost, you as the buyer will still need to pay for installation.

How can I get solar panels for zero money down?

While you cannot get panels for free, there are payment plans which are actually solar leases or power purchase agreements (PPAs), and they’re a no-cost upfront option that gives ownership to the solar company or installer.

Compare solar quotes on the EnergySage Marketplace

Solar panels may not be free, but you can get free, custom quotes from pre-vetted solar installers when you sign up on the EnergySage Marketplace. Comparing quotes allows you to see more options and ultimately get a great deal on your solar system. To get a quick estimate of how much you’ll save with solar – whether you choose to pay upfront, use a $0-down loan, or go with a solar lease/PPA – check out our solar calculator.

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98 thoughts on “Free solar panels: are they really free?

  1. Anonymous

    I just finished putting in an 8.6kW SunPower system that cost me $18k. This system is fully warrantied for 25 years, including labor and a promise that my system will still produce 92% of what it did in year 1. For long termers, def give SunPower a look.

      1. Shawn

        Right…….. you don’t seem to understand how grid tie solar and electricity works. The size of the solar system has nothing to do with your demand.


    I heard if you get the “free panels” which is really a long term lease and if you try to sell your home, the buyer would have to pay for the solar system outright. I went to an open house for a Condo and the catch was there was $35K that must be paid for the solar system on top of the property price! I was floored!

    1. Maria

      My neighbor bought her house and had to take over the solar panels loan as well. I’m thinking about getting them but so confused. I’m in California.y dad just got them 3 months ago and he does see the savings. He pays $155 a month for the next 25 yrs. Yikes!!!

  3. Dennis

    If you buy instead of lease you would be responsible for servicing or replacing broken or worn out solar panels. If you lease the panels I assume the company would maintain/replace them as needed. Is this correct?

    1. Gabby

      Nope, most companies offer warranties that cover all maintenance. I went with Elevation solar! Great company, I went from paying 200 to only paying 100.00 a month locked in rate and now I own my power, it’s pretty awesome!
      Ask for phil he’s the best!

  4. Russell Crawford

    Is that why they run a credit check? I’ve got good credit 720 And was turned down I’ve only needed 3-4 credit cards for various reasons. This was a group from Atlantic City electric the company was sunuity solar and sunova. They didn’t care who I could get with more credit history. Is this normal practice? Just to get me into a 20-25 year leases?

  5. Lionel

    Solar panels are definitely not a worth investment for everyone.
    I have solar panel installed on my house some 10 years ago. AS of today, I am not really sure if I have saved any real money.
    My 2.5Kw system cost $22k (after additional roofing work to remove clay tiles and install black roofing rolls).
    Note that the company pushed to get me to sign for a 4 to 5 Kw system. But I was interested on attempts to go 100% solar.
    I am paying $100/mo. on the lease ($1200/year) plus an average of $800 on a single bill form SCE in January every year.
    Prior to going solar my 3 year average was $250/mo. And now, I am paying $2000/year ($166/mo). It looks like I am saving about $84 each month.
    But, in this 10 years, my only two teenagers have moved out of town to college, the wife and I work far from the house from 7am to 6pm, we have replaced all old CRT tv’s and computer monitors for more efficient flat screens, upgraded my refrigerator with inverter model and many incandescent lights are now LED. SO, I don’t know from where that $84 dollars savings are really coming from.
    Even if I was saving $84/mo (wish I am clearly not) it would take 275 monthly payments (about 23 years) to barely break even on the $22k system whish by the way is on a 25 year lease that also has interest and its getting degraded and less efficient with time. Bottom line, I might NEVER see any benefit.

  6. Chris

    how is it too good to be true? it’s simple: they let you use their solar panels while you buy the electricity at a cheaper rate than you’re paying now. why would so many of your neighbors go to the trouble of doing this if they were all getting screwed? if you don’t do this you must either hate saving money or hate the planet.

  7. Steve

    I have been researching these for past couple years. I’ve had various salespeople pitch me. And I’ve found Nothing is Ever actually free and leasing is not cracked up to what they are saying. IMO you lease when you can’t afford to buy which is something to think about… This is just my opinion but. I now actually have a sign in my door that says NO SOLAR SALES Because of the amount of companies popping up with door to door sales… And just the simple fact they are like vampires. Once you let them in they just won’t go away lol . But anyway at best You will save a little. THEY however will make a ton. the Downsides I’ve found I’ll first have holes drilled into my brand new 50 year shingle. In twenty five years I’ll either sign a new lease which i wont live long enough to see out. Or ill have to buy them outright Which Now im buying panels that are not producing to there maximum wattage. And will continue to decline from this point as they have a lifespan of about 50 years IF you get a good panel. My homeowners will go up once i own them. Not a dealbreaker… but i will be paying to maintain them and since there now out of there peak performance age. that could get expensive. During my rental they will tell me it increases the price of your home. That’s Not true. I can not sell what i don’t own. If anything it makes my house harder to sell because a potential buyer will have to buy into the remainder of the lease. And if they want the house but not the lease. They could potentially ask me to reduce the price to take on the burden of the lease. I’ve actually spoken to Various realtors that have said this. Or worse they will tell me only if I remove them will they buy the house . and if I do remove them. Now I’ll have to repair the roof and pay penalties to break the lease. Which basically means I just lost a buyer. And once removed if the shingles are no longer available. I’m beat. I’ll have different colored shingles on the front of my house. If course I could buy and store 10 bundles of shingles now to avoid this …. I’ve found ONLY if I own the panels can i reap all of the rewards. and currently they just have not gotten the costs low enough for me to go for that either . A system for my house was 9Ok to buy. I could potentially get back even in anywhere from 12-20 years And start making or saving decent money at that point depending on various things. But if I decide to or even need to sell and move before that for whatever reason. It’s a total loss . The national average is at best I think is about 13% increase in value only if I own them which is appealing. I see a lot of panels popping up all over. Not sure whose buying or renting. However if I decide to go solar At best if I would buy a system 1/4 if the size of what is needed to power my house so I’m not putting out 90k. I’d still save some money. And even with that small if a system. I could still add 8-10% value to my home. I could also add to the system once I’m in the black from this small initial install. If I end up going solar. That’s the only option I would personally choose . I just personally can’t find enough value in leasing. It seems at least to me. A lot of potential issues to save maybe 100 bucks a month.. And worst case I have found some articles suggesting that some companies are willing contracts where you could potentially save close to nothing . There’s a lot of fine print in the rental contracts. And all companies have the potential to have very different contracts….

  8. Anonymous

    I have a client he told me it is free he didn’t pay anything for them to come inspect, pull permits, install and use the solar panels. It’s had it for 9 years. For example what would of been a $100 bill became a mere $30 After solar. He even run his AC 24/7 during the summer. He said there were solar reps at the Home Depot so I’d check them out, seems legit.


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