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Customer owns the system, uses the tax credit and accelerate depreciation
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Term is available up to 10 years
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After term of the lease expires, the customer will buy system for a fixed pre-determined amount,
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usually $1.00 or 20% of system cost
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Lease payments will be much higher than projected cost savings produced by the system, but solar incentives can be used by the customer to make up the difference in overall cash flow. In this respect, and for tax and accounting purposes, the Non-Tax Lease is very similar to a bank loan.
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Benefits of a Tax also known as a True Lease
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The Lender owns the system and receives the tax benefits The Customer enjoys greatly reduced monthly payments as a result, often at or below the cost savings of the system, so customer has net savings with solar. Term is up to 10 years; customer buys system at end for the greater of a stated percentage of original cost, usually 10% to 15% to 20%. For tax purposes, the customer can write off the solar lease payments and reduce taxes. Accounting-wise, the true lease may qualify as an "off-Balance Sheet" financing transaction.
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Written by Syracuse Solar and Wind Installer