Breaking down the financing options for solar panel systems
Installing a solar panel system can be an investment. While paying in cash or via a traditional loan has many benefits, many homeowners are now opting to get the benefits of solar in other ways. According to the 2025 Aurora Solar Snapshot, more than half of installers state that customers are turning to third-party ownership (TPO) models, such as leases and power purchase agreements (PPAs) — the two most common options.
While they are very different forms of financing, both leases and PPAs often allow homeowners to put $0 down on their new system. Solar leases involve a flat rate monthly payment, while PPAs allow the homeowner to buy the power the solar panels produce at a discounted rate. There are additional differences regarding who owns the system’s incentives, such as the Residential Clean Energy Credit.