With a solar PPP worth USD 0, you pay nothing in advance and you agree to pay a fixed rate per kilowatt-hour (kWh) for the duration of the agreement. In most cases, the rate will increase from 1% to 3% each year. The financial benefits of owning the system, such as rebates, federal and federal tax credits, belong to the third-owner. For someone who doesn`t yet have a thorough understanding of how solar energy saves money on their electricity bill, the difference between an AAE (Power Purchase Agreement) and leasing can be subtle and almost indistable. Solar leasing and solar AAEs are agreements by which the homeowner does not own the solar installation on their roof, he is in the possession of the leasing company or PPP. There are pros and cons between this model and a traditional Solar Renewable Energy Credits: Generally for an electricity purchase contract, SRECs (explained here) are owned by the developer. Be sure to clarify secS ownership prior to AAE and understand the effects of SECS in terms of ownership and price. Performance and maintenance: The leasing company will monitor the performance of the system to ensure that it works properly for the duration of the lease. They are also responsible for maintenance and repair, although solar panels require little or no maintenance over their lifetime. We fund the entire installation of your commercial PV facility so that your company can enjoy the benefits of photovoltaic installations while preserving your capital. Use our capital today to start your journey with clean energy and buy back the system at some point, if the timing is right, from us – if you wish. Here`s the difference between a solar lease and simple English solar PPA, but most of you need to keep reading to fully understand. It is customary to sell an AAE or lease by one company, which then sub-processes the installation to another, and another has the plates and equipment.
This scenario is common in the leasing and AAE industry, because the company that sells a lease or AAE is not responsible for the maintenance or production of the solar installation, they are simply “brokers” between the owner and the company to which the system belongs on the roof. While this regulation does not necessarily mean that the owner receives a sub-par system or is misled, it may lead to complications in the future. For example, five years later, the owner discovers that his system does not produce the promised solar energy. They report the problem to the company that sold them the system, expecting the problem to be resolved quickly.