Solar Lease vs PPA vs Buying in Hawaii: Which Is Best?

Independent Energy Hawaii offers cash purchase, solar loans through HSFCU and HOCU, and a prepaid lease through Participate Energy that costs about 30% less upfront. We’ll show you the numbers for each side by side.

Ownership, prepaid leases and third-party options

• Buy (cash or loan): You own the system. You pay for it upfront or through a loan, and you keep all the savings.

• Lease: A company owns the system on your roof. You pay a fixed monthly fee to use it.

• PPA (power purchase agreement): A company owns the system. You pay for the electricity it produces, usually at a set rate per kWh that’s lower than your utility rate.

Side-by-side comparison

Real examples: total cost matters most

• Prepaid lease (Participate Energy): an 8 kW system with one Powerwall 3 is about $42,000-43,000 cash, or about $29,500-30,000 with a prepaid lease. Paying about 30% less upfront for the same bill savings means about a 30% faster payback. Battery-only installs qualify too.

• Short loan vs. long loan: A $57,000 HSFCU loan on a similar IEH system (8-year term, 0% APR and no payments for the first 18 months, then 7.7% APR) is about $931 a month after the first 18 months and about $72,600 in total, based on 78 monthly payments after the 18-month introductory period.

Loan partners: HSFCU (APR as low as 7.7%, 8-year term, up to $75,000, 0% APR and no payments for the first 18 months) and HOCU (APR as low as 6.99%, 10-year term, up to $100,000, 0% APR and no payments for the first 24 months).

Examples only, based on typical system pricing. All loans are subject to credit approval. Rates and terms may change. Lease figures are examples and subject to approval.

Which is right for you?

• Buy with cash if you have the savings and want the best long-term return.

• Buy with a loan if you want ownership and savings without a big upfront payment.

• Choose an IEH prepaid lease if you can make an upfront payment and want a lower initial cost. Monthly leases and PPAs are third-party options, not IEH offerings; compare their contract terms carefully.

Questions to ask before signing a lease or PPA

• Does the payment or rate go up each year? By how much?

• How long is the contract?

• What happens if I sell my home?

• What happens if the company goes out of business? (Hawaii has seen this happen. See who services orphaned systems.)

• Can I buy the system out early, and for how much?

IEH prepaid lease versus a monthly lease

Participate Energy’s prepaid lease involves an upfront payment, typically about 30% less than the equivalent cash price. It also works for battery-only installations. Ownership, maintenance, transfers and buyout options are governed by the specific agreement. IEH does not offer PPAs. Review your actual contract and total costs, not just a monthly payment.

Financing examples are illustrative, not lender quotes. The HSFCU example assumes the eight-year term includes the 18-month zero-payment period, leaving 78 payments at 7.7% APR, with no fees. Confirm repayment timing, fees and actual disclosures with the lender. Subject to credit approval; rates and terms may change.