How To Get Solar Panels “For Free”: Is It Possible?


Unfortunately, you cannot get solar panels for free. Even so-called “free” no-money-down solar leases and power purchase agreements come with financial commitments that could be costly in the long run. However, though getting solar panels for free is not possible, there are financing options available like HELOCs and solar loans to help homeowners afford these renewable energy systems.

Solar panels are an excellent way to save on energy bills and lower your carbon footprint — but they don’t come cheap. And unfortunately, there isn’t any sneaky way to snag solar systems for free. Though most solar companies use words like “free solar panel programs,” this is only to market their $0-down solar leases or power purchase programs.

But don’t worry, while solar panels might not be totally gratis, there are still plenty of financing options and government incentives to help you reduce the cost of powering your home with green energy. In this article, we’ll explain what solar leases and power purchase programs are and provide a few solar panel financing options you can take advantage of.

Can you get solar panels for free?

Unfortunately, you cannot get solar panels for free. When a solar company claims to offer a “no-cost solar program,” they’re typically tempting you into signing solar leases or power purchase agreements.

Under these agreements, the solar company installs the solar system on your rooftop or property without requiring you to pay upfront. However, you still have to make fixed monthly payments for using the panels or pay for the clean energy produced by those solar panels. In other words, you don’t own the solar panels outright, and the solar company retains full ownership, though you do benefit from energy savings.

How do solar panels work?

According to U.S. Department of Energy, solar panels use photovoltaic (PV) technology, which converts sunlight into an electrical current. Sunlight is made up of photons, which excite the electrons found in PV cells and cause them to flow. This flow of electricity is used to power our houses, cars, and many other electronic items.

Because solar panels need the sun to work, they can only operate when the sun is up. However, you could still use the power stored by your solar energy system during the day to power your home at night.

Since the average household in the country spent around $121 a month on their energy bill in 2021, you could see savings of over $1,400 a year. Of course, this is if your solar energy system is robust enough to cover your energy usage entirely.

“Free” solar panels’ hidden costs

Here are the hidden costs associated with the so-called “free” solar panels that many solar companies use to reel in customers.

  • Leasing. Though solar leases require as little as $0 down, you pay the solar company a fixed monthly “rent” in exchange for using the system. Depending on various factors, the monthly fee could be anywhere from $50 to $250. Most solar leases last around 20 to 25 years — the average lifespan of solar panels.
  • Power purchase agreement. With a PPA, you also don’t own the solar panels outright. Instead, you pay the solar company a fixed price per kWh for the power generated.

Alternative solar panel financing options

Solar panels, with costs upwards of $20,000, can be expensive even with government solar incentive programs. If you’re looking to get solar panels installed in your home but don’t want to break the bank, here are some financing options to consider.

Personal loan

Personal loans are unsecured loans (no collateral required) that can be used for anything — including big-ticket purchases. If you’re approved for a personal loan, you’ll receive a lump sum that you repay with fixed interest over a specific period of time.

Though personal loans are a quick and rather hassle-free way to borrow the funds you need, they could come with high APRs — especially if you have sub-par credit. Before signing up for the first personal loan you find, take a look at some of your options below.

Home equity loan (second mortgage)

A home equity loan allows you to borrow money based on the equity you’ve accumulated in your home. Once approved, you’ll receive a lump sum with specific terms as to when the repayment of interest and principal will be due.

Keep in mind that a home equity loan — also known as a second mortgage — is a secured loan, meaning that you must put up your home as collateral for the loan. If you’re unable to pay back the money you owe, your could lose your home due to foreclosure. To ensure you know what you’re signing up for, take a look at some of the home equity loans below.

Home equity line of credit (HELOC)

You can also pay for your solar panels with home equity lines of credit. A home equity line of credit (HELOC) is a type of secured loan that uses the equity in your home as collateral. With this type of loan, the loan issuer assigns you a credit limit that you can tap into whenever needed, offering you a flexible way to finance your solar panels.

Just as with other financing options, different HELOCs will come with different terms and interest rates. Make sure you compare all of your available options before signing the dotted line.

Solar loan

Solars loans are exactly what they sound like — loans that help you pay for solar panels. Here are some of the most common types of solar loans:

  • Green mortgages. Also known as energy efficient mortgages (EEMs), green mortgages allow property owners to borrow a secondary amount based on the home’s value after the solar upgrades are made.
  • Residential Property Assessed Clean Energy Program (R-PACE) solar loans. Residential PACE solar loans allow homeowners to attach the loan to their property and pay it back over 10 to 20 years with their property tax payments.
  • Secured solar loans. Many solar companies and retailers offer point-of-sale financing options like secured solar loans. If you default on the loan, the lender could repossess your solar panels.
  • Solar loans from utilities or local governments. Some states and local governments offer local solar incentives and loan programs to their residents. Check the Database of State Incentives for Renewables & Efficiency page to find out what local incentives are available in your area.

Pro Tip

Check your current electricity price when considering whether it’s worth the hassle to switch to a solar energy system. Generally, the higher your electricity price, the more money you can save by switching to solar power. Check out this monthly report by the U.S. Energy Information Administration to find out how much your electricity costs.


How much money could you save by installing solar panels?

Mitchel Hoffman, the Sr. Marketing Manager at Blue Raven Solar — a residential solar company — says, “How much homeowners can save each year by installing solar panels varies based on location, current utility consumption, size of the home, solar panel types installed, how the system is purchased/financed, and trade policy as well as available incentives, rebates, and tax credits. Over the lifetime of their system, typically 20 to 25 years, our customers have saved up to $50,000 in total on electricity costs.”

Is solar actually free?

Yes, solar energy is free since it comes from the sun. But unfortunately, solar panels themselves don’t come without a price tag. To make use of the abundant sunlight and turn it into usable power, you’ll need to install solar panels on your rooftop or property.

Though some companies claim to offer “no-cost solar programs,” they typically just mean you won’t have to pay anything upfront. You’ll still need to sign a solar lease or a solar power purchase agreement and make monthly payments in exchange for having the panels installed on your roof and consuming the electricity produced.

Which states get free solar panels?

No state in the country gives out free solar panels. However, the federal government enacted the solar investment tax credit (ITC) in 2006 to help lower your tax bill if you install solar panels on your roof. And if you install a solar panel system between 2022 and 2032, you’ll receive a 30% tax credit for the cost of the panels.

Several states (including Puerto Rico) offer solar incentives on top of the federal tax credit to encourage solar panel installation. These incentives include tax credits, renewable energy certificates, and rebates, and they can vary by state. Check out the Database of State Incentives for Renewables and Efficiency for more details.

IMPORTANT! Note that you must own the solar panels outright to qualify. In other words, if you sign a solar lease or a solar power purchase agreement, you won’t be eligible for the solar incentive tax credit. Also, you can only claim the tax credit once after installing the solar energy system.

Will the U.S. government pay for solar panels?

Yes, the federal government offers to pay 30% of your solar panel system cost with a tax credit if you install them on your rooftop or property between 2022 and 2032. To qualify, the solar PV system must be located in your residence, and you must own it outright instead of leasing it.

You may also qualify if you purchased an interest in an off-site community solar project. Consult the Homeowner’s Guide to the Federal Tax Credit for Solar Photovoltaics for more information.

What are the two main disadvantages of solar energy?

Though solar energy is a clean and renewable source of energy, it has its drawbacks. One of the main disadvantages of this energy source is its high upfront costs.

Initial costs for the installation range in thousands and often require professional installation, making it inaccessible for many. According to the latest information from the Center for Sustainable Energy, the average 5-kW residential solar energy system will cost $15,000-$25,000 — prior to tax credits or incentives.

Additionally, solar energy is highly dependent on location and weather, and will not provide a reliable power supply in regions with long periods of cloudy or dark days.

Key Takeaways

  • Though solar companies often advertise “free” or “no-cost” solar panel programs, these typically involve solar leases or PPAs that require fixed monthly payments in exchange for using the system.
  • If you’re looking for ways to finance your solar panel system without breaking the bank, there are a few different options you can consider. These include personal loans, home equity loans, HELOCs, secured solar loans, green mortgages, R-PACE loan programs, and solar loans from utilities or local governments.
  • The federal government offers a 30% tax credit if you install a residential PV system between 2022 and 2032. Some states also offer additional incentives like renewable energy certificates and rebates.

Learn whether solar power is right for you

Solar energy is a great way to help the environment and potentially save money on your monthly electricity bills. But before making the switch to solar energy, it’s important to do your research. Factors such as your household’s electricity use, utility price, and size of your roof space can all play a role in determining whether this switch makes financial sense and is cost-efficient.

If you’re thinking about taking out a personal loan to finance your solar panels, be sure to compare lenders carefully before committing to one.

View Article Sources
  1. Energy Efficient Mortgages — U.S. Department of Energy
  2. Find Policies & Incentives by State — NC Clean Energy Technology Center
  3. Homeowner’s Guide to Going Solar — U.S. Department of Energy
  4. Homeowner’s Guide to the Federal Tax Credit for Solar Photovoltaics — U.S. Department of Energy
  5. 5 Ways to Finance Solar Installation on Your Home — SuperMoney
  6. How Much Does It Cost to Install Solar Panels? 3 Ways You Can Save — SuperMoney
  7. How Much Does It Cost to Lease a Solar Power System? — SuperMoney
  8. Solar Loans: 4 Ways to Finance Solar Panels — SuperMoney
  9. How to Finance Solar Panels — SuperMoney
  10. Solar Loans ROI: 7 Factors to Consider When Calculating Solar Affordability — SuperMoney
  11. Thinking About Going Solar? Discover the Real Cost of a Solar Panel Installation — SuperMoney
  12. Can You Get a Tax Deduction for a Solar Loan? — SuperMoney
  13. How Do Solar Loans Work? A Complete Guide — SuperMoney