Financing

Lease buyout cost calculator

Enter your original system cost, the contract length, and how many years have passed. Get an estimated buyout price range for that point in the lease.

Your numbers

1 Project details Optional
Shown on your exported report. Leave blank to skip.
2 Your lease
The full installed cost the leasing company paid, from your lease documents if listed, or a typical installer quote for a similarly sized system.
How many years have passed since installation.

How it works

Three steps to your buyout estimate

Step 1

Find your original system cost

Check your lease agreement, which sometimes lists the original installed cost, or use a typical quote for a similarly sized system if it's not stated. The system buyout value over time calculator shows the full curve across every year of the term.

Step 2

Confirm your lease term and years elapsed

Use the original contract length and how many full years have passed since installation. Most leases restrict buyouts before year 6, so check that clause in your agreement first, or compare against a PPA buyout scenario if your contract is structured that way instead.

Step 3

Request the exact figure from your provider

This tool gives a planning estimate. Your lease company's actual buyout formula is specified in your contract, so request the precise number in writing before making a decision.

Reading your lease buyout estimate

How lease buyout pricing generally works

Most solar lease buyout prices are based on the system's fair market value at that point in the contract, which declines over time as fewer years of production remain under the lease and the equipment ages. Early in the contract, a buyout can run 80% to 95% of the original system cost, dropping to 30% to 50% by the midpoint and often bottoming out around 10% to 15% near the end of the term. The DOE's homeowner's guide to solar financing covers lease structures and buyout mechanics in more general terms.

Why the exact number varies by provider

Every leasing company sets its own buyout schedule, and some publish a fixed percentage table in the contract while others calculate fair market value at the time of request using an appraisal-style method. That's why this tool's estimate is a planning range rather than a guaranteed figure, and why the exact number in your contract always takes priority. The home value increase from solar tool can help you think through the ownership side of that value once a buyout is complete.

Whether buying out early or late makes more sense

Buying out early costs more in absolute dollars but gives you more years of ownership and freedom from the lease's remaining escalator payments. Buying out late costs less but leaves fewer years to recoup that investment through ownership before the system reaches the end of its productive life, typically 25 to 30 years. The system buyout value over time calculator shows how the buyout amount itself shifts across the full contract, not just at one point. The commercial PPA vs ownership tool covers a related decision if the system is for a business.

How this compares to a PPA buyout

PPA buyouts generally follow a similar fair market value logic to lease buyouts, since both structures involve the provider retaining ownership until a buyout occurs. If you're weighing a PPA specifically, the PPA vs lease comparison covers how the two structures differ before a buyout is even considered.

What to check before requesting a buyout

Ask your provider for the exact buyout amount in writing and whether it includes any transfer or administrative fees. A buyout doesn't create new federal tax credit eligibility, since the residential credit expired for new claims after December 31, 2025, but a tax professional can confirm anything specific to your situation. If you're moving instead of buying out, the lease transfer at home sale calculator covers that alternative path. The IRS Form 5695 instructions confirm the current eligibility rules directly.

Questions

Frequently asked

It depends heavily on how many years into the contract you are, since the buyout price declines as the system ages. On a $28,000 system under a 25-year lease, a typical fair market value buyout runs about 82% of the original cost in year 5, dropping to roughly 46% by year 15 and 28% by year 20.

The buyout is generally based on the system's fair market value, which declines as the equipment ages and as fewer years of production remain under the contract. Panels typically retain 80% to 90% of their original output after 25 years, so the decline in buyout price reflects depreciation and remaining contract value more than a drop in the equipment's actual usefulness.

Many homeowners buy out around year 6 or later, since some leases restrict a buyout before that point and the price has already declined meaningfully from the year-1 figure. Buying out earlier costs more but locks in ownership and the ability to claim tax benefits sooner.

No, not for a buyout completed in 2026 or later. The federal residential solar tax credit expired for new claims on systems installed after December 31, 2025, and a lease buyout doesn't create a new installation date, so it wouldn't create new eligibility even if the underlying system was installed earlier. Check with a tax professional about your specific situation, since the original lease provider may have already claimed a separate credit when the system was first installed.

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