How Does Solar Financing Work in Florida?
Florida’s abundant sunshine makes it a prime state for solar adoption, but many residents wonder how to handle the costs. Some households and businesses purchase their solar systems upfront, while many more rely on solar financing to make the investment manageable. Solar financing includes options such as solar loans, solar leases, and third-party ownership (TPO) programs like power purchase agreements (PPAs). These methods make solar power attainable for homeowners who might not be able to pay the entire price in cash.
Paying with cash gives you full ownership from the start, meaning you receive all available benefits from solar incentives like the federal Investment Tax Credit (ITC). This path delivers the largest lifetime savings but requires significant capital upfront. Financing, on the other hand, spreads payments out, allowing Floridians to transition to clean energy while keeping money in their savings accounts. The trade-off is that financing introduces monthly payments or interest charges that slightly reduce short-term savings.
Florida does not have a statewide rebate program, but homeowners and businesses can take advantage of the 30% federal ITC, property tax exemptions, and net metering programs that credit them for excess energy sent back to the grid. Some utilities also offer rebates and performance incentives. Together, these solar incentives increase the appeal of financing by reducing overall system costs.
Buying Solar Outright vs. Financing
| Feature | Cash Purchase | Solar Financing |
|---|---|---|
| Upfront Cost | High | Low to None |
| Ownership | Immediate | Depends on financing type |
| Tax Incentives | Full benefit | May vary with TPO |
| Long-Term Savings | Greatest | Moderate to high |
| Maintenance | Homeowner responsibility | Often handled by provider |
Solar Financing Options in Florida
Floridians can choose from multiple financing models depending on budget and goals.
Cash Purchase vs. Solar Financing
An upfront cash purchase maximizes savings since there are no financing costs, but the average $20,000 to $30,000 price tag makes it impractical for many families. Financing spreads that cost out through monthly payments, allowing more residents to install solar systems without tapping heavily into savings.
Popular Financing Options
- Solar Loans: Homeowners borrow from a bank, credit union, or solar installer and repay in installments until they own the system
- Solar Leases: A third-party company owns the panels and charges the homeowner a flat monthly fee
- Power Purchase Agreements (PPAs): Instead of a flat fee, the homeowner pays for electricity at a set per-kWh rate, typically below utility rates
In Florida, about 60% of homeowners finance their systems through loans, roughly 25% pay cash, and 15% use leases or PPAs. Leases and PPAs are especially appealing to those looking for “free solar,” since they require no upfront payment.
Types of Solar Loans in Florida
Florida residents can access a wide variety of solar loans through banks, credit unions, installers, and specialized clean energy lenders.
Secured Solar Loans
Secured loans require collateral, usually tied to home equity. These loans provide lower interest rates and longer terms, but the risk is that defaulting could put your property at stake.
Unsecured Solar Loans
Unsecured loans do not require collateral. Approval is quicker and based on credit and income, but interest rates are typically higher, and terms are shorter compared to secured loans.
Installer and Credit Union Loans
Many Florida solar companies partner with lenders to offer loans directly to customers. Credit unions also play a strong role, offering community-based financing options with flexible repayment terms.
| Type | Secured Loan | Unsecured Loan |
|---|---|---|
| Collateral | Required (home equity, assets) | Not required |
| Interest Rate | Lower | Higher |
| Approval Process | Slower | Faster |
| Risk | Property may be at risk | No asset risk |
Most solar loans in Florida range between 5 and 25 years, with average interest rates from 3% to 8%, depending on credit history and lender.
How to Find the Best Solar Loans in Florida
Choosing the best solar loan means balancing monthly affordability with long-term savings.
- Loan Duration: Short-term loans have higher monthly payments but lower total interest. Longer terms keep payments manageable but increase lifetime costs
- Interest Rate: In Florida, strong solar loan rates typically range from 4% to 6%. Anything below 4% is excellent, while rates above 8% may cut into financial benefits
- Repayment Flexibility: Loans that allow early payoff without penalties give borrowers the chance to save on interest
- Down Payments: Some loans require no upfront payment, while others ask for a partial down payment
The best solar loan is one that fits the homeowner’s financial goals, keeps interest manageable, and provides flexibility for repayment.
Can I Get Free Solar Panels in Florida?
“Free solar” does not mean the panels come without cost; instead, it refers to financing methods like leases and PPAs that require no money upfront.
Solar Leases
In a lease, a third-party company owns the equipment, and the homeowner pays a predictable monthly fee. This reduces utility bills but means the homeowner cannot claim solar incentives or benefit from system ownership.
Power Purchase Agreements (PPAs)
With a Power Purchase Agreement (PPA), homeowners pay only for the electricity produced by the solar system. Rates are generally set below local utility prices, so savings are realized on each kilowatt-hour used.
Benefits of Leases and PPAs
- No upfront cost
- Lower monthly bills than traditional utility service
- Provider handles installation, maintenance, and performance monitoring
These options are most beneficial for homeowners seeking immediate savings with minimal financial responsibility, though they do not provide the long-term returns of ownership.
How to Get Solar Financing in Florida
The steps to secure solar financing in Florida differ based on the method you choose.
Steps for Solar Loans
- Check Your Credit Score – Most lenders prefer scores above 650
- Get Multiple Offers – Compare options from banks, credit unions, and solar companies
- Review Loan Terms – Pay attention to rates, length, and repayment rules
- Apply – Provide documentation of income, credit, and system details
- Installation and Repayment – After approval, the system is installed, and monthly payments begin
Solar loans can positively impact credit if managed responsibly but may temporarily affect debt-to-income ratios.
Steps for Leases and PPAs
- Choose a Provider – Select a company offering third-party financing
- Review Contracts – Pay attention to escalation clauses, monthly fees, and buyout options
- Sign Agreement – The provider installs and maintains the equipment
- Start Saving – Once activated, you pay reduced monthly energy costs