Solar Leases in Ohio: What Homeowners Need to Know Before Signing

Ohio is quickly emerging as one of the hottest markets for residential solar. Rising electricity prices and still-available incentives (through a lease model) are driving interest, and many homeowners are hearing about solar leases as a way to go solar with little or no upfront cost.  

But before you sign on the dotted line, it’s important to understand what solar leases are, their benefits, their drawbacks, and the risks of working with national companies that may not have long-term roots in the state. 

What Is a Solar Lease? 

A solar lease is a financing arrangement where a third-party company installs and owns the solar panels on your roof.  

Instead of paying for the system outright, you agree to pay a fixed monthly fee (or a rate based on energy production, called a Power Purchase Agreement or PPA) for 20–25 years. 

 The leasing company claims the federal tax credit and other incentives, and in theory, passes those savings to you through lower monthly payments. 

Why Are Solar Leases Gaining Popularity in Ohio? 

• Federal Incentives for Leasing Companies: While the homeowner tax credit (25D) ends in 2025, third-party-owned projects still qualify for the 48E ITC until at least 2027. Because they can take advantage of the tax credits, leasing companies are rushing to capitalize on this. 

• Low Upfront Cost: Because leasing companies can capitalize on tax credits still available for “commercial” entities, in theory they can pass these savings down to you. 

The Pros of Solar Leases 

• No Upfront Cost: You can start saving on electricity without paying upfront. 

• Maintenance Included: Most leases include operations and maintenance (O&M), so if something breaks, the leasing company handles repairs. 

• Production Guarantees: Many companies promise a certain level of energy production and offer bill credits if the system underperforms. 

The Cons of Solar Leases 

• You Don’t Own the System: This means you don’t get any increase in home value from owning solar. 

• Long-Term Contracts: Most leases lock you in for 20–25 years, which can complicate selling your home. 

• Limited Flexibility: You can’t easily upgrade or modify the system since you don’t own it. 

What to Watch Out For in Ohio 

• National Companies Chasing Incentives: Many large solar companies are entering Ohio to take advantage of the remaining tax credits. History shows that when incentives dry up, these companies often leave, leaving homeowners with service headaches. 

• Quality Control Issues: Leasing companies own the system, so they set strict installation standards. Make sure your installer is certified and reputable. 

• Exit Clauses: Understand what happens if you move or want to buy out the lease early. These terms vary widely and can be costly. 

Questions to Ask Before Signing a Solar Lease 

1. What is the annual payment escalation rate? 
2. Who handles maintenance and monitoring? 
3. What happens if I sell my home? 
4. Is there a buyout option, and what does it cost? And, when does it become available to me? 
5. How long has the company been in business, and do they have a local presence? 

Bottom Line 

Solar leases can make sense for some Ohio homeowners, especially those who want solar without upfront costs. But they’re not a one-size-fits-all solution. Before signing, weigh the pros and cons carefully, and make sure you’re working with a company that will be around for the long haul—not just until the incentives run out.