One effective model for financing solar projects is known as Third-Party Financing. With Third-Party Financing, the solar energy system is owned and operated by an entity that is separate from the building owner or the solar installer. The Third-Party Financing entity has sufficient financial capital to pay for the entire installation and to maintain and operate the system over its lifetime. In return, the building owner, or “host” site, signs a long term contract agreeing to purchase all the power produced by the solar energy system, known as a Power Purchase Agreement (PPA). Third-Party Financing is a way to install a large PV system with little or no up-front capital expense from the building owner or “host” site and is most applicable to non-profit entities.

With a lease-to-own financing agreement, the customer will typically make no or little down payment and purchase the system with fixed monthly payments over time. This is a great approach for customers interested in system ownership without the burden of a substantial upfront investment.

For more information, see Rahus Institute’s "The Customer’s Guide to Solar Power Purchase Agreements"