A solar lease buyout is the price you pay to own the panels outright instead of continuing to rent them. Contracts usually set it at fair market value or at a figure stated in the agreement, and many providers will not sell the system at all in the first five to six years because of tax rules. The only reliable number is a written buyout quote from your provider, which you can then compare with your remaining payments. This guide explains how the price is set, how to request it, and when buying out pays off.
By the Solar Bid Analyzer research team · Updated November 2026
How a solar lease buyout price is set
There is no standard formula, but the common structures are:
- Fair market value (FMV). Solar.com explains FMV reflects the equipment cost and the expected future revenue from the array. EnergySage adds that some agreements let you buy at FMV or a contract-specified price, whichever is higher. NREL's leasing guide describes end-of-term FMV as set by a third-party appraiser.
- Prepayment at net present value (NPV). The seller prepays the remaining lease or PPA payments at a discounted rate, and the buyer takes over with no payments left.
- Price stated in the contract. Tesla's lease terms say buyout is available after year five at the price set in the contract.
Solar.com cautions that early buyouts can cost more than a cash purchase of a comparable system, which it attributes to how corporate-owned systems are accounted for. FMV is not automatically a good deal. Treat the quote as a number to test.
When you can buy out
| Timing | What is typically available | Source or note |
|---|---|---|
| Years 1 to 5 or 6 | Usually no purchase; prepayment of remaining payments may be offered | Solar.com: buyouts "usually not within the first 5-6 years due to tax equity rules" |
| After year 5 (Tesla lease) | Buyout at the price set in the contract | Tesla support site |
| Home sale | Transfer to buyer, prepay at NPV, or buy at FMV and roll cost into mortgage | Solar.com; buyer must usually pass a credit check |
| End of term | Buy at FMV, renew or remove | EnergySage; Tesla; Sunrun 10-K |
These are the patterns reported by public sources; your contract controls. For background on lease structure, see solar loan vs lease vs PPA.
Tesla and other lease buyouts
Tesla's support site describes a 25-year solar lease with payments rising 3% per year, a buyout available after year five at the contract price, and end-of-term options to renew for five years, buy at FMV or have the system removed for a fee. It also says you can transfer the lease to a home buyer or buy out the lease after year five, with both started in the Tesla app. Sunrun's annual report says that at the end of the initial 20 or 25 year term customers can renew, buy at FMV or have the system removed. If you are looking at a Tesla solar lease buyout or a panel lease buyout from any provider, the same rule applies: get the figure in writing.
How to request a buyout quote
- Send a written request (email and certified mail) asking for the buyout price, the formula, the date the quote is valid and any fees.
- Ask for the remaining payment schedule and the escalator history.
- Ask what you keep or lose at transfer: monitoring, warranties, service.
- Ask for the paperwork that shows ownership changes, including release of any lien or fixture filing.
- If you are selling, ask for the timeline to closing; the provider coordinates with escrow.
Does buying out pay? A simple test
Compare the quote with what you would pay by continuing, using a hypothetical example. Suppose you are in year 10 of a 25-year lease paying $150 per month, flat, with 15 years left. Remaining payments total $27,000. You get a buyout quote of $16,000.
| Item (hypothetical) | Continue leasing | Buy out |
|---|---|---|
| Cash paid over next 15 years | $27,000 | $16,000 |
| Maintenance and repairs | Covered by provider (check contract) | Yours; inverters often need replacement after 10 to 15 years |
| Tax credit | Not applicable to you | Not available; 25D ended for new expenditures after 2025 |
| Net difference before repairs | - | About $11,000 less cash outlay |
If a leasing contract had a 3% escalator, the savings from buying out would be larger. Subtract expected inverter replacement and monitoring costs, insurance and the value of lost warranty or service. NREL notes that panel warranties commonly cover 20 to 25 years and inverters about 10, so inverter replacement is a real cost to price in. When the buyout is below remaining payments minus expected upkeep, buying out can make sense, especially if you plan to stay.
When you are selling, EnergySage says buyers may balk at a lease, and the New York guide notes the seller may need to buy out the system before sale so it can be removed. In that case compare the buyout with the discount you might offer a buyer. If the system needs to move or come off for a roof job, read about solar detach and reset first.
Warning signs in a buyout quote
- A figure with no formula or date.
- Pressure to decide the same day.
- Large unexplained fees or a requirement to buy before a refinance closes.
- A salesperson from another company offering to "buy out your lease" for a fee. Verify who actually holds the contract; see predatory solar financing.
Have an attorney review anything that places a lien on your home.
If a buyout quote seems high, get a second opinion before you commit. Ready to see how your own quote stacks up? Upload your solar quote for a free grade.
Frequently asked questions
How is a solar lease buyout price calculated?
It is usually fair market value, a price stated in the contract, or the discounted value of your remaining payments. Fair market value reflects equipment cost and expected future revenue. Ask your provider for the formula and the quote's expiration date in writing.
Can I buy out my solar lease early?
Often not in the first five to six years, because of tax-equity rules, though a prepayment of remaining payments may be offered. Tesla's lease, for example, offers buyout after year five at the contract price. Your own contract controls, so request the terms in writing.
Is it worth buying out a solar lease?
It can be when the buyout price is lower than your remaining payments minus expected repairs and lost services, particularly if you plan to stay. Compare the written quote with the remaining payment schedule, then price in inverter replacement and the loss of provider maintenance.
What happens to a solar lease when I sell my house?
You can usually transfer it to a buyer who passes a credit check, prepay the remaining payments, or buy out the system at fair market value. Buyers can be wary of leases, so start the transfer process early with your provider and agent.
Does the federal tax credit apply if I buy out my lease?
Generally not for you. The 25D credit applies to your own expenditures and ended for those made after 2025. Talk to a tax professional about your situation before assuming any federal credit applies to a buyout.
Sources
- Solar.com — Selling a home with leased solar panels
- EnergySage — Solar leases vs. solar PPAs: what's the difference?
- Tesla Support — Leasing solar
- NREL — Homeowners Guide to Leasing a Solar Electric System (2014)
- Clean Energy States Alliance and NYSERDA — New York State Homeowner's Guide to Solar Leases, Loans, and PPAs (2016)
- Sunrun Inc. — Form 10-K for fiscal 2025 (SEC)