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Buying solar on finance: Why it’s a smart move

Buying solar on finance: Why it’s a smart move

Why pay for solar with cash? You finance your car and your phone – why not solar as well?

Solar pays for itself. A well-designed solar panel system, paid for on finance, should be cashflow positive from day one.

Your electricity bill savings should be higher than your loan repayments from the start. Then when your loan is repaid you get the full benefit of all the electricity savings.

And you achieve this without using your own cash.

Check out the deals on our website to see how little you need to invest upfront to go solar.  For example, a 6.6kW solar system for $99 out-of-pocket and a 10kW system for $900 out-of-pocket.

On this blog, we explain the advantages of buying solar on finance and provide examples of the savings you can make.

  • Advantages of buying solar on finance
  • Example: 10kW solar system
  • About Plenti, our finance partner

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Advantages of buying solar on finance

  1. Better off from day 1

Even with monthly repayments, with solar you should be financially ahead from the start.  Because electricity prices are so high, a solar panel system can significantly cut your electricity bills.  The savings can be hundreds, or even thousands of dollars a year, depending on how much electricity you use.

This means your electricity bill savings should be higher than your monthly finance repayments. That’s even with a repayment period of 4 to 5 years.  And, of course, after that you get the full savings on your electricity bill for another 20+ years (i.e., the life of your solar system).

  1. Reduce electricity bills

The longer you wait to install solar, the longer you keep paying more than you need to for electricity.  With solar finance, you don’t need to wait.  You can get solar panels installed now and enjoy lower electricity bills immediately.

  1. Keep your cash

Unexpected expenses can crop up at a moment’s notice. That’s why it’s good to have cash in your kitty for ‘just in case’.  There’s nothing like knowing you’ve got enough to cover you in case your car breaks down, you have an unexpected medical cost or something big needs fixing around your home.  With solar paying for itself right from the start – even with loan finance – there’s no need to dig into your own savings.

  1. Protection from rising electricity prices

No-one likes bill shock. Least of all a mega power bill that comes out of the blue. The best way to protect you and your family from escalating energy costs is to install solar. With solar, you have the infrastructure in place to de-risk your home from rising gas prices as well.  You can think about a gradual transition to an all-electric home that’s 100 per cent powered by free electricity from your solar panels system.  With new solar technology available that makes it easy to add more panels and a battery later, you can start with what you need – and extend it later without worrying about your investment going to waste.  Get in touch if you would like to know more.

  1. Get solar rebates before they drop

The Federal Government’s solar rebate – called Small-scale Technology Certificates (STC) – cuts the cost of solar by around 30 per cent.  However, this rebate is being phased out, with an annual reduction in value through to 2030.  Buying solar today means you’ll get the STC solar rebate at its current high value.  Wait a year, and the value of that rebate will be lower – around several hundred dollars depending on your size system.

The same goes for state government solar rebates such as the Victorian Government’s solar panels rebate available through the Solar Homes Program. Currently worth up to $1,400 this rebate gradually being scaled back through to 2030.

  1. Cheap finance

Interest rates are at an all-time low in Australia.  Loan finance is as cheap as it has ever been.  And with solar paying for itself immediately, you won’t need to take out finance for a long period.  Most of our customers find the ‘sweet spot’ to be a repayment period of between four to five years.
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Example: 10kW solar system

Here’s an example of the costs and savings (as of 03/2022) for a typical high quality 10kW solar panel system in Melbourne installed by SolarRun. This is an ideal size system for larger homes.

  • Pre Solar Vic rebate price: $8,100
  • Solar Vic rebate: $1,400
  • Interest-free loan: $5,800
  • Out-of-pocket cost: $900
  • Monthly electricity bill savings: $220 (approx.)
  • Monthly repayments on interest-free loan*: $114 – Approx savings per month $178, Cash flow positive $63 per month, Cash flow per year for $763
  • Loan period: 48 months
The monthly electricity bill savings are based on:
  • Grid electricity: 27 cents per kilowatt hour
  • Solar exports: 7 cents per kilowatt hour
  • Consumption of solar electricity in the home: 50 per cent

These are realistic assumptions for most larger family homes in Victoria.  The most important thing for you to know about solar is this:

The more solar power you can use in your home, the greater your bill savings. 

To get the lowest electricity bills, you need to minimise the amount you export to the grid – and use as much of your solar power as possible in your home.  That saves you from having to buy expensive grid electricity.  And that’s where solar really saves you money!  It’s called maximising your solar self-consumption.

As you can see from the above example, right from the start this family home would be $63 ahead every month with a 10kW solar system purchased through SolarRun with interest-free finance.  Then after 5 years when the finance is paid off, the family benefits from the full electricity bill savings of around $220 a month.

About Plenti, our finance partner

At SolarRun, we offer interest-free finance through Australia’s #1 rated consumer lender Plenti.  We’ve partnered with Plenti because:

  • They offer amongst the best rates in the market
  • They’ve got more 5-star reviews than any other personal lender
  • They’re keen on green: having helped over 17,000 households with $120m+ in solar and home battery loans
  • They have a fast, simple loan application process

Get in touch

If you’re interested in buying solar on finance, get in touch.  We can provide a quote showing the finance costs and savings for your property. With that information, you’ll be able to see exactly how solar on finance stacks up for your home and budget.

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