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What Is Solar Bill Swapping?

Have you heard of solar bill swapping? Do you know the benefits about solar installation financing payments? Learn all about it here!

In a perfect world, we all could hand over cash and immediately own a beautiful, cost-saving home solar installation. But this is reality, so we have to strive for our solar goals per our personal budgets.

Fortunately, getting your own home solar installation is well within reach! And that’s great news — solar is a lucrative investment that brings you decades of reliable power and ultra-low (or free) electric bills. 

The key lies in finding your prime financing option — and you have multiple solar financing options! One of those happens to be solar bill swapping, and it’s vital when you’re not flush with free cash.

So, what’s solar bill swapping, and how can the method make going solar simpler for you?

[Related: What To Know Before Installing Solar Panels]

Solar Bill Swapping: The Basics

With bill swapping, solar installation financing payments basically replace electric bill payments.

In short, solar bill swapping isn’t as much one single option as it is several ways to pay for an installation. The idea is to “swap” the cost of your monthly electric bill for your monthly solar financing bill. You have three main ways to approach solar bill swapping: loans, home equity and solar panel leasing/power purchase agreements (PPAs).

In other words, you have a solar installation that significantly lowers or covers your electric bill. The money you’d put toward that bill instead goes toward buying or leasing a solar panel installation. Naturally, the costs may not match to the penny.

It may seem like apples to apples on the surface, but it’s a long-term cost-saving investment. Solar offers a hedge against rising energy costs and locks in your bill for the next 25 years!

So you do more than break even — you’re purchasing an installation instead of tossing money you’ll never see again to utilities.

[Related: Possible Solar Panel Customers: Who Could Benefit?]


Taking out a loan for a solar panel installation is the savviest of the three key solar bill swapping routes. For one, you can purchase and use a solar installation quickly.

We’re sure you know how most loans work! After borrowing money from a lender (sometimes with no money down), over time you repay that amount, plus interest. You’re free of monthly payments after repayment is complete, per the period you set with your lender. 

If you use loans for solar bill swapping, you have the concurrent benefits of a solar installation slashing your electric bills and increasing your home’s price.

In fact, loans work particularly well for solar bill swapping for several reasons. Monthly solar loan payments are often comparable to electric bill cost savings for average households. You also get those perks that come only with owning your panels, like federal, state and local rebates and incentives.

Tip: When exploring loans, really scour your options! Loads of lenders and plans are available, and doing your research goes a long way. Some lenders, including some solar installation companies, offer loans specifically for solar installations.

[Related: Choosing the Right Panels and Determining the True Cost]

Home Equity

Another solar bill swapping option is using a home equity line of credit (HELOC) or cash-out refinance. These apply when your home’s value has increased after purchase (i.e., home appreciation).

With a HELOC, you use your home equity as credit. Generally, you borrow only as much as you need to pay for an installation. Remember that your interest rate may vary, but you don’t have to pay interest on any funds you don’t use. 

With a cash-out refinance, you get a higher-dollar mortgage in place of your current home loan. Then, you use the difference between the two amounts to purchase a solar panel installation. Again, it’s smart to borrow only as much as you need to pay for the installation.

In both instances, the funds you borrow let you purchase a home solar installation. In turn, its electric bill savings balance out the HELOC or cash-out refinance payments. Although not as straightforward as loans, HELOCs and cash-out refinances are both viable solar bill swapping avenues.

Tip: HELOCs are usually more lenient than cash-out refinances. The latter involves getting an entirely new mortgage, so the process takes longer. 

[Related: How Solar Panels Affect Home Insurance]

Leases and PPAs

Your third primary options for solar bill swapping are solar panel leases and PPAs

With both options, another entity (a company, etc.) installs a solar panel system at your home. You can then enjoy its benefits, such as lower monthly electric bills. At the same time, you pay the entity that installed the solar panels monthly.

The basic solar bill swapping principle is the same. You save on electricity costs with the solar installation. Those savings balance out the payments to the entity owning the solar installation. 

However, unlike loans, HELOCs and cash-out refinances, you don’t own the solar installation in any way. And that means you can’t take advantage of rebates and incentives — it can feel a lot like throwing away money. Sure, it’s nice to enjoy alternative energy with no up-front costs, but you essentially rent the installation indefinitely. 

Leases and PPAs are usually your last choices when you opt for solar bill swapping. Plus, they make buying or selling a home with solar far more of a headache.

Note: At solar panel company Freedom Solar, we do not offer leases for solar installations. We want you to embrace all the benefits that come with energy independence, and those include owning your solar installation!

[Related: 6 Things You Should Know About Leasing Solar Panels]

Find Financing That Fits Your Budget With Freedom Solar

As an experienced solar panel company, at Freedom Solar we’re dedicated to making solar power easy and affordable for you. We know alternative energy is great for the environment — but it’s equally smart for your wallet

Our energy consultants work alongside you to find a financing option that meets your monthly budget. Many of our customers finance a home solar installation with no money down and low-to-no interest

We offer SunPower solar panels and backup batteries for homes and other power storage solutions that provide durability and reliability even in precarious times. And our 25-year lifetime warranty ensures you can rest easy about your installation and investment.

When you’d like to explore your solar financing options, get in touch! 

Give us a call at (800) 504-2337 or complete our inquiry form for a free consultation. One of our energy consultants will reach out to you ASAP.

Featured image via Pexels