Power Purchase Agreement (PPA)
Pay only for the power it actually produces
A Power Purchase Agreement (PPA) works like a mini utility contract with your own roof -- a provider owns and maintains the system, and you pay a per-kilowatt-hour rate for the electricity it actually generates, typically lower than your utility's rate.
How it actually works
Instead of a flat monthly payment, your bill scales with actual production -- more sun, more power generated, and you pay for that power at the agreed rate. If the system underproduces in a given month, you pay less; there's no fixed minimum tied to a projection.
The provider owns, monitors, and maintains the equipment for the life of the agreement, typically 20-25 years.
What you actually get
Zero upfront cost, no maintenance responsibility, and a rate that's typically set below what the utility charges. The agreement is fully transferable if you sell the home.
What to weigh
You don't own the system and don't directly receive tax incentives. Some PPAs include a small annual rate escalation clause -- that's worth reading closely in the actual agreement rather than assuming, since terms vary by provider and contract.
At a glance
- ✓Zero upfront cost
- ✓Pay a per-kWh rate typically lower than utility rates
- ✓Provider owns and maintains the system
- ✓Typically a 20–25 year agreement
- ✓Fully transferable upon home sale
- ✓Customer does not directly receive tax credits
See what this looks like on your home
Run your average monthly bill through our sizing calculator for a real system size and price estimate, then we’ll help you match it to power purchase agreement (ppa) or another structure.
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