Are "free solar panels" really free?

You've probably seen the ads: "Free solar panels!" "No-cost solar!" "$0 down!" They're everywhere—plastered across social media, tucked into search results, maybe even on a flyer stuck to your door. The pitch sounds incredible: Clean energy on your roof without spending a dime upfront. So what's the catch?

Here's the reality: "Free solar" typically means solar with no upfront cost—not solar you'll never pay for. These offers often refer to solar leases or power purchase agreements (PPAs), financing options where a solar company installs panels on your property without requiring a down payment. You don't own the system, but you do get to use the electricity it generates, typically at rates lower than what you're paying your utility right now. You're trading your utility bill for a solar payment.

These arrangements have been around for years, and they've helped millions of homeowners go solar who couldn't afford the average $30,000 upfront cost of buying a system outright. But the solar financing landscape has evolved significantly. Today, you have multiple ways to go solar with little to no money down—each with different pros and cons for your savings, ownership, and long-term flexibility.

We'll break down what "free solar panels" actually means, how different financing options compare, and what you need to know to make a smart decision.

When companies advertise "free solar panels" or "no-cost solar programs," they're often referring to solar leases or solar PPAs. Under these solar financing arrangements, a solar company will put a solar panel system on your roof at no up-front cost for installation, enrollment, or maintenance. You get to power your home with clean energy without any upfront payment—but the solar panels aren't free.

Here's how it works: You don't technically own the system. The solar company retains ownership, and you pay them for the electricity it produces, typically at a rate lower than your current utility charges.

While many lease and PPA deals can legitimately save you money, if they're advertised as "free solar," you should be skeptical of that provider. Watch out for annual escalators that significantly increase your payments over time, as well as details about how the agreement may affect a future home sale. Read the terms carefully to understand your total costs over the contract length.

Some companies advertise free solar so they can sell your information. Check out these sponsored Google ads offering "no cost solar," "free solar," and "government funded solar energy." They're all misleading. When you click on any of these ads, they bring you to pages where you need to provide personal information, including your phone number, before you can learn what the offer includes.

Despite what misleading ads suggest, you can't get free solar panels from the government. These ads typically refer to the federal solar tax credit, which expires for residential systems installed after December 31, 2025, and is no longer available to most homeowners due to limited installer capacity.

Solar leases and PPAs still qualify for the federal tax credit until 2028, but the credit is paid directly to the system's owner—typically the solar provider. Reputable providers should pass some of these tax credit savings along to you in the form of lower monthly payments, making leases and PPAs competitive options.

Beyond the federal credit, many states, utilities, and local governments offer incentives that make solar more affordable if you own your system—whether through a cash purchase or a loan. The key is understanding which incentives you're eligible for.

Here are some of the most common incentives still available:

SRECs and performance-based incentives

Two programs you may encounter include Solar Renewable Energy Credits (SRECs) and performance-based incentives. Some states have solar carve-outs, which mandate that a set amount of electricity generation must come from solar specifically. In these states, SREC markets facilitate the sale of solar certificates. You'll earn one SREC for every megawatt-hour (MWh) your system generates. An aggregator or broker (like SRECTrade or SolSystems) will help you sell your SRECs in exchange for cash. 

Performance-based incentives are rewards for producing a certain amount of solar energy. For example, if you're eligible for performance-based incentives, your utility would pay you to produce a set quantity of electricity from your solar system, whether you use it or send it back to the grid.

State and local incentives

Many states offer incentive programs like tax credits, but they vary from state to state. Depending on where you live, you may also be able to take advantage of state net metering programs through which your utility company compensates you for excess kilowatt-hours (kWh) of electricity you generate and send to the grid. Some local cities and counties also offer direct rebates to help with the upfront costs of solar panel installations.

If you're looking for free solar panels on your roof, or at least solar panels with less cost upfront, solar leases and solar loans are good options. Regardless of its "do-good" image, the solar industry is a for-profit enterprise like any other. So, even if financial gain is secondary to environmental considerations, you should still shop around to get the best deal.

Sign a solar lease or PPA

Solar lease providers make money by selling you electricity, usually at a lower rate than what you pay your utility. With leases and PPAs, you'll see lower lifetime savings than ownership, but you preserve capital flexibility. And, the solar company handles all maintenance and performance responsibilities.

Take out a zero-down solar loan

Solar loans let you own the system without the upfront cost. With ownership comes the ability to claim available state incentives and the flexibility to manage your system as you see fit. You'll make fixed monthly payments (often with $0 down upfront) over 5-25 years while immediately benefiting from energy savings. And, once the loan is paid off, the electricity is free, and you keep 100% of your savings.

Cash purchase, loan, or lease: Which is best for you?

The real question isn't whether "free solar" is truly free (it's not—you'll pay over time through monthly payments). The question is which financing path makes the most sense for your specific situation. Do you want to own your system and maximize long-term savings? Preserve capital for other investments while still benefiting from solar? Avoid any upfront cost whatsoever?

Comparing multiple quotes is the best way to understand your options and find the right fit. When you sign up on the EnergySage Marketplace, you'll receive custom quotes from solar installers in your area. Whether you're considering a cash purchase, $0-down loan, or lease/PPA, seeing multiple offers side-by-side helps you evaluate which path aligns with your priorities—you can even use our solar calculator to get a quick estimate.

Because while solar panels themselves aren't free, the electricity they generate for 25+ years can dramatically reduce what you're paying for power—and that savings potential is very real.