Power purchase agreement (PPA)
A power purchase agreement where a company owns the panels on your roof and you pay only for the electricity they produce, at a set per-kWh rate.
Under a solar PPA, a third party installs, owns, and maintains the system at no upfront cost, and you simply buy the power it generates at an agreed rate per kilowatt-hour — usually below your utility's rate, often with an annual escalator.
Because the provider owns the equipment, it claims the commercial Section 48E credit and passes some value through. With the residential 25D credit gone in 2026, PPAs and leases are the main way homeowners still benefit from a federal solar incentive — but you don't own the system or its long-term savings.
Put it to work
See also