Financing solar for your business: buy it, lease it or sign up to it

A solar quote lands on the desk and it reads like a pitch for a different kind of business: a big number at the bottom, a payback period in years, and a line about “savings”. Then comes the question the quote doesn’t answer. Where does the money come from, and does it still make sense once you add the cost of paying for it?

The answer sits in how you finance it. The same roof, the same panels and the same electricity bill can come out as a clear win or a mild disappointment depending on which of four routes you take. Here they are, with the sums that decide between them.

What are the four ways to pay for solar?

Route	Who owns the system	Upfront cash	Best for
Equipment finance or chattel mortgage	You, from day one	Small deposit, or none	Owners who want all the savings and the asset
Secured business loan	You	None to small	Larger systems, or when property is available as security
Lease	The lessor, until the end	Low	Businesses that prefer predictable payments
Power purchase agreement (PPA)	The provider	None	Tenants or businesses that don’t want to own

Equipment finance and a chattel mortgage are the most common ownership routes. The system itself is the security, repayments are fixed, and the structure is well understood by installers and lenders. See equipment finance and chattel mortgages.

A secured loan can be better when you want to roll solar, a battery and an electrical upgrade into one raise, or when you have property equity that makes a larger amount available. See home equity business loans.

A lease means someone else owns the equipment for the term, and you may have an option to buy at the end. Total dollars paid are often higher than with ownership. See leasing vs buying equipment.

A power purchase agreement removes the capital outlay altogether. The provider installs and owns the system and sells you the electricity it produces. The trade-off is that you share the savings with the provider and often commit to a long contract. Read the term, the price escalation and what happens if you sell or leave the building.

Banks are often the cheapest source of finance, and some offer green or sustainability-linked products for energy upgrades. If you fit their criteria and your bank offers terms that suit, take that seriously. If a bank has said no, or the installer’s timeline won’t wait, an equipment finance specialist or non-bank lender is the usual alternative.

How do you know if solar is worth financing?

Forget the system price. The test is annual cash: the saving on your electricity bill against the annual repayments.

1. Get 12 months of bills, or interval data if you have a smart meter.
2. Ask the installer to estimate how much of the system’s output you would use on site, and how much would be exported.
3. Calculate the yearly saving, valuing exported power at the (lower) feed-in value.
4. Work out the annual repayment under each finance option, including fees.
5. Compare. If savings exceed repayments from year one, the system is cash-positive while you’re still paying for it. If repayments are higher, you are effectively paying a premium now for savings later.

A shorter term raises the repayment but cuts total interest dollars. A longer term lowers the repayment and lifts the total. Your equipment finance calculator will show both.

What reduces the upfront price?

Three things matter, and they change, so confirm each with the installer and the official sites.

• Small-scale Renewable Energy Scheme (SRES). Eligible small-scale systems, up to 100kW, can create certificates that the installer usually deducts from the price. The Clean Energy Regulator explains that the number of certificates falls each year until the scheme ends in 2030, so waiting a year tends to lower this discount.
• The Cheaper Home Batteries Program. It is open to small businesses as well as households. According to the Clean Energy Regulator, from 1 May 2026 the support tapers with battery size: the full factor applies up to 14kWh, 60% for the portion from 14 to 28kWh, and 15% for 28 to 50kWh. Batteries must be 5kWh to 100kWh, be installed with a new or existing solar system of no more than 100kW, and certificates are claimable only on the first 50kWh. The practical result: a mid-size battery gets a much better discount per kWh than a large one.
• Tax treatment. Solar is a depreciating asset. An instant write-off can apply to cheaper assets, subject to the turnover limit and current legislation, but many commercial systems cost more than the threshold. Check the ATO page and ask your accountant before the purchase, not after.

State and local programs also exist and come and go. Your installer should know what applies where you are.

What should you check before signing?

• The roof. Condition, age, orientation and shading all affect output. A roof that needs replacing in five years is a cost to include now.
• Landlord consent. If you lease, get written consent and make sure the lease term allows the payback. A PPA or short lease can fit a tenant better than buying.
• Network approval. Grid connection approval from your distributor can limit the export capacity or the system size.
• Who is installing. Ask for the installer’s accreditation and references, and what warranty covers panels, inverter and workmanship. An inverter is usually the component that fails first.
• What is in the quote. Metering, switchboard upgrades, monitoring and removal of old equipment can be added as extras.
• Performance assumptions. Ask what annual degradation and tariff rise the payback assumes.

A worked example

A small food manufacturer in regional Victoria has a $4,200 monthly electricity bill, most of it used between 7am and 5pm by refrigeration and packing lines. An installer quotes a 60kW system at $68k installed, after the SRES discount, with the owner using about 85% of the output on site.

• Estimated saving: about $2,700 a month, $32k a year.
• Financed through equipment finance over five years with a small balloon.
• Annual repayments, including fees, come to roughly $16k, about half the yearly bill saving.

The owner is cash-positive from the first month and owns the system outright at the end of the term. A PPA for the same roof would need no capital, but would hand a share of the saving to the provider for a decade or more. A lease would land somewhere in the middle. The numbers are illustrative only; what matters is that the comparison is in annual dollars.

For the owner who wants to add a battery, the tapered scheme matters. A 13.5kWh battery gets the full certificate factor, while stepping up to 30kWh brings the discount per kWh down. The extra capacity only makes sense if the evening saving justifies the extra price.

Mistakes to avoid

• Buying on payback alone without checking what the finance costs.
• Oversizing. Exported power is worth much less than power you use.
• Ignoring the lease. A ten-year payback on a five-year lease is a gift to the landlord.
• Skipping the tax check. Know the treatment before you sign.
• Rushing for a rebate. Deadlines create pressure; don’t let them override the numbers. The certificate decline is gradual.
• Leaving no headroom. Make sure the repayments still fit in a slow month.

For more on choosing between owning and leasing, see leasing vs buying business equipment, and for tax timing see the instant asset write-off and equipment finance. There is also a page on funding solar and energy upgrades.

Want to see what a particular system could cost to finance? Send us the quote.

Ready to see what finance would suit your system?

If the maths works on paper, the finance side usually takes less time than the quote did. Knowing which structure is open to you before you sign with an installer gives you a stronger hand.

Our form takes a minute or so, and asking carries no credit check, so your file stays as it was. Your details are not sprayed across a list of lenders. A real person reads what you’ve written and rings to talk it through. Put in the actual system cost, the roof situation and whether you own the building, so that the first option we raise is a good fit.

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