Leasing Solar in Washington State

On January 15, 2014 the Department of Revenue (DOR) issued a rule making order pertaining to the Renewable energy system cost recovery program, also known as the “production incentive program”.

The rules clarified a few different matters, but by far the most interesting issue was surrounding solar leasing in Washington state.

Leasing solar panels has grown in popularity across the country, which has led to discussions about leasing solar in Washington to pop up in recent months. In a draft ruling first issued by the DOR on October 2, 2013, language had been added that would allow leased solar systems in Seattle and all other parts of the state to qualify for production incentive payments for the first time. The proposed rules were very controversial, and motivated numerous groups to attend a public hearing on November 12th and testify on the proposed changes. Solar installation companies from across Washington, including A&R Solar, made the trip to Olympia to explain how leased solar systems in Washington would effect their solar installation companies and the local solar installer industry in general. Several Washington utilities, manufacturers, and homeowners testified as well.

After much controversy and deliberation, the final rules issued by the DOR eliminated the proposed language that would have allowed solar panel leases in Washington to qualify for production incentive payments. Because of this, it will remain very difficult for solar leasing companies in Washington to make their leasing models pencil out. Because of the precedent set by the DOR’s final rules, any changes that would effect solar leasing will have to be made through the legislature. Thus, it could be some time before the option of putting a leased solar panel system on a home becomes a reality for homeowners and business owners across the state.