We finance many large purchases in our lives, from cars to furniture, so we can enjoy them now without the upfront cost.
Buying solar and a battery is the same. With financing, you can spread the cost of your solar and battery investment over 5-10 years. But unlike other purchases, it will be saving you money on energy as soon as it’s installed! So your “out of pocket” expenses are lower than they appear.
Financing solar and you real out of pocket costs How does it work?
Here’s an example scenario using one of our mid-sized solar and battery systems:
System: 6.6kW solar system and 7kWh Redback battery installed in a NSW home
Cost : $13,750
You borrow: $14,000 (including loan fee)
Paid back over 7 years at a 7.99% interest rate from our recommended finance partner, Community First Credit Union (CFCU):
Yearly energy savings: $2174 a year*
Yearly repayments: $2652 a year**
Your out of pocket spend: Repayments – energy savings = $478 a year or about $40 a month!
Your out of pocket spend for a $14,000 loan over 7 years at 7.99% interest:
If you prefer to pay it off in 5 years at a 5.99% interest rate:
That equates to an out of pocket spend of around $90 a month, with your system paid off in five years.
What about 0% finance?
The solar industry has many companies offering 0% finance – but we’d caution you to be wary of such marketing. The way companies are able to offer this is actually by building the cost of the finance into their products. So you end up paying more and don’t end up with a clear picture of system and cost of the finance.
Want to find out more about financing with CFCU?
Community First Credit Union is our preferred loan provider for a number of reasons, including their flexible application process (online or over the phone) and ability to provide you with an instant application decision. Their Green Loan interest rates are also an attraction – for example, 5.99%* p.a. (Comparison Rate – 6.26%**) which translates to affordable repayments.
*This scenario is the 6.6 kW system and a mid sized battery (7kWh). Assuming typical generation in Victoria and assuming battery gets cycled 90% of the time at 90% depth, solar savings are estimated at $1,734 ($0.20 average value of the solar generated, which could be 10c FiT and 30c usage rate at 50/50% as an example). Battery savings would be an additional $440 per annum, for total savings of $2,174.
**Based on a $14,000 green loan through our preferred financing provider, CFCU, you could pay for this system in just 7 years at $221 per month (assuming interest rate = 6.99% p/a, comparison rate = 8.25% p/a). Then we’ve deducted energy savings of $181.16 per month ($2174/52). This gives actual out of pocket of $39.84. CFCU’s credit eligibility criteria, terms & conditions, fees & charges apply. Rate is current as at 01/08/19 and subject to change without notice. The comparison rate is based on an unsecured loan amount of $30,000 over a loan term of 5 years. WARNING: This comparison rate is true only for the example given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Community First Credit Union Ltd ABN 80 087 649 938 AFSL/Australian credit licence 231204.