Solar Power Purchase Agreement (PPA) in Washington

What is a Solar Power Purchase Agreement (PPA) and is it valid in Washington?


Washington state is among the states that allow Solar Power Purchase Agreements. If you’re considering a PPA, it’s essential to review the terms and benefits specific to your location and needs.

A Solar Power Purchase Agreement (PPA) is a financial arrangement that allows homeowners to “rent” solar panels and pay only for the energy they generate without the high upfront costs. Washington state is among the states that allow PPAs, making them a viable option for businesses, universities, hospitals, and other entities committed to renewable energy and cost savings.

Here’s how it works:

Installation and Ownership:

  • A solar provider installs and maintains a solar power system on your property.
  • You, as the homeowner, do not own the panels; they belong to the company.

Electricity Generation and Billing:

  • The solar panels generate electricity, which you use in your home.
  • The company bills you for the electricity based on metered rates.
  • Typically, these rates are lower than what you’d pay to your utility company.

Savings and Considerations:

  • The exact savings depend on fluctuating power prices, but most PPAs are designed to save you money.
  • If the panels produce excess electricity, you may receive a credit against your utility bill.
  • Consider factors like contract length, early termination fees, and whether a PPA aligns with your needs.

Pros of Solar PPAs:

  • Affordability: PPAs allow homeowners to access solar power without any initial investment. There are no upfront costs or maintenance fees.
  • Lower Energy Bills: Under a PPA, you pay a fixed rate for the electricity generated by the solar system. These rates are often significantly lower than traditional utility rates.
  • Environmental Impact: By using solar energy, you contribute to a cleaner environment.

Cons of Solar PPAs:

  • Limited Savings: Since you don’t own the system, your savings are limited compared to owning the solar panels outright.
  • Escalators: Some PPAs include escalators, which periodically raise the electricity rate within the contract.


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  • Solar Washington
    published this page in Q&A 2024-03-28 16:21:18 -0700

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