Solar Panel Payback Calculator
Estimate how long it takes for the electricity you no longer buy to cover the cost of a home solar system.
- Net system cost
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- First-year production
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- First-year savings
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- Net savings after 30 years
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How it works
First-year output is system size in kW, times peak sun hours, times 365, times system efficiency. Savings are that output multiplied by your electricity rate. Each following year, output falls by the degradation percent and the electricity price rises by the increase percent. Payback is the point where cumulative savings equal the net cost, estimated within the year it happens. We look out 30 years at most.
Frequently asked questions
Does this include the federal solar tax credit?
It starts at 0% incentive. As of our last review, the federal residential clean energy credit no longer applies to systems installed after 2025, but rules change, so confirm current federal, state and utility incentives and enter the total as a percent of system cost.
How many sun hours should I use?
Peak sun hours vary by location, roughly 3.5 in cloudy northern areas to 6 or more in the desert Southwest. The free NREL PVWatts tool gives a figure for your address. The default of 4.5 is a middle-of-the-road example.
What does system efficiency mean here?
It is the share of the panels' rated output you actually get after inverter losses, wiring, heat, dirt and shading. Values between 0.75 and 0.85 are common.
What is not included?
Financing interest, batteries, roof repairs, maintenance, net-metering rules, time-of-use pricing and changes in home value. Treat the result as a rough guide and get several installer quotes.
Related tools
How the numbers are produced: see our methodology.