Calculate your potential savings and investment return on home solar energy.
Payback Period
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25-Year Savings
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ROI (Lifetime)
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Net Investment
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How Solar ROI is Calculated
Determining the Return on Investment (ROI) for solar panels involves understanding the balance between your upfront costs and your long-term utility savings. Most homeowners in the United States look at the Payback Period as the primary metric—this is the number of years it takes for your electricity savings to equal the net cost of the system.
Key Factors Influencing Your ROI:
Net Cost: The gross price of installation minus federal tax credits (like the ITC) and local state rebates.
Energy Offset: The percentage of your home's total energy consumption covered by the solar array.
Utility Rates: High local electricity rates lead to a much faster ROI.
Utility Inflation: Traditionally, electricity prices rise by 2-4% annually. Solar locks in your rate, protecting you from these hikes.
Realistic Solar Payback Example
Consider a standard 8kW system installation:
Gross System Cost: $24,000
30% Federal Tax Credit: -$7,200
Net Investment: $16,800
Annual Utility Savings: $2,100 ($175/month)
Payback Period: 8.0 Years
After the 8th year, the electricity produced by your system is essentially "free," leading to tens of thousands of dollars in pure profit over the remaining 25+ year lifespan of the panels.
function calculateSolarROI() {
var cost = parseFloat(document.getElementById('solar_system_cost').value);
var rebates = parseFloat(document.getElementById('solar_rebates').value);
var monthlyBill = parseFloat(document.getElementById('solar_monthly_bill').value);
var offset = parseFloat(document.getElementById('solar_offset').value) / 100;
if (isNaN(cost) || isNaN(rebates) || isNaN(monthlyBill) || isNaN(offset)) {
alert('Please enter valid numerical values.');
return;
}
var netCost = cost – rebates;
var annualSavingsInitial = monthlyBill * 12 * offset;
// Assume 3% utility inflation rate for a more accurate 25-year projection
var utilityInflation = 0.03;
var totalSavings25Years = 0;
var currentYearSavings = annualSavingsInitial;
for (var i = 1; i <= 25; i++) {
totalSavings25Years += currentYearSavings;
currentYearSavings *= (1 + utilityInflation);
}
var paybackYears = netCost / annualSavingsInitial;
var lifetimeProfit = totalSavings25Years – netCost;
var roiPercent = (lifetimeProfit / netCost) * 100;
// Display results
document.getElementById('solar_results').style.display = 'block';
document.getElementById('res_payback').innerText = paybackYears.toFixed(1) + ' Years';
document.getElementById('res_total_savings').innerText = '$' + totalSavings25Years.toLocaleString(undefined, {minimumFractionDigits: 0, maximumFractionDigits: 0});
document.getElementById('res_roi').innerText = roiPercent.toFixed(0) + '%';
document.getElementById('res_net_cost').innerText = '$' + netCost.toLocaleString();
// Scroll to results on mobile
if(window.innerWidth < 600) {
document.getElementById('solar_results').scrollIntoView({ behavior: 'smooth' });
}
}