Estimate your solar energy savings, payback period, and lifetime return.
Standard residential systems are usually 5kW to 10kW.
Include the 30% Federal Tax Credit (ITC) here.
Varies by location (e.g., CA is ~5.5, NY is ~4.0).
Estimated Payback Period
—
Years
Annual Savings:$0.00
Net System Cost:$0.00
25-Year Net Profit:$0.00
Total ROI:0%
Understanding Your Solar Investment Return (ROI)
Switching to solar is one of the most significant financial decisions a homeowner can make. Beyond the environmental benefits, the Return on Investment (ROI) often outperforms traditional market investments. This calculator helps you break down the financial viability of a photovoltaic (PV) system.
Key Factors in Solar Math
The Payback Period: This is the "break-even" point. It is calculated by taking your net cost (after tax credits) and dividing it by your annual electricity savings. Most US homeowners see a payback period between 6 and 10 years.
Solar Incentives: The Federal Investment Tax Credit (ITC) currently allows you to deduct 30% of your installation costs from your federal taxes. This significantly accelerates your ROI.
System Degradation: Solar panels are typically warrantied for 25 years. While they lose a small amount of efficiency each year (usually 0.5%), they continue to generate significant value long after the system has paid for itself.
Electricity Rate Hikes: As utility companies raise rates, your solar ROI actually improves because every kilowatt-hour you produce becomes more valuable.
Solar ROI Example
Imagine a 7kW system in Florida costing $20,000. After the 30% tax credit ($6,000), the net cost is $14,000. If that system produces $2,000 worth of electricity annually, the payback period is 7 years. Over 25 years, that system would save $50,000, resulting in a net profit of $36,000.
function calculateSolarROI() {
var size = parseFloat(document.getElementById('solar_systemSize').value);
var cost = parseFloat(document.getElementById('solar_totalCost').value);
var rate = parseFloat(document.getElementById('solar_elecRate').value);
var sun = parseFloat(document.getElementById('solar_sunHours').value);
var incentives = parseFloat(document.getElementById('solar_incentives').value) || 0;
if (isNaN(size) || isNaN(cost) || isNaN(rate) || isNaN(sun)) {
alert("Please enter valid numbers in all required fields.");
return;
}
// 1. Calculate Net Cost
var netCost = cost – incentives;
// 2. Calculate Annual Production (kWh)
// Formula: Size * Sun Hours * 365 * efficiency factor (standard 78% to account for inverter loss, wiring, etc)
var annualProduction = size * sun * 365 * 0.78;
// 3. Annual Savings ($)
var annualSavings = annualProduction * rate;
// 4. Payback Period
var payback = netCost / annualSavings;
// 5. 25-Year Lifetime Value (accounting for 0.5% degradation/year)
var totalLifetimeSavings = 0;
for (var i = 0; i < 25; i++) {
totalLifetimeSavings += annualSavings * Math.pow(0.995, i);
}
var lifetimeProfit = totalLifetimeSavings – netCost;
var roiPercentage = (lifetimeProfit / netCost) * 100;
// Display Results
document.getElementById('solar_payback_display').innerText = payback.toFixed(1);
document.getElementById('solar_annual_savings').innerText = "$" + annualSavings.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('solar_net_cost').innerText = "$" + netCost.toLocaleString();
document.getElementById('solar_lifetime_profit').innerText = "$" + lifetimeProfit.toLocaleString(undefined, {minimumFractionDigits: 0, maximumFractionDigits: 0});
document.getElementById('solar_roi_percent').innerText = roiPercentage.toFixed(0) + "%";
}
// Run once on load
window.onload = function() {
calculateSolarROI();
};